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Hi,
we bought a property off plan on a development Oct 03 for completion Mar/Apr 05. The builder has not started building yet as we now have found out he has not been given the final permission to build. The agents are saying it was something to do with greenpeace not wanting it built because its near the salt lakes Torrevieja. When we asked why we were introduced to this property if the permissions were not in place the agents said that in Spain quite often building will start before final permission as this is usually just a matter of course.
Obviously we and quite a few others who bought at the same time feel we were very naive but as the agents are a big well known company and we were told they help every step of the way,we would never had dreamed that they would show us something that did not have the proper permissions in place. No-one once mentioned that there might be a hold up so that we were aware of the problem.
If anyone can enlighten us as to the procedures of building in Spain I would be grateful.
Many Thanks
Bernie 🙁 -
Hi Bernie,
Many builders sign private contracts of sale without having building permission. However as a buyer you should never touch any off-plan property that doesn’t already have building permission, confirmed by your lawyer. Obviously it’s too late for you and I understand that you trusted your agent when they told you that all the permits had been granted. However as a golden rule you should never trust agents or developers on this question. You always have to have an independent lawyer (not one recommended by your agent or developer) to check building permission with the town hall, and when buying in Marbella you have to check that the town hall’s permits conform to the regional government’s urban plan. You might consider paying a fully-refundable reserve deposit (of no more than 6,000 Euros, preferably less) that is returned to you in a set (and short) period of time if the developer expects permission to be granted within a couple of weeks, but even this should be avoided. The best policy is not to sign anything or pay any deposits whilst planning permission (licencia de obras in Spanish) is still outstanding.
In your case if the developer hasn’t even started building yet then it must be in breach of contract. If I were you, and this is just my personal opinion, I would cut my losses, demand my payments back with interest, and move on. After all what are your chances of a happy ending with the developer as things stand? But I repeat, this is just a personal opinion and you should check your options with a lawyer.
I have recently become aware that a fair number of people (in certain regions – not everywhere) have bought off-plan only then to wait for months or years without seeing so much as a brick laid. They tend to hang on in there, hoping that something will be built. They don’t want to demand their money back because they know that prices have increased considerably since they signed the contract, and starting again would mean having to look at ‘cheaper’ properties. I understand their motivations but I think they are taking a risk. I would get my payments back as quickly as possible and write off the ‘losses’ incurred by having their funds tied up in an unproductive contract. I think that some of the developers who have made a business of selling off-plan without permits will sooner or later get into financial distress. When that happens I wouldn’t feel very comfortable if they were holding on to some of my money.
Mark
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Hi Mark,
We have asked for our money back but have been told by the agents that the builder is still saying that he is going to start to build anyday now.We have asked to see a copy of the final permission to build which would enable him to do this. 2 months down the line they havent come forward with it cos as we know it doesnt excist. We have asked to be moved to another of his developments but he has not got any of what we were buying left to sell as customers from phase 1 and 2 and most from 3 have had them. We were phase 4.
Because in our contract it says Mar/Apr 05 completion plus 6 month delay clause that takes us up to Oct 05. We have been told by the agents that the builder is saying he is still in his contract so tough luck basically, we’ll have to wait. Yes they did recommend their lawyers but they are no help to us saying basically the builder is right, but I would have thought that they would have known about the missing permissions and the possible implications to all concerned.
Thanks for your opinion.
Bernie -
Hi,
After no building work at all has taken place due to the builder not have the permission to build (something we were not told on our inspection trip,indeed we were told he was starting to build the week after we had viewed), We had to wait 6 months extra ( Oct 05) as stated in our contract to be able to ask for our money back plus legal interest due to the builders breach of contract. This we did through a solicitor.
Jan 06 and the situation is We have today signed power of attorney for litigation for our solicitor to take T********* to court.
It is going to cost 10% (about) of what the builder owes us for us to do this. So basically that means for us personally it is going to cost us about 6,000 euro. Put this together with how I****** are trying to rip us off on the exchange rate for the money they now say they hold for us ( which they previously said the builder had it all) and that comes to about 7,000 euro.
