Construction of houses up to 70m2 by notification – a chance for family construction companies ?

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The Union of Entrepreneurs and Employers (ZPP) has recently published its opinion on the draft law allowing the construction of houses up to 70m² by only notification, without the necessity of obtaining a construction permit. The solution, among others, may serve as a response to the current problems of the real estate market, including a limited supply of new flats, rising real estate prices, and also lengthy administrative processes that prevent efficient construction of houses. However, the organization calls to eliminate some ambiguous wording. 

ZPP indicates that the liberalization of construction regulations, intended to simplify the procedure related to the erection of simple residential buildings will be an opportunity for small domestic construction companies, especially those with a local reach or operating in smaller towns. At the same time, the organization noted that the proposed regulations that regulate the admissibility of development depending on the plot size are ambiguous and may cause interpretation doubts, highlighting, that, for example, the literal wording of Article 1 (1) (a) gives the impression that in order to build one house under the proposed procedure, the plot area must be at least 1,000m².

Also, the justification to the draft act does not provide a sufficient explanation, since, on the one hand it indicates that it provides for a requirement that the houses under construction up to 70m² should be detached buildings, while the specified permissible building density indicates that there may be one such building on a plot of at least 1,000m². ZPP notes, that the further wording of the justification is inconsistent with the above, as it indicates that it will be possible to build one such house even on a plot of 500m², while the construction of two such houses requires a plot of 2,000m².

At the same time, despite some interpretations issues, ZPP recognizes that the initiative will result in an even stronger growth of the construction industry in the country, as well as create conditions for aligning the revenue potential of small and medium-sized enterprises with the potential and opportunities of the largest entities, mainly focused on large-scale development investments.