Learning how to buy a new property in Spain can be a harrowing experience, especially if you are a foreigner. Over the years, the system among many organisations dealing in property has evolved into a rather slick procedure with essential information withheld or worse still deliberately ignored so as not to cause any alarm to  potential buyers. In some cases, a considerable amount of information which has little relevance to the subject is supplied to create the impression of full disclosure.

For those contemplating the purchase of a new property there is a lot to consider. Lack of familiarity with the laws and the culture of the country can be a difficult obstacle to overcome. So just how safe is it to purchase property in Spain?  - it's so important  that we constantly stress that the purchase of property in Spain is perfectly safe providing that it's carried out in accordance with the explicit property laws and purchasing practices and people don't attempt to go around or avoid them.

Despite the bad publicity sometimes received by Spain's housing market, in the majority of cases involving fraud, the buyers had quite simply either ignored the laws of the land - by purchasing property upon which there were unpaid taxes (which become the responsibility of the buyer) or in an attempt  to save money the buyer had knowingly broken the law by purchasing property which was  built illegally or, in many cases, problems had been brought about by ignorance, either on behalf of the buyer or those supposedly representing  him.

Mistakes have happened (and still do) with some of the property companies who have exchanged the idea of service for more lucrative "conveyor belt marketing" - encouraging visits to Spain by offering subsidised travel and accommodation or in some cases, even giving it away in an attempt to attract customers for their sales force.

The client having requested a free visit or booked  a subsidised inspection visit is collected at the airport and taken to a hotel. Everything will be included in the price including entertainment during the evening. The schedule visit contains not a single free minute. Every meal is provided. You don't have a minute alone, Worse, after a day of viewing property, instead of being left to your own devices so you can discuss in confidence what you feel and what you have seen you will be fed, given alcohol and finally put to bed. 

The following day the procedure will be repeated. This technique  does not represent your interests in any way at all. You should be looking at the area and forming your own conclusions. You are being manipulated rather than assisted. Would you normally buy like this? Of course not!

So how do you  buying new property safely. It's not difficult - at all times ensure that you remain in control of what you are doing. Ensure that you know what is happening and why. Make sure that you know what is planned and if you don't like it don't buy it. You may find that some sales people will become quite annoyed with sales resistance and if this is the case then you know you are in the wrong hands. Nothing can be done about this other than to return at a later time and start your search again but under more ideal conditions.

Regarding the question of commissioned sales people, if these are necessary to produce sales and you are dealing with a commission type organisation, then it is obvious that a considerable amount of eagerness is going to accompany the product knowledge which is being delivered! Commissions would be better paid based on client handling and their satisfaction but in any organisation which is sales led this would be somewhat daunting.
         
Now that you have found a property and we assume you wish to buy it. What happens next?.  Although the following proceedure  is almost universal amongst agents and companies, there may be slight variations used by different organisations. Whatever the method used, you must know and understand it. If it's not explained to your satisfaction or you are not sure - stop!

Having decided that you wish to buy, you will be told that a deposit will be necessary. This can be anywhere between £1000 to 10 per cent of the purchase price. You will then be told that a balance, sometimes taking the amount to 50 per cent of the purchase price is required before building will commence. This means that you have to pay half the money for your property up front! With some builders it is possible to negotiate different terms but in the main, until such time as they have a considerable amount of your money, they won't start to build.

Spanish builder over the years have tired of clients, who having signed a legally binding contract returned to their own county and prompty defaulted on it. They became aware that where this was happening a considerable amount of sales pressure had been applied to the clients who had been advised to pay a reservation deposit and then signed a  contract which can be legally binding,  changed their minds and did not wish to proceed or in some cases did not have the funds to continue with the purchase. To guard against this, they asked for large payments in advance and 50 per cent with purchase contract became the norm.

Some builders/developers will accept the balance on completion when the keys are handed over at the Notary but others require a further payment of 25 per cent about three quarters of the way through the project. Whatever the terms of the payment, these should appear clearly in the contract and on this subject, if you do not speak Spanish then you want a copy translated into your own language and a statement to the effect that it is accurate.

With virtually all new property being purchased off plan, the contract is vital. It must be accurate, with all necessary information pertaining to the property clearly shown. It is not unusual for delivery dates to be rather optimistic. Neither is it unusal for delivery dates to be totally unrealistic. You need the delivery date to form part of the contract. Ask for this and the date may well be changed for something a lot more realistic.

If we now look at the question of paying such a large amount of money in advance. Is this wise. The answer is - of course not! and if it is at all possible its best avoided. However, you cannot do this - the system is now in place all over Spain. If there is any doubt, then you obtain a bank guarantee which will protect your investment against failure for any reason. Of course, its perfectly natural for most buyers to be concerned about paying this amount of payment in advance but the Spanish government have now  recognised this concern and now require all building companies to be insured against their failure to complete a job for whatever  reason.

What about NHBC or similar
All new Spanish building should carry 10 year guarantee. Unlike the UK, where this is through the NHBC, an organisation made up of building construction companies. In Spain, it is insurance companies that carry the guarantee.  It's a genuine guarantee that you can rely on and which is unlikely you will ever have to use.
 
Choice
When you buy a property built by any Spanish company there is usually a choice of finish for areas like kitchens, bathrooms, and floor tiles. Some will also  offer a choice between gas or electricity or combination of both for water heating and cooking.

Today in Spain, buyers of new properties can expect as standard all the features of northern European homes, quality construction, double glazing, insulation and security. Property is  becoming more expensive but it can still represent good value for money when compared to that available in the UK.

Whatever happens, there is still time for you to acquire a secure and lasting investment which will bring years of pleasure for you and your family or provide a retirement in a country with a climate envied by most of the world.

About Us

 pocomed ebook.pdf

back to home

Join our FREE Email List

Site Map
About Us  Matter of Trust Living Abroad Buying Guide Buyer Beware Costa Almeria Costa Calida Lorca Golf Resort Pueblo Salinas Torre del Obispo Frondoso Valley Brazil  Almanzora Country Club Properties for Sale Resale Home Land for Sale New Homes (Off-Plan) Selling Your Property Pocomed Reports Spanish Phrase Book FAQ Ask an Expert Testimonials Free Newsletter Why is this Info FREE Referrals Guest Column Blog Holiday Apartment Rental Working With Us Links Policy Weekly Humour ON THIS DAY Mortgages On This Day Previous Contact Us Investing in Spain All About Spain Informal Viewing Trips Living Abroad Retirement in Spain