Buying an Apartment from a Developer: Escrow Account, DFG, Handover and Defects (2026)

When buying an apartment from a developer, you usually pay for something that does not yet exist. Since July 1, 2022, the 2021 Developer Act protects you: payments go to an escrow account, the Developer Guarantee Fund oversees them, and the handover of the apartment has a statutory procedure with deadlines. As of July 11, 2025, developers must also publish prices, so "price on request" is becoming obsolete. Below, we go through the entire process: checking the developer, the reservation agreement and developer agreement, handover with a protocol, defects, and withdrawal from the contract. There is also a section on purchasing from abroad.

Informational material, not legal advice. Developer contract templates may vary, and case law changes, so show the contract to a lawyer for a specific transaction.

In Brief

Before Signing Anything, Check the Developer

1. KRS and Finances

   On the National Court Register (KRS) Portal, you can check for free how long the company has existed, who manages it, and what financial statements it submits. A special purpose company established for a single investment is now standard. The history of the entire group and its previous developments is even more important.

2. Land Register of the Plot

   On ekw.ms.gov.pl, you can see if the developer is the owner or perpetual usufructuary of the land and what mortgages are encumbering it. A bank mortgage financing the construction is normal. What matters is whether the bank has given consent for the non-encumbered separation and transfer of your unit (or committed to do so). The developer must have this consent before starting sales, and a copy is an attachment to the contract (Article 25 of the Act).

3. Information Prospectus, Read Thoroughly

   The developer must deliver it to you for free, on a durable medium, before the reservation or developer agreement (Article 21). It contains the legal status of the land, building permit, schedule, finishing standards, local plan arrangements for plots up to 100 m from the investment area, and information about planned investments within 1 km (roads, rail lines, environmental decisions). This is where you will learn about the bypass outside your window. At your request, the developer must also show in their office, among other things, the financial statement for the last two years (for a special purpose company, also the parent company) and the construction project (Article 26).

4. Compare Prices, as They Are Transparent

   From July 11, 2025 (amendment to Journal of Laws 2025 item 758, Articles 19a and 19b of the Act), the developer publishes on their website the price per m² and the total price of each offered unit, with dates of changes. Once a day, this data is sent to the Minister of Digital Affairs and published on dane.gov.pl. If the price listed on the website differs from what the salesperson offers you, you can demand a contract at the most favorable price for you (Article 19a paragraph 6). In contracts concluded from February 13, 2026, the price is stated as the product of the area and the price per m² (Article 5a). Public statistics on transaction prices in the DOM Portal, managed by the Insurance Guarantee Fund, are set to fully launch on April 2, 2027.

5. Previous Investments and Reviews

   Visit the developments that the developer has already completed and talk to residents about defects and deadlines. Also, check if the provisions from contracts of this company have ended up in the UOKiK register of prohibited clauses.

Reservation Agreement, the First Binding Document

• It must be in writing under penalty of nullity and for a specified period. If you are applying for a loan, the reservation period should account for the time needed by the bank to make a decision (Articles 30 and 31 of the Act).
• The reservation fee is at most 1% of the price from the prospectus. After signing the developer agreement, it is credited towards the price, and the developer transfers it to the escrow account within 7 days (Article 32).
• Refund of the fee (Article 34) is due to you if you do not receive a loan due to a negative credit assessment, if the developer does not fulfill the reservation agreement, or if they changed the prospectus and did not inform you. If the developer does not fulfill the reservation agreement, they return the fee in double the amount. The double refund also applies to the purchase of a finished unit preceded by a reservation when the seller did not remove defects from the handover protocol, and therefore you did not sign the deed.
• As of July 16, 2023, the transfer of rights from the reservation agreement to a third party is invalid. The exception is the transfer to a person from the I or II tax group, i.e., close and extended family (Article 30 paragraph 3 and 4). Trading in "reservations" is therefore closed.

Developer Agreement: What It Must Include and How It Protects You

• Form: notarial deed. The notary's fee for activities related to this agreement and court costs in the land and mortgage proceedings are shared equally with the developer (Article 40 paragraph 2).
• Entry of the claim into the land and mortgage register of the plot ensures that your right to transfer ownership is visible to everyone. This protects you in case of the sale of the land or enforcement.
• Content: includes, among other things, the price, area and layout of the unit, finishing standards, the date of ownership transfer, payment schedule, conditions for withdrawal, and contractual penalties. Provisions less favorable to you than the law are invalid and are replaced by the provisions of the Act (Article 42).
• Interest vs. penalties: interest reserved for the developer cannot exceed the contractual penalties reserved for you. If the contract does not provide for either penalties or interest, in case of non-performance by the developer, you are entitled to compensation equal to statutory interest (Article 39).
• Schedule linked to construction: the investment must have at least 4 stages, and the cost of any of them cannot exceed 25% or be lower than 10% of the total (Article 24 paragraph 2). The bank pays the developer money from the open account no earlier than 30 days after the agreement and only after confirming that the stage has been completed (Article 16).

