Spanish building development continues despite no water license

Yesterday it was reported that a Spanish building promotor in Avila had begun demolishing forests and clearing land to carry out a massive building project without even having obtained a water license. This means that the construction company will be unable to guarentee water supply to possible property buyers.

Not only have an estimated 6700 trees been cut down in an ecologically sensitive area near Villanueva de Gómez (Ávila) in order to clear land for the construction work but the construction company in charge has no way of supplying the 7,500 homes it is planning to build with water because it has been denied a water license.

According to the article published in El País yesterday, despite the lack of license, the regional government of Castilla y León, run by the PP (Spain’s main opposition party), has given authorisation to the construction company to go ahead with building 3 golf courses (at a cost of a further 10,000 trees) ignoring technical reports that said the plans were absurd and without justification.

The local water authorities has revoked the water license on the grounds of the water table in this area being contaminated by arsenic. The present population of Villanueva de Gómez which number only 156 inhabitants is currently supplied with water by lorries and its inhabitants drink only bottled water. In June 2005, the construction company was awarded the rights to 771,363 cubic metres of water per year which was in addition to the 180,000 cubic metres that it already had which meant that the company had enough water to start work. However, it falls well short of the 2.5 million cubic metres of water required per year to supply the 22,000 inhabitants which could be living in ‘La Favera’ within a few years with water.

Furthermore, the area in question is important ecologically because it provides a habitat for a lot of wildlife including imperial eagles which are an endangered species in Spain. Because a building permit was granted to the previous owners of the land over 25 years ago ,the permission to build homes there was given without the need for an environmental survey although ecological groups such as SEO/Birdlife together with Comisiones Obreras insist that it is necessary. Large parts of the area have already been prepared for construction work with many zones already under tarmac and, according to environmental groups up to 10,000 trees have already been felled.

According to the article, the construction company intends to go ahead with its plans to build the homes and golf courses despite the lack of water and despite the looming housing market crisis in Spain.

Compensation for building defects in Spanish property

How to claim compensation for building defects in your Spanish property

If you have bought a property in Spain and you have found building defects, it is possible to claim compensation.

The law “Ley 38/1999 de 5 de Noviembre, de Ordenación de la Edificación” regulates these kind of matters. Alvaro Porcar Agustí of Porcar Abogados, a leading company of solicitors in Valencia offers the following advice to property buyers in Spain who have discovered defects in their new homes.

I.- What to do when building defects appear?

It is advisable that you take down the date when the defect appears, take photos, contact a notary and include the discovery in the property community book.

II.- Who should make the claim?

In theory, any owner can claim, but in practice it is usually the chairman of the proprietary community who makes the claim on behalf of the property owner(s).

III.- What is the time limit?

• One year since the building was completed for defects related to finishings


• Three years since completion for inhabitable defects


• Ten years since completion for major structural and foundation defects.
  

Note that any claims must be made within two years of the appearance of defects in the property.

IV.- How do I know who is responsible?

In the town planning department of your city hall you will be able to find out the promoter, construction company, architect and clerk of works of your property.

V.- How do I make my claim?

Always in writing, first of all to the promoter and builder company, to try and reach a friendly claim. Any lawyer can make the claim for you, and claims will need to be written in Spanish. If the friendly claim fails, it will be necessary to go to court and you are advised to get an estimate of costs from your lawyer before embarking on legal action.

VI.- Is my claim likely to be successful?

The rate of favourable solutions is actually very high, though obviously each case is different and the process can be quite lengthy. In most cases the courts rule against all the parties that took part in the construction of your property (promoter, builder company, architect and clerk of works).

Furthermore, all buildings initiated after May 2000, have a full insurance policy to cover structure and foundation damages. Architects are also covered by a compulsory professional insurance policy and in both cases the policies provide guarantee of the solvency, when court sentence arrives.

Recommended lawyer in Costa Tropical

Given the increasing number of visitors who contact us requesting names of reputable lawyers all over Spain, last year we signed an agreement with the Spanish branch of an international network of lawyers called Eurojuris. According to the terms of this agreement, all lawyer members of Eurojuris are committed to giving prompt, bilingual and highly professional services to the clients we forward on to them, and to charge them highly competitive rates (one of the problems our visitors often face is being overcharged by their legal representative during a property deal). They, importantly, have no contact with the property sellers or agents being used by our visitors, and your interests are the only ones they are interested in serving.

