Beatriz Corredor, the Spanish housing minister, launched a direct appeal to Britons to return and buy up the 700,000 unsold newly built properties of which 400,000 are situated on the coast. In total, between newly built and previously occupied properties, there is in excess of 1 million vacant homes on the market.
The Spanish Government is planning a road show around Britain promoting bargain priced properties and promising a package of legal reforms to restore buyers' confidence as a consequence of all the bad press and horror stories associated with buying property in Spain.
However, whilst the Spanish government is desperate for the return of the British buyer to boost the struggling economy it has to date refused to clean up the past mess of corruption and greed of which many British buyers unfortunately fell victim.
Thousands of buyers over the past 10 years are caught up in complex legal disputes and despite having paid deposits averaging EUR100,000 each they have neither received their completed property nor had their deposits returned.
It is estimated if Spain enforced it laws on bank guarantees for off-plan purchases (Ley 57/68) it would cost the banking sector more than EUR1 billion. Spain 's Finance Minister, Elena Salