New Build Spanish Property Under Fire
February 20th, 2009
This month, a petition will be delivered to Number 10, suggesting that Gordon Brown picks up the phone and talks personally with Spanish Prime Minister José Luis Rodríguez Zapatero about Spanish real estate and the UK investor.
The document demands he lodge a complaint on behalf of thousands of British citizens who describe themselves as victims of Spanish property ‘scandals and abuses’. Not only that, it calls on Brown to support a second angle of attack – a request for EU involvement: sanctions, no less. Is the UK love affair with Spanish property ending in recrimination, hurt feelings and the divorce courts?
The petition highlights a more worrying problem and suggests systemized corruption involving developers, agents, lawyers, even town hall officials, and a Spanish legal system seemingly disinterested in making things right.
In Spain, planning decisions relating to urban land are made by the local town hall. Regional government makes decisions pertaining to ‘rustic’ land. According to dissatisfied British investors, local mayors have been giving the nod to rustic developments; issuing building licenses without the legal authority. Huge areas have been developed illegally, and properties sold off-plan. Regional authorities are now intervening, in some cases demanding that properties – some sold, to British investors – aren’t connected to utilities, or in some cases are bulldozed.
Spanish lawyers, meanwhile, are said to have been failing to gain necessary Bank Guarantees… an essential piece of paperwork, according to a 1968 law, designed to hold off-plan purchase deposits in separate bank accounts and force their return (plus interest) if the developments aren’t finished in the agreed time.
According to the organizers, three-quarters of the petitioners have paid deposits on properties now deemed illegal. Almost a quarter have completed on illegal developments. The website’s a compendium of woe… including stories of buyers being whisked by agents in their own cars for meetings with carefully selected lawyers. None of it sounds good.
But for now, the race is on, will investors get any kind of legal redress before the developers go into administration?
Story from Citywire
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