Eurojuris keeps us informed of the progress of all the clients we forward on to them and satisfaction level is 100% as so far all the property buyers forwarded on to them by us have been delighted with the service received. The network is one of Spain's most highly respected associations of solicitors. See below the experience of one satisfied customer:

Dear Madam

Sometime ago I approached Euroresidentes (email: euroresi@euroresidentes.com) seeking the name of a reliable
lawyer that I could use to handle the proposed purchase of a property in the
Almunecar area of Granada province. I was put in touch with Eurojuris Espana
and you kindly directed me to a firm in Almunecar.

I have recently successfully completed the purchase of the said property and
wish to put on record my sincerest thanks for directing me to such a top-class professional firm of lawyers. From the moment I first established contact with the partner in the firm - Irina Sviridovitch - I was extremely impressed with the efficiency with which my enquiries were answered. All emails and phone calls were returned on the same day or the following day. Clear, definitive answers were provided to all matters raised.

The purchase of the property necessitated 4 separate visits over 6 months to Almunecar. During my first visit Ms. Sviridovitch took me through the buying
process and explained in detail, yet in understandable layman's' terms, all
the legal aspects to the process. Fees were agreed at the initial meeting
and these were very reasonable.

For the subsequent three meetings Ms. Sviridovitch facilitated our requests for meetings at particular times and dates. As we were travelling with a three year old and an infant it was sometimes difficult to co-ordinate visits with estate agents to prospective properties but I can say, hand on heart, that we did not encounter any such difficulty in our dealings with our lawyer. Ms. Sviridovitch was extremely flexible in accommodating our requests for meeting.

Apart altogether from the excellent service I refer to above it was only when
we had decided to purchase a particular property that our lawyer proved what an invaluable asset she was to us. It is at this stage when one gets most nervous and in our case we had to contend with a lazy estate agent acting on behalf of the vendor, a vendor which comprised essentially four persons, a bank in a different province which held a mortgage on the property but yet refused to send a representative to the closing of the deal and some very sloppy paperwork prepared by the estate agent. During that last week I feared that the deal would fall through but thanks to the confident stewardship of Ms. Sviridovitch we closed the deal in early February, all the paperwork (notary matters, property registration, tax registration, payment of 'stamp duty', drawing up of wills etc.) has since been finalised and we are now the proud owners of a beautiful property on the Costa Tropical.

One final point I should add. Not being residents of Almunecar we had no idea
where we might buy electrical fittings, furniture and avail of the services of an electrician. Ms. Sviridovitch was extremely helpful in directing us to the appropriate persons and, in the case of the electrician, effectively saved us from nights without electricity and hot water when we last arrived in Almunecar - not a very pleasant prospect with two very young children.

I can highly recommend this firm of lawyers and Ms. Sviridovitch, in particular, and once aging thank you for directing me to this particular firm. I should add that a friend of mine recently acquired a property in Alicante and his experience with his lawyer was the complete opposite to mine. For this reason alone I am grateful for the efficient and professional service supplied to me by Fernandez Cuevas Abogados. I feel sure that, with the kind of quality service offered by this firm, it may confidently be relied on to provide excellent legal services to prospective clients

Kind regards

If anybody needs the service of a solicitor in the Costa Tropical - Granada area, just send us an email to euroresi@euroresidentes.com and we will forward it on to this highly recommended company of lawyers.

Related:
Spanish lawyers
Lawyers in Spain

Compensation for Spanish properties bought off-plan

I have paid a deposit on a flat at planning stage. When I paid the deposit I was given the plans for the flat in which the total living space measured 74m2 and cost 120,000 euros. However, when it came to signing the sales contract the promoter told me that the main staircase had to be moved which affects 6m2 of the total metres in the flat which means that the flat now measures less. The promoter has offered to discount 6000 euros from the total price but according to my calculations these metres are worth more than 6000 euros. Do I have the right to ask for a larger discount having already paid a deposit or do I have to accept the discount of 6000 euros offered by the promoter?

Answer:

You are right that the discount is less than the actual calculated value. According to my figures the discount should be approximately 9000 euros.
You can refuse to sign the sales contract but you need to evaluate whether the 3000 euros are worth taking out a claim against the promoter. You also have to evaluate the value of the flat given that a new flat would now cost more than the price originally agreed with the promoter.

Modification of property sales contract in Spain

Question:
It is possible to modify the sales contract with the Sales Promoter if you don’t agree with all the clauses or if you think that there are any important clauses missing? If so, how do you do it? I am in the process of buying a new flat and there are some important clauses missing from the sales contract I have been given to sign. I would be very grateful for some advice regarding this.