Where Your Money Is: Escrow Account and DFG

As a result, the bankruptcy of the developer or the bank does not mean the loss of payments. Money is returned from the account and from the DFG, and the Bankruptcy Law provides for a separate procedure in which the trustee can continue construction with the consent of the supervising judge.

Apartment Handover Step by Step

1. Come Prepared, Preferably with a Professional

   The handover takes place in your presence, after the occupancy permit has been validated (Articles 41 paragraph 1 and 2). You can bring an engineer or an inspection specialist. A level or batten, measuring tape, socket tester, and flashlight will be useful. Check the area, verticals, plaster, windows, ventilation, and connections.

2. Record Every Defect in the Protocol

   The handover protocol is provided for by law (Article 41 paragraph 3). Reported defects are recorded, and in the case of a significant defect, it is also noted whether the developer acknowledged it or refused. Unrecorded defects are harder to enforce later in this procedure, although you still have the warranty.

3. Developer: 14 Days to Respond, 30 Days to Repair

   Within 14 days of signing the protocol, the developer must provide you with a written response acknowledging the defects or a refusal with justification. If they remain silent during this time, it is considered that they have acknowledged the defects (Articles 41 paragraph 4 and 5). Acknowledged defects must be rectified within 30 days of signing the protocol. If they cannot meet this deadline despite their efforts, they must indicate another deadline and justify the delay. If that deadline passes or the developer does not specify one, you set your own. After its ineffective expiration, you can rectify the defects at the developer's expense (Articles 41 paragraphs 6 to 8).

4. Significant Defect? You Can Refuse the Handover

   If the unit has a significant defect and the developer refuses to acknowledge it in the protocol, you can refuse the handover. You then set a new deadline in which the developer can rectify the defect before the re-handover. If you refuse again during the re-handover, you need an opinion from a construction expert, which you must request within a month of the refusal. If the expert confirms the significant defect, you can withdraw from the contract, and the cost of the opinion is borne by the developer. If the expert does not confirm it, you bear the cost. If the developer acknowledged the significant defect but did not rectify it within the deadlines described above, you can also withdraw (Articles 41 paragraphs 9 to 17).

5. Defects Revealed Later

   Defects noticed between the handover and the deed of transfer must be reported to the developer promptly. The 14 and 30-day deadlines then count from the report (Article 41 paragraph 19). After the transfer of ownership, liability for defects is based on the warranty from the Civil Code: it covers defects identified within 5 years from the handover of the premises (Article 568 § 1 of the Civil Code). As of September 9, 2025, the Developer Act directly refers to these provisions (Article 41a).

Defect at Handover: What Next

This scheme will help you determine at which stage of the procedure you are and what your next move is.

When You Can Withdraw from the Contract

• Defective contract or prospectus: lack of mandatory elements, non-delivery of the prospectus, discrepancy between the contract and the prospectus, or the prospectus not matching the actual state. You then have 30 days from the conclusion of the contract (Article 43 paragraph 1 points 1 to 5 and paragraph 2).
• Developer does not transfer ownership on time: you set an additional 120 days. If that time passes without effect, you can withdraw and still demand a contractual penalty for the delay (paragraph 3).
• Lack of the developer's bank consent for the non-encumbered separation of the unit: 60 days from the conclusion of the contract (paragraph 1 point 8 and paragraph 5).
• Significant defect: acknowledged and not rectified or confirmed by an expert (paragraph 1 points 10 and 11). You can also withdraw if the trustee in the developer's bankruptcy demands the execution of the contract (point 12).
• Form: statement in writing with a notarized signature, with consent to remove your claim from the land and mortgage register (Article 45). The contract is then considered not concluded, and you do not bear the costs of withdrawal (Article 44 paragraph 2). The bank returns funds from the escrow account, the developer returns what they have already received within 30 days of receiving the statement, and if they do not do so, the DFG comes into play.
• The developer can withdraw only if you do not pay on time despite a written notice with a 30-day deadline or if you do not appear for the handover or notarial deed despite two written notices spaced at least 60 days apart. This does not apply to situations caused by force majeure (Article 43 paragraphs 7 and 8).

Assignment of the Developer Agreement and Its Limitations

As of July 16, 2023, trading in "apartment agreements" is restricted (Article 37a of the Developer Act):

• Transfer of rights to a person outside the family is permissible if the total agreement concerns at most one unit and the transferor has not transferred rights from another such agreement in the last 3 years.
• Without these restrictions, you can transfer rights to a person from the I or II tax group.
• The transfer agreement requires a notarial deed, and the transferor declares under criminal liability that they meet the 3-year condition. However, violation of the conditions does not invalidate the assignment itself.
• Rights from the reservation agreement cannot be transferred at all (such an assignment is invalid), unless to a person from the I or II tax group.

