The value of payments outstanding to Communities of Owners around Spain has declined for the first time since the financial crisis of 2008, reveals a new report.
Most homes in Spain are part of a Community of Owners, or Comunidad de Propietarios, in which owners all contribute to the upkeep of communal areas, similar to a condominium in the US. During the crisis more and more owners have been falling behind on their payments, leading to a sum total of €1.86 billion in outstanding payments in 2015, according to Spain’s Association of Estate Administrators (CGCAFE).
When some owners fall behind on their payments, they freeride on those who don’t, and the whole community suffers. Banks that repossessed homes are some of the worst offenders when it comes to non-payment of community fees, though many families in dire financial straits have also failed to keep up to date with their payments.
In another tentative sign that things are improving, outstanding payments to Communities fell by 2.3% in 2015, the first decline since the crisis started, say CGCAFE. Banks reduced their debts by 15%. So more owners are keeping up to date with their community fees.
Even so, some 43% of communities still have a problem with unpaid fees, so it’s something to check out before you buy. The average value of payments outstanding for communities is €1,377.