Answer:
You have every right to negotiate your sales contract with the promoter and ask about any clauses you believe to be missing. However, given the housing market at the moment where demand outstrips supply I think it would be practically impossible for you to negotiate on your own terms. Promoters often have the attitude of ‘take it or leave it’ given their position of strength. Nevertheless it is very important that before signing any contract that you are given a copy so that you can consult a lawyer and check the meaning of all the clauses. If there are any missing clauses it is important to know what the applicable legislation is.

Shared ownership property fraud in Spain

Co-sharing fraud operation discovered.

Spanish police in Malaga have arrested 8 people suspected of leading a real estate fraud network in the Costa del Sol and making profits of over 18 million euros at the expense of British and other European shared property buyers in Spain.

Police spokesmen yesterday said the criminal network was set up in 2000 and operated along the Costa del Sol. Over 300 companies and more than 1,000 individuals participated in the network which has affected more than 15,000 victims. The people arrested yesterday in Fuengirola, Mijas and Coín are suspected of being the leaders.

According to police investigations, the fraud was set up six years ago when a group of people living in the Canary Islands moved to the Costa del Sol and started to develop a network of companies selling participations in shared properties. The group was made up of nationals of the United Kingdom, South Africa, Belgium and Norway, and most of their victims were citizens in the UK and in central European countries.

The network used several different tactics to extract money from their victims. One was to get them to transfer money from their home country to pay the “expenses” related to the purchase of the multi property (legal costs, taxes...). Another was to sell a pretend holiday product to different buyers or to sell the same week at a given property to several people. Once the buyers realised they had fallen victim to some kind of fraud operation, they were referred to a bogus company of solicitors (set up by the criminal network) who got more money out of them by pretending to defend their claims and carry out false legal actions agains the original sellers. Another good reason why property buyers who don't live in Spain should avoid using lawyers recommended by the estate agency selling them the property.

The money extracted from thousands of victims has yet to be discovered by police who believe that most of it has been transferred to accounts in other countries. The investigation continues.

Related:
Lawyers in Spain

Dangers of the Spanish property market

The Guardian printed a full-page article yesterday about the Spanish property market with some startling figures that underline what we always advise to the thousands of users who write to us with questions about buying a house in Spain.

Anyone intending to purchase a property in this country is advised to first visit the site or house, then pay for the services of one of the many reputable lawyers in Spain (see lawyers fees in Spain) to check out all the legalities PRIOR TO SIGNING ANY DOCUMENTS REGARDING THE SALE and also, of course, before handing over any money.

According to the Spanish Agency for Holiday Homes quoted by the Guardian, Britons currently buy 50.000 houses in Spain each year and a group of Spanish companies specialising in homes for the elderly estimate that 226,000 British, 135,000 German and 35,000 Scandinavians are living here.

However, more and more stories of people buying properties in Spain do not have a happy ending. The Valencian LRAU law has made many properties vulnerable to possible seizure, as has the illegal construction of thousands of houses up and down the Spanish costas. According to the Guardian, a councillor of Alhama (a Murcian village with just 17,000 inhabitants where property developers plan to build 55,000 new homes and no less than 8 golf courses), has suggested that the area's biggest developer, Polaris World, has a London sales office where it is already selling unbuilt houses belonging to developments which have still not received full planning permission (although, in this case, they are expected to receive permission). And, the paper quotes the case of one British couple who have spent all their savings on a new home in Elche, but now risk having it demolished because the town hall says it was put up illegally by the builder they bought it from.

There are many reasons for living in Spain, but buying a house here is not as straightforward as it may seem and it is essential for buyers to get professional advice to prevent their dream home from going horribly wrong.

Valencia Land Law debated in the European Parliament

This week the European Parliament debated and voted on the recommendations of the Fourtou Report on the controversial Ley Reguladora de la Actividad Urbanistica (LRAU).

The law, known by those who protest against its consequences as the Valencia land grab law was originally designed to make sure that areas under development had sufficient infrastructure (roads, street lighting, green belt areas etc.). That was the the theory. However in practice the law has meant that property developers are able to apply to build on land already belonging to other owners where building is not permitted. When their application is approved (as it often is), the land is reclassified by the authorities, and the developers are then allowed to pay exisiting owners prices far below the real market value and build a road, a path or even part of a golf course, sometimes right through the middle of the former owner's back garden.

Most of the people affected by this law are Europeans who have seen their dreams of a perfect Spanish home in the sun shattered by ruthless developers. More than 15,000 people have made a formal protest asking the European Parliament to intervene, and the protest group set up to fight the LRAU, Abusos Urbanísticos No, has been active in attracting national, international, political and media attention to a growing problem and demanding a solution. And recently British law firm Irwin Mitchell decided to register land law victims with the European Human Rights Court .

Valencia's regional government promised in 2003 to revise and reform the LRAU, but seems in no rush to do so. A pre-project was presented to the Valencian parliament in June this year, but nothing has yet come of it. While the government insists that its intention is to change the law and protect the interests, and land, of property owners, opposition and protest groups allege that it is prevented from doing so from the interest of many of its members in the property development underway in the region.

Ever since local and foreign property owners started their active protest, the Government has come under increased pressure to do something. In the Summer a delegation of Euro-MPs visited the Costa Blanca and met with foreign residents, local politicians and property developers to discuss the problem. In November the European Parliament advised the Valencian authorities to modify urban development legislation in the region. And finally this week on 12th December the European Parliament discussed the Fourtou Report and endorsed its contents in a vote on the 13th by a massive majority of 550 in favour, 45 against and 25 abstentions. The Report calls on the European Parliament to urge a moratorium on the approval of new property developments on land where development is not permitted.

Any body considering buying property with land in the Valencian Region is advised to seek legal advice from a lawyer who can help with the necessary investigation to ensure that the land attached to the property is not in danger of being subject to eventual seizure by property developers.


Related:
EU homeowners and ambassadors challenge Valencian land laws
European Parliament delegation visit Valencia to challenge Land Laws
Valencian landlaws "unconstitutional"
Advice from the British Embassy to people purchasing land in Valencia

Lessons from one unhappy experience of buying a house in Spain

It is an unfortunate fact that the legal system in Spain is at times desperately slow. Anyone considering buying a house in Spain is advised to find a good Spanish lawyer before signing anything at all and before parting with any money.

David Wright has just started a new blog to share his unfortunate experience of buying property in Spain with other people. See the first entry below.

Users interested in following his story as the final part unravels (and as, we hope, justice is finally done and the Wrights win the home and compensation they deserve) should check out his blog: Slow legal system where he intends to keep people updated with events as and when they happen.

Considering tourism and housing investment bring considerable amounts of wealth to Spain, the Spanish law system is appalling slow and expensive.
At the begginning of 2000 we enetred into a contract to buy a house, paid the 10% deposit and arranged a date with the notary and respective lawyers to complete. The seeler did not turn up and decided not to sell. THE BIG SURPRISE... he also would not repay the 10 % deposit never mind the penalty of 10%. Our only alternative was litigation. As we were not living in Spain at the time we left a deposit with a lawyer who told us that it would be a straightforward case.
Well our case was finally heard in the local courts some 18 months later and we "won" including costs. However, the seller chose to appeal on what I understand to be very flimsy grounds. Some 2 years later the case was reheard in the Regional courts of Malaga where the original decision was upheald. ie we "won" again. However, the seller again decided with his lawyer that an appeal was in order and so we have been waiting almost 2 years for the case to come before a judge in MAdrid's high court!!! We still do not have a date nor can the system give us an estimated date as to when the case will be heard.!!!
WHAT CAN fellow EURORESIDENTES learn from this? I believe the following:
1: Entering litigation is very expensive - even though we have "won" twice, we have still had to pay our lawyers fees and costs even though the costs were awarded in our favour. The amount equates roughly to 17% of the purchase/contract price!!!! per hearing. At this point we have paid almost 50% of the orginal house contract price, (deposit plus fees)
2: The seller continues to live in the property and with no penalty or change.
3: We have no idea of timescale as to when the High court can hold the hearing.
4: The so called filtering process that was supposed to be implemented to stop people using the appeal process to delay matters as a tactic does not function.
5: The seller is not obliged to pay the costs awarded against them IF they choose to appeal....SO APPEALING is a good tactic to frustrate.
6: So having a contract from a good lawyer and within the letter of the law, still does not really protect your rights in a timely manner. WHAT then is the point of a contract? it is only worth something to the lawyers in preperation for litigation!!!
7: Perhaps the law will one day help us to retrieve our deposit and costs or even the holiday home we wanted to live in and enjoy in the future. However in the meantime, it has only benefited the lawyers and the vendor.
8: So the law can still be seen as having no "teeth" and benefits the unscrupulous property owner/seller. TAKE GREAT CARE.
Finally, if anyone has any suggestions as to what can be done to improve the law or indeed speed up the process then let me know

Buying rural property in Spain

Last week we received the following enquiry from someone buying property in Spain:

Question: We have paid a deposit on an ‘old’ property in Almeria. We later found out that the property has no Escritura and our estate agent and Spanish solicitor have both said this is not a problem – that the Escritura can be applied for and will be issued in our names and a Spanish mortgage granted. English banks will not provide a mortgage based on a newly issued Escritura as they say their policy is to wait two years to guarantee ownership and to ensure the property is not claimed back i.e. by a family member or a neighbour. My concern is not necessarily raising the money or getting a mortgage but the possibility of the property being taken away from us after we’ve paid for it, therefore loosing our money and the property.