Not bad for putting your trust in a big uk company. Yes I know people will say well you should have checked everything out but you are told that they have done all the checking and that this is one of the best builders in Spain etc,etc. Hindsight is a wonderful thing. Foresight is much more sensible.
Bernie
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Hi Bernie,
You are embarking on the nightmare several members of this forum are in….and it is a nightmare!
Do you have a Bank Guarantee? This is essential to get. Your lawyer should have secured one for you at the signing of your contract. Ours did not do this for us even though they assured us they would as part of the service!! If the contract has expired then you need to get a Requerimiento Notarial. It declares your contract null & void. Like us and others, you have been ripped off by agents, lawyers & builders. A common story in Spain it seems. They all come up with everything but the truth. That is something you have to try and get for yourself I’m afraid. Are you able to get in contact with any other “buyers” in your situation? Several of us here have “found” each other and my husband & I have found great support & friendship from the other people concerned with our “ghost” development. It helps to keep us sane 🙂
I think the first thing you must do is find another firm of trustworthy lawyers…easier said than done. We have run into ethical problems with our second set of lawyers. That in itself is very stressful. You say you have signed power of attorney to your lawyer to start legal proceedings. You know it can take years in Spain for this to happen and a lot of money. That is the only reason we are not going down this route…YET! This whole thing has already cost us a lot of money. We will definitely come out with a big minus in monetary terms even with the Bank Guarantee.
I really wish you luck with this. All I can say is DO NOT depend on your lawyer to sort this out. It is very much down to you to be on top of this at all times.
If you are interested, take a look at my original posting on here. I think it is entitled “Santa Maria Golf, Greenhills, Elviria” Also “the latest instalment of our nightmare.” There are other other postings from “Sophia,” and “Barbara & Katerina” which you may find interesting.
This is an excellent forum, the best you will find. We have learned so much from it.:D Good Luck.
Claire.
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Do you know what I just DO NOT understand? Why is it in these all too common situations of no build, that the company does not return all our money immediately. WHY? WHY? WHY? It is outright theft. WHY should we have to go through all these legal EXPENSIVE proceedings to get back what is rightfully ours? It is outragous!!! 😈 😈 😈
I know I am “ranting” about a seemingly “common” situation, but it is quite unbelievable that this happens in a so called “civil” country.
Rant over!!!….for the time being.
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Hi Claire,
I don’t think you should be apologising for ranting – you are perfectly justified.
I hope that this site is sufficiently high profile to be read by people who can campaign for change. It is reassuring that a number of lawyers read and post here. The more these problems are discussed, the more publicity it generates, the better the chance that eventually something will be done to stop these corrupt developers.
Keep up the good work 🙂
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Bernie
We are in the same situation as you. Paid money in 03 – not a brick has been built.
We are going out tomorrow to see our lawyer re. suing, but as an aditional line of attack, we are going to the police.
In a phone call we made a couple of months ago to them, telling them the situation, they responded quite clearly that this is actually classed as a ‘crime’ and fraud, and that we should place a ‘denuncia’ with them (a report). They told us that it is an arrestable offence as it is classed as theft!
All very encouraging, but the proof is always in the pud!
So this trip, we are actually going to present ourselves at the same police station (in Marbella) and see what happens.
Hopefully, Claire, we can put a satisfied smile on your face. 😈
WATCH THIS SPACE! …..(back in a week). -
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Hi Claire,
It is wrong that we should have to take this course of action when it clearly states in the contract that failure to complete by specified time (set by the builder in the first place) results in the builder paying back monies paid plus legal interest.
I’m sure if it was the other way round and we hadn’t made our payments when they were due, the builder would be quick enough to get them off of us.
What makes me so mad is you have to wait the 6 month extra even though the builder still hasn’t got the permission to build so he knows full well that he will be in breach of contract. Then he has the cheek to turn round and say he doesn’t want to accept our cancellation as it’s not his fault he hasnt got the permission yet!! Unbelievable!!I wish everyone in the same position all the best of luck. We need it.
Bernie
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