Taxes and Costs

• VAT instead of PCC: the price from the developer includes VAT. The rate of 8% applies to apartments up to 150 m² and single-family houses up to 300 m². For larger areas, 8% applies proportionally to part of the price, and the excess is subject to the basic rate of 23% (Article 41 paragraphs 12a to 12c of the VAT Act). You do not pay PCC 2% in this case.
• Exception for bulk buyers: if you buy the sixth and each subsequent unit in the same investment, you pay PCC 6% alongside VAT for such an agreement (Article 7a of the PCC Act).
• Notary and court: you share the costs of the developer agreement equally. The costs of the ownership transfer agreement are divided according to the agreement, usually paid by the buyer. The court fee for entering ownership in the land and mortgage register is 200 PLN, and for entering a mortgage with a loan, also 200 PLN. The notary usually charges PCC 19 PLN for a mortgage securing a loan (rate for claims of an unspecified amount).
• More about taxes when purchasing can be found in the PCC guide, and about financing in the mortgage guide for the Polish diaspora.

Purchasing from Abroad

• Power of Attorney: you can sign the reservation agreement remotely, as it requires a written form. The developer agreement and transfer of ownership are notarial acts, so a power of attorney with a notarial deed (usually prepared abroad with an apostille and translation) acts on your behalf. Details in the power of attorney guide from abroad.
• Payments from abroad to the escrow account are possible. Prepare documents showing the source of the funds, as the bank may ask for them, and monitor the exchange rate for large transfers.
• Handover: the law requires the buyer's presence, but a power of attorney can act on your behalf, preferably together with a handover specialist. Ensure that the power of attorney explicitly covers the handover, signing the protocol, and reporting defects.
• Tax on future sales: five years after which the sale is exempt from PIT counts from the end of the year in which the deed of transfer was signed, not the developer agreement.

Common Mistakes in the Developer Agreement

• Paying a "reservation fee" higher than 1% or without a written reservation agreement.
• Not checking whether the developer has the bank's consent for the non-encumbered separation of the unit.
• Reading the price list instead of the prospectus. You will learn about the planned road or facility next door from the prospectus, not from the advertising brochure.
• Hastily completing the handover without a professional and the protocol without recorded defects.
• Signing the handover despite a significant defect that the developer did not acknowledge. You then lose your strongest argument, which is the refusal of the handover.
• Inaction regarding deadlines. The 14 and 30-day deadlines and your deadlines for withdrawal arise from the law, so count them and keep all correspondence.
• Reselling the agreement with an "assignment fee" without checking the assignment restrictions and tax implications.
• Confusing the reservation agreement with the developer agreement. Only the latter (notarial deed and entry of the claim) truly binds the developer.

Frequently Asked Questions

Will my money be lost if the developer goes bankrupt?

Generally, no. Payments are in the escrow account, and the difference that the bank does not refund is covered by the Developer Guarantee Fund in the cases mentioned in the Act. Bankruptcy law also provides a path where the trustee, with the consent of the supervising judge, can complete the construction.

I did not receive a loan. Will I get my reservation fee back?

Yes, if the bank denied it due to a negative credit assessment. The developer must refund the fee immediately. Ensure that the reservation agreement is in writing and that the reservation period gives the bank time to decide.

The developer raises the price, citing indexation. Can they do that?

Only if the contract clearly provides for it, and provisions less favorable to the buyer than the law are invalid. Unclear indexation clauses may be deemed prohibited. In case of a price increase, ask for the basis in the contract and show it to a lawyer or consumer advocate.

What is a significant defect?

The Act does not provide a definition. In practice, it refers to a defect that prevents or seriously hinders normal use of the unit, such as leaks, lack of functioning ventilation, or significantly smaller area. In case of a dispute, the opinion of a construction expert resolves it in the re-handover procedure.

I am buying from the USA. Can I handle everything without flying in?

Yes. You will sign the reservation remotely, the developer agreement, handover, and final deed will be handled by a power of attorney, and payments can be made via transfer. One trip for the handover is helpful but not necessary.

Am I also protected when buying a finished apartment from a developer?

To a large extent, yes. Besides the developer agreement for a unit under construction, the Act also covers agreements in which the developer commits to transfer ownership of an already built unit, such as a notarial preliminary agreement (Article 2 paragraph 1 points 2 and 3). In that case, the prospectus, escrow account, DFG, and statutory handover apply. When you sign the sale agreement immediately, the Act operates more narrowly: it provides access to documents upon request, rules for the reservation agreement, and handover with a protocol (Article 3). When purchasing from a private individual, none of these mechanisms apply, and everything depends on the content of the agreement.

Sources

Status as of October 23, 2026. This guide is informational and does not constitute legal or tax advice. Before signing a contract with a developer, consult it with a lawyer or notary.