Real Estate Due Diligence: What to Review Before Signing

May 26, 2026 · 7 min read

Most problems that arise after a property purchase are not unforeseen events: they are elements that were present before the transaction and were not reviewed with sufficient rigour. Due diligence — the process of verification and analysis prior to acquisition — is precisely the tool for avoiding those surprises.

Legal due diligence

This is the starting point. Before committing to any figure, it is essential to review the current land registry entry (ownership, charges, mortgages, foreclosures, easements), the cadastral situation to confirm it matches the physical reality, applicable licences and permits, the tenancy agreements in force — their term, rent, agreed review mechanisms, security deposits, break clauses — and, if the building is part of a community of owners, the state of its accounts and any outstanding levies.

A contract that appears solid on its face can conceal a break clause that vacates the asset within twelve months. Only careful reading reveals it.

Technical due diligence

A physical inspection of the building, carried out by an independent professional, is indispensable. Critical areas include the condition of the structure and roof; the building’s systems (electrical, plumbing, HVAC, lifts) along with their service certificates and age; the ITE (Technical Building Inspection) — an overdue or deficient ITE represents a future cost that must be quantified before making an offer; the energy performance certificate, which increasingly affects the commercialisation of space; and the detection of hidden defects such as damp or obsolete installations.

Financial due diligence

This is where the genuine quality of the cash flow is examined. Not the contracts, but the rents actually collected, verified against bank statements. The true historical OPEX — council tax, service charges, insurance, maintenance — not an optimistic estimate. The quality and creditworthiness of each tenant: their tenure in the building, sector, payment history. The historical vacancy of the asset and its catchment area. And a rent projection that accounts for upcoming lease expiries and pending rent reviews.

Planning due diligence

Less common but critical for certain assets. It is worth verifying the land and building use classification, the applicable regulations on permitted uses and heights, any planning proposals in progress that could affect the asset, and whether any special protection or use restriction applies that is not immediately obvious.

How we integrate this at INVARA

At INVARA, we do not present an asset without having completed at least a preliminary due diligence of our own. When an investor enters a deal, the essential verified elements are already on the table: clean title, reviewed tenancy agreements, known technical condition. Investors can and should appoint their own advisers — we recommend it — but they start from a pre-filtered basis that reduces decision time and eliminates post-closing surprises.