Issues with Luxury Property Constructors in Costa Blanca: What You Should Know. Image: Shutterstock/ronstik
Buying a home is a significant moment in everyone s life, during which it is advisable to be properly advised. When the property you intend to purchase is a Luxury Home or a Luxury Villa, a legal review of the situation becomes even more important to avoid compromising large sums of money. Recently, several clients have contacted us for the same reason. In their search for a luxury villa, the proposal they received has been the following: first, to buy a plot of land; then, to construct a luxury villa designed by an architect, along with a construction contract with a high-end builder, etc. However, this approach entails a series of risks that warrant careful analysis and that we will discuss in today’s article.
Understanding the Differences: Purchasing Off-Plan vs. Becoming a Developer
Many clients find themselves confused about a crucial aspect of buying a home. There are two primary methods for completing a property transaction. First, you can sign an off plan property purchase agreement with a developer. The developer/promoter is legally obligated to guarantee your payments and refund any amounts if issues arise or if the project is not completed on time. This arrangement offers substantial protection for buyers.
Alternatively, you may choose to buy a plot of land and enter into a construction contract with a builder. In this scenario, the situation changes significantly. Once you acquire the land, you become the legal owner and, consequently, the “developer” or “promoter” of the project. This distinction carries substantial legal and financial implications, as we will explore further.
The Risks of Being a Developer in Spain.
What happens if I become the developer? Basically, that you will be held legally accountable for everything. This includes interactions with local authorities, public entities, and more. If any issues arise concerning permits, construction compliance, or administrative authorisations, you will assume complete liability. This reality emphasises the importance of thorough planning and adherence to regulations, as the financial and legal repercussions of any missteps can be significant. Making sure that the project sold to you by the builder can be legally executed is key. Checking with the Town Hall the urban planning regulations applicable to the plot, what planning permissions are required, and what other authorisations you may need is of the upmost importance.
Engaging a legal expert to review the project can also help identify any potential issues before they arise, giving you peace of mind as you move forward with your investment.
At White-Baos Lawyers, we have extensive experience guiding clients through the complexities of Luxury property purchases. Contact us today to ensure your investment is protected.
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Carlos Baos (Lawyer)
White Baos.
Tel: +34 966 426 185
E-mail: [email protected]
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