Answer: Buying a rural house in Spain is a complicated process which can be full of problems if you do not look into all of them. The title deed (escritura) should be signed at the same time as when all the money is paid. The alternative is to pay first a reservation deposit and sign a private purchase/sale contract with the vendors or with the legal representatives (always get your lawyer to check the documentation presented by them to make sure they have legal rights to represent the real owners of the land and property).

Another very important piece of advice. The present owners of the plot of land where the house is must notify the owners of the land adjacent to the boundaries of your plot before selling to you because they actually have preference of purchase over you. By law the vendors should send formal letters to all of them offering them first refusal of the land and property you are going to buy. If within the legal period established, no (affirmative) reply is received, you are free to buy the land without any risk.

If you don't make sure the above is properly carried out, you could become another innocent victim of what can go terribly wrong when buying rural properties in Spain. Furthermore, if, as is often the case in Spain, you have agreed at the vendor's request to pay some of the purchase price in cash (so that the declared price in the deeds differs from the real rice you have paid), and if the owners of the adjacent land have not been notified and given the time established by Spanish law to answer, then they could take advantage of the lower "declared" price as stated on the title deeds, deposit the same amount with the Spanish courts and take over ownership of your property. You will be paid the money deposited with the courts, but you will have lost the cash payment as well as your new property.

Rights of tenants to buy rented property in Spain

We received this email from a Euro-resident in Spain last week:

"We have been living in rented accommodation ever since we moved to Madrid 8 years ago, simply because prices here meant we couldn't possibly afford to buy a flat. We found a lovely top-floor flat, within walking distance of our work, shops, parks, cinemas, belonging to a women who earns a living from renting out several flats she owns in Madrid. She lives in the same building, and we have always had a good relationship with her and, during the past 8 years, we have made the attic into our home, changed the floor, put heating in, decorated, changed the bathroom..... All at our own initiative because we understood that this was going to be our home for a long time. Our 2 girls were both born here. Four years ago we purchased a small house near Cadiz which we use for holidays and rent out to family and friends. We decided to do this rather than buy somewhere in Madrid because we love our flat so much. Last week to our horror, the flat owner told us she had put our atico up for sale and we had 3 months to find somewhere else to live. The original contract we signed states that either party has to give notice of 3 months, but we assumed this was just a formality and she has always said that we could live in the flat for as long as we wanted. Is there anything we can do to stop her from selling the flat, or have we acquired any rights during the 8 years we have lived here?"

The answer to the first question is no, you cannot stop her from selling her property, unless a clause in the contract you signed 8 years ago specifically gives you the right to do so (this is very improbable). If however, as seems likely, the contract makes no reference to any possible ownership rights of the tenants, and simply mentions a 3-month eviction notice, then the owner has complied with her side of the deal.

The answer to the second question is yes, you have acquired a very important right as tenants: the right to buy your home in the event of the owner putting it up for sale.

In Spanish this right is called "el derecho de tanteo y retracto". The first part "tanteo" refers to the fact that a tenant has the right to buy the property he/she is renting and should be given preference over any other potential buyers. The second "retracto" refers to the right of a tenant who discovers that his or her rented home has been sold to a third party, to re-purchase the property from the third party at the same price.

According to Spanish law, all property owners must give their long-term tenants 30 days notice if they decide to put their rented property on the market. In theory this gives tenants time to either find a new home or negotiate a purchase price with the owner and buy the property themselves. If the property owner fails to give the 30-days notice, then tenants can resort to their second right and purchase the property from the new owners (which is one reason why it is very important, if you are a buyer, to find out the exact conditions of any property you decide to purchase in Spain).

In your circumstances we suggest you try to negotiate a deal with the owner of your property based on your right, as long-term tenants, to have preference over other potential buyers. The fact that you have a good relationship with her should work in your favour. And you will have to decide whether you love your home enough to sell the house you have bought in Cadiz and use the money you make on it as a down payment.

Good luck!