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Hi Mark/Forum members,
What is your experience in terms of number of investors that complain that the size of their property does not match up to that on the plans. ?
Is it common practice for developments to extend for years before final completion. ?
Can you advise of any safe guards that I can request through my lawyer to ensure I am covered for either eventuality. I have not signed any contracts yet.
Regards
Kalab -
The best safety measure to take against buying off-plans is to….er…well not buy an off-plan. I say this with having experience of numerous off-plan purchases in Spain in the last 2 years. With hind-sight, there was no logical reason in buying off-plan in ANY of those cases. I base this on the following thoughts ….
– people are lured into off-plans with promises of upto 30% capital appreciation by the time the property is built. This is no longer true of Spain. Therefore, the financial gain element of off-plans is non-existent in my view.
– people are often more in love with the romatic idea of buying a property overseas, than with actually owning one. Buying off-plans caters for this fantasy. See a re-sale property and imagine yourself spending holidays there or living there – this will give a better picture as to whether one really wants to own a property in Spain. Having the physical property there before your eyes, with bricks and mortar in full view is a very different proposition to seeing a nice architects plan.
– ask yourself what are your reasons for buying off-plan? Is it to make money? If so, then stay clear. Is it because there are no re-sales in the exact location/development where you want to buy? If so, then wait for the development to be built, and then buy from one of the many resales that will come on the market once other ‘investors’ try to off-load their off-plans before completion.Just my 2-pence worth.
Punjabi
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@kalab wrote:
Can you advise of any safe guards that I can request through my lawyer to ensure I am covered for either eventuality. I have not signed any contracts yet.
Unless you are a very large investor, or the development is very small – your lawyer is unlikely to get anything other than the standard contract from the developer. In general these contracts read along the lines of “We, the developers, promise to build you a property of some description sometime. Your statuary rights are not affected”.
Oh, and what Punjabi said.
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I can’t give you any firm figures as to how many buyers run into this problem. However my feeling is that it happens far too much. The best way to avoid it is to insist on a high level of detail in the documentation that forms part of the contract you sign, and let the developer know, in a polite way, that you will take legal action if the property doesn’t match the plans. But you can never be 100% sure it won’t happen.
New developments are usually delayed by some months – I think I have read that 80% are. However when the delay stretches to years it is normally because the developer doesn’t have planning permission. Don’t even think of buying on a development where the developer can’t show you planning permission (licencia de construcción).
Mark
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