Mistakes when buying off-plan property: which are the most expensive, and how can you protect yourself before signing?

A show apartment and a time-limited offer can create pressure to sign. But the initial installments alone do not reveal the final cost, effective delivery date or consequences of withdrawing. Buying off-plan means buying a unit still to be built or completed, so the registered project, affordability and each party’s obligations need careful review.

In this article, we cover the most common (and costly) mistakes in this kind of purchase, what to check about the developer before signing, which clauses deserve extra attention, what the law guarantees if the project runs late, and which extra costs wreck the budget of buyers who failed to plan.

What does the law say when the contract “says nothing”?

Off-plan purchases are governed by Law 4,591/1964, the Consumer Protection Code where a consumer relationship exists, and amendments under Law 13,786/2018. The date and contractual regime matter: later rules do not automatically apply to earlier transactions. Mandatory law limits unfair terms; a clear agreement sets out price, indexes, deadlines and responsibilities.

If delivery is already late, use our construction-delay compensation calculator for an initial estimate, subject to legal review.

How do you vet the developer before signing?

The vetting starts with the property record (matrícula), not with the marketing material. An off-plan development can only be sold after the development memorandum is registered with the Real Estate Registry (art. 32 of Law 4.591/1964) — selling without that registration is irregular and exposes the buyer to serious risk. Ask for an up-to-date copy of the property record and confirm:

1. the registration of the development (the “R.” entry for the development on the parent property record);
2. whether there are segregated project assets (patrimônio de afetação), separating the project’s assets, rights and obligations from the developer’s other assets; this is significant protection, not a guarantee of completion or reimbursement;
3. the developer’s certificates: tax debts, lawsuits over construction delays and building defects (public search on the TJSP, the São Paulo state court website), and complaints filed with Procon-SP.

A verifiable delivery record and asset segregation inform the assessment but do not replace project-specific checks. A new special-purpose company (SPE) may lack its own track record without being irregular: check its controllers, security and financing.

Which contract clauses deserve extra attention?

Four clauses account for most of the disputes:

1. Grace period. Article 43-A permits up to 180 calendar days where expressly agreed in clear, prominent wording and within the provision’s scope. It is not automatically added to every agreement.
2. INCC adjustment. The agreement may link the outstanding balance to FGV’s construction cost index. Model scenarios without treating a past increase as a fixed rate, and check the rules after delivery and during delay. The installment due on delivery may differ from the initial price list.
3. Termination. In Article 67-A cases, the contractual penalty may reach 25% of amounts paid, or 50% with segregated project assets, subject to statutory conditions. Brokerage and other permitted deductions may apply: the penalty ceiling is not necessarily the total retention. Check the cause, contract date and any withdrawal right.
4. Summary table. Article 35-A requires information on price, indexes, payments, delivery and termination. Its paragraph 1 provides 30 days to amend missing information; an uncured omission gives the buyer grounds for termination, not automatic invalidity of the whole contract.

These terms allocate transaction risks. Signing does not validate an unfair term, but advance review helps avoid obligations accepted without understanding them.

What can you do if the project runs more than 180 days late?

For agreements covered by Article 43-A, once delivery and a validly agreed grace period expire, two options may arise depending on the cause of delay and the buyer’s compliance:

• Terminate: if the buyer did not cause the delay, a full refund and applicable penalty, adjusted for inflation, within 60 calendar days from termination;
• Continue: a buyer current on their obligations may receive 1% per month of the amount actually paid to the developer, prorated daily, inflation-adjusted and payable on delivery.

Under STJ Topic 970, a delay penalty equivalent to rental value generally cannot be combined with lost profits for the same delay. Topic 971 uses a buyer-only penalty as a reference for assessing compensation for the seller’s breach in cases covered by the thesis; it is not an automatic mathematical reversal. The penalties under Article 43-A paragraphs 1 and 2 cannot be combined either.

Which extra costs wreck the buyer’s budget?

A reserve of 5%–7% may be a planning scenario, not a universal budget or ceiling. Calculate separately:

• ITBI: São Paulo’s general rate is 3%, with specific rules for certain financed transactions. The tax base requires analysis of CTN Article 38 as amended by Complementary Law 227/2026, published municipal technical criteria and the right to challenge through a counter-valuation. STJ Topic 1,113 must be considered under the relevant temporal regime; the higher municipal reference value should not simply be treated as conclusive;

• Deed and registration: a public deed, when required, is drawn up by a notary; the transfer is registered at the Real Estate Registry. These involve distinct fees under the applicable tables;

• Condominium charges and IPTU: check availability, possession, the agreement and tax rules. Some expenses can be due before you move in;

• Finishes: the specifications determine what is delivered and what you must purchase separately.

For a R$ 500,000 purchase, an illustrative R$ 20,000 reserve is 4% of the price, not a certified estimate of tax and registry fees or necessarily an allowance for finishes. Itemize actual costs and what financing covers.

A concrete example: Pedro, Ana and the Torre Horizonte

Hypothetical example: Pedro and Ana assess a R$ 500,000 unit, check registration and asset segregation, and model a R$ 40,000 balance increase without treating it as a forecast. If the compensable delay after a valid grace period is exactly two months, and R$ 250,000 was paid to the developer, 1% monthly gives R$ 5,000 before inflation adjustment and any relevant corrections. This assumes Article 43-A’s requirements; it is not a client case or payment promise. Eight calendar months are not automatically 180 days plus two months.

The most common (and costly) mistakes

1. Signing at the sales stand, under “last unit” pressure. Risk: accepting the index, the penalty and the grace period without negotiating — and the contract binds you for years.
2. Not checking the development’s registration on the property record. Risk: buying a unit in an irregular development, with the works subject to a stop-work order.
3. Budgeting based on the “price list” installment. Risk: the INCC inflates the outstanding balance and the approved bank financing does not cover the difference when the keys arrive.
4. Ignoring the segregated project assets regime. Risk: if the developer goes under, competing with all the other creditors for whatever is left.
5. Walking away without doing the math. Risk: retention of up to 25% (or 50%) of what was paid, when assigning the contract to a third party could cost far less.

Actionable checklist before signing

• Up-to-date property record with the development registration (art. 32, Law 4.591/64);

• Check for segregated project assets on the property record;

• Certificates for the developer and the SPE + lawsuits at the TJSP + Procon-SP;

• Complete summary table: price, INCC, delivery date, grace period, penalties for both sides;

• Simulation of the outstanding balance with the INCC projected through the keys;

• Reserve for ITBI (3% in São Paulo), registration, condominium charges and finishings;

• Contract review by a lawyer before signing — not after the problem.

Frequently asked questions

Can the developer deliver 180 days late without paying anything?

Article 43-A allows up to 180 calendar days where the grace period is expressly agreed in clear, prominent terms and the provision applies. It is not automatic. After the actual agreed deadline and valid grace period, assess the cause of delay and the buyer’s compliance.

I backed out of an off-plan purchase: how much will I lose?

In Article 67-A cases, the penalty can reach 25% of amounts paid, or 50% with segregated project assets, subject to statutory requirements. Brokerage and other lawful deductions may be additional. The contract date, cause of termination, withdrawal rights and conditions for a replacement buyer must be assessed before calculating the loss.

What is the INCC and why does my installment grow before the keys?

The INCC, calculated by FGV, measures construction costs. Where validly agreed, it adjusts the outstanding balance under the contract, affecting installments and the payment due on delivery. Model scenarios and check post-delivery and delay provisions without treating past increases as guaranteed future rates.

Do I need a lawyer to review an off-plan purchase contract in São Paulo?

A lawyer is not mandatory merely because you are buying. Review helps assess registration, payments, grace periods, penalties and asset segregation, but cannot guarantee completion or remove every risk and dispute cost.

Can I claim compensation if the project runs late?

Compensation may arise after the applicable delivery deadline. Under Article 43-A, continuing the purchase may entitle a compliant buyer to 1% monthly of amounts actually paid to the developer, prorated daily and adjusted for inflation. Termination is an alternative subject to its legal conditions. Penalties and lost profits should not be added automatically.

Protection happens before you sign — afterwards, it can only patch things up

Many risks can be identified before signing, while resolving them later may cost more. Investigating the developer, checking registration and the summary table, and modeling payments supports an informed decision within your budget.

At Falchet e Marques Sociedade de Advogados, a law firm in São Paulo (Av. Paulista), we provide prior reviews of off-plan purchase contracts and due diligence on developers, and we act in cases involving construction delays, purchase termination and billing reviews — so that your investment reaches the keys protected.

Talk to our team on WhatsApp: +55 11 95901-1854 — send us the contract or the offer before you sign and get the points of attention for your case.