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It would be intresting to know how forum user feel about the fact that how much the Spanish Councils/planning department ineffeciency contributes towards the developers starting projects without planning permission etc.
If, I am a developer and buys a piece of land and presents the Council with the plans etc for consent. The Council takes years to grant permission for me to commence works. As a developer I am faced with the following
1) I have paid a lot of money for the land, on which I am paying Bank interest.
2) Market momentum is going against me.
3) My tried tested and trustable subcontrating company is not waiting for me and have taken up another project.
(In Uk certain Coucils are taking four to six months and the Industry is up in arms )
I feel that in Spain, all goverment, semi goevrnment, Quangoes, supervisory bodies have not pulled themselves up to current realities. While Private sector has moved on and as a result the gap between the two has reached a unreconciled state. This in turn has created a free for all.
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My comment on this Shakeel is that in the UK building of any sort, be it a new build, extension etc, cannot begin until planning consent is given. In cases where this has happened, the builder(most often self build) usually has to pull it down. I doubt professional developers would start a project until all licences were in place.
In Spain, especially over the last few years, the developers have just started the buildings without the planning consents because for years that is how they operated…and got away with it.
I don’t think it is necessarily the Spanish planning departments inefficiency that is the problem. IMO, it all boils down to the arrogance & greed of the developer.Having to pay for land before planning is granted goes with the territory. It’s a gamble. If it is necessary for the developer to have a mortgage on the land, be sure the prospective buyers more than cover this money in the end price they pay for the villa/apartment!
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Claire: Whilst I agree that in Uk the works will not commence. Until recently the planning department had turned around an application in two to three months. Also in UK the construction Industry in structured in different way. I can assure you that in Uk small extensions do carry on without permission and I think after 3 or 4 years if the council does not object/take action. A permission is granted retrorespectively.
Large projects such as in the costas will not commence. The kick backs in Uk are alive and well, they may be in the form of free holidays, swiss bank accounts, gym membeship, rugby/football trips etc)
Any unreasonable delay. The Industry will be onto the housing ministry
( They would not have wasted time when John Presscot was there as they were perhaps afraid of being punched)The compnies in UK are very large public companies and not owned by family or business partners and as a result are not starved of capital that they require to build. Due to demographics they have a large land Bank so their capital and resources are allways employed in some project in some part of UK, whislt the planning permission follows on other projcts
Yes, the land mortgage etc goes with the territory and as you said the risk. Like in all buinesses you take a calculated risk but if all this is derailed by the Councils due to their incompetance, what is a developer suppose to do.
As you can see from the subject I am playing a devils advocate here.
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Uhhh, where do I start here?
It is said “Spanish Councils/planning department ineffeciency contributes towards the developers starting projects without planning permission etc.”
Maybe so, so who or what do you blame in UK, when applications have to got to appeal, then maybe the Courts. Is that just inefficiency, or the rules and regulations regarding contamination, ground conditions, TAN15, highways, public meetings?“If, I am a developer and buys a piece of land and presents the Council with the plans etc for consent.”
So perhaps they should be purchasing Subject to Planning, as is often the case in UK. Also, this is something that developers take into consideration with their projections.“The Council takes years to grant permission for me to commence works. As a developer I am faced with the following
1) I have paid a lot of money for the land, on which I am paying Bank interest.
2) Market momentum is going against me.
3) My tried tested and trustable subcontrating company is not waiting for me and have taken up another project. “1) So what, you may have paid a lot of money for the land, but business is always a gamble.
2) Reputable developers “read” the market quite well, hence the trading figures of UK developers make good reading.
If they do not get their projections correct, it is their fault.
3) So a reputable developer only has one “tried tested and trustable subcontrating company”?“(In Uk certain Coucils are taking four to six months and the Industry is up in arms )” Certainly not all Councils and certainly not in all instances. The planning procedure is painfully slow for anything other that the straightforward (have an old house on a site and want to replace with new house), otherwise, ground conditions, highways, disabled access, building lines, environmental issues all kick into force.
“I feel that in Spain, all goverment, semi goevrnment, Quangoes, supervisory bodies have not pulled themselves up to current realities. While Private sector has moved on and as a result the gap between the two has reached a unreconciled state.”
No, it is just that in UK, business tend more or less to stay within the “tramlines”, whereas in Spain it seems that many a developer will do as he wants and face the consequences later. As has been done on many major developments, both commercial and rsidential, in UK. With some of the culprits being the major household names, i.e. a Supermarket built without full consent (” in the UK building of any sort, be it a new build, extension etc, cannot begin until planning consent is given. In cases where this has happened, the builder(most often self build) usually has to pull it down.), and still stands and trades!
I most certainly believe that it is the blinkered purchasers that has worsened the disaster that is coming to light in the property development sector in Spain, although it is something the Joe Public does not seem to want to accept. maybe because they are one og the many who have been caught out, even if as a result of their own blindness. -
I can assure you that in Uk small extensions do carry on without permission and I think after 3 or 4 years if the council does not object/take action. A permission is granted retrorespectively.
Shakeel, as I understand it ,IF the planning department finds out about any building that did not have planning permission(usually from an aggrieved nieghbour!) even after several years, the applicant still has to go through the necessary channels to apply for retrospective planning permission. I don’t think it is automatically granted. They can still be told to remove the structure. Even some conservatories need planning permission. We have to apply for planning permission to carry out even the smallest trimming back of the trees in our garden! Our next door neighbour didn’t know this and was promptly issued with a £2000 fine! They pleaded ignorance and got off with a severe dressing down. It was absolutely ridiculous as a few years later you cannot even see where it was cut back!
However long the Council/Town Hall take to grant these licences, it should not give the developers a reason to go ahead and build, regardless,IMO. Too many people get hurt in the backlash.
All credit to you Shakeel for trying to balance the reasoning. 🙂 -
@mg wrote:
As has been done on many major developments, both commercial and rsidential, in UK. With some of the culprits being the major household names, i.e. a Supermarket built without full consent (” in the UK building of any sort, be it a new build, extension etc, cannot begin until planning consent is given. In cases where this has happened, the builder(most often self build) usually has to pull it down.), and still stands and trades!
.Can you give an illustration of which supermarket and where, mg?
Maybe it still stands because it got retrospective PP. Maybe there were just minor irregularities such as lighting ,signage.etc. 😕 -
Hi Shakeel
Most developers do not pay for the land UNTIL they are granted permission. What they do is the put a deposit down (of 10%) with clauses in the contract that they will only pay the rest once they have completed licences and if they DO NOT obtain the licences the owner repays all the deposit money (certainly in this region thats how they buy land) so who is taking the risk here?
Also a lot of smaller developers do what is know as a “Cambiar De Obras” – ie the owner Sells the land but instead of taking money he will take a percentage of the properties built (or the money once they are sold). Thus the developer doesn’t have the cost of the land to consider. This is beneficial to the owner because he normally gets 30-40% of the properties – which in 3 years time (historically of course) are worth more than they are now so he has an appreciating asset also. And he usually gets to choose the best properties (aticos, comercials etc)
Also most of the developers I know (and that amounts to somewhere in the region of 50 or so) have many plots of land and hold onto them for years.
The larger developments and urbanisations tend to buy Speculative land at ridiculously low prices, then push for an urbanisation because doing this they can sell small plots of urbanised land for the same price they bought the whole plot for in the first place.
Finally most of the developers are in the trouble they are in because they have tried to capitalise all their assets at once – ie build on all the land they owned at once, which means they don’t want to wait for permissions etc because they will miss out on all those foreigners coming over – it is also the reason why they cannot complete anything because they have all their money tied up in one almighty building phase instead of making smaller projects work and finish them and get all relevant permissions.
As MG and Claire say – buying the land is part and parcel of the development and they KNOW how long it takes to get permissions because they have been doing this for years. Now they are getting caught out poor souls they are losing money. But it is their initial greed that got them there in the first place.
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And maybe it was that one of the market leaders who had a conditional consent to construct a new store, the condition being that the older store, the consent for the use was surrendered. However, the demolition never took place, relaxation of the condition was turned down and think that the matter is to end up in the Courts.
No, it was not about signage, lighting or access, purely useage.
Spanish equivalent being should a 7 storey block be constructed where only consent for a house?“Most developers do not pay for the land UNTIL they are granted permission. What they do is the put a deposit down (of 10%) with clauses in the contract that they will only pay the rest once they have completed licences and if they DO NOT obtain the licences the owner repays all the deposit money (certainly in this region thats how they buy land) so who is taking the risk here? “
Or buy an option to purchase, whereby a non-retunable deposit is paid and a sale figure agreed to. The option period would last say 2,3,4 or 5 years, which when the developer gets consent for whatever, he can choose to buy at the agreed price, or just walk. -
It is worthwhile pointing out that the state of play with council planning gives a very strong advantage to local builders and developers.
They are often able to start work on a project after receiving just a ‘nod’ from their friend in the council planning office.
Outsiders are forced to queue at the planning office door and then wait for planning documents to work their way slowly through the intray – while insiders can just come and go as they please and get their paperwork fastlaned.
This is probably true everywhere in the world – but in Spain no attempt is made to hide local favourtism.
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@shakeel wrote:
Rawlins: Yes its every where its the school tie my boy and in the case of of spain the scholl sombrero.
At least in Spain its not done in a devious, holier than thou attitude. Its on your face, take it or leave it and you know where you stand.
Yes, I agree. It is all very open. 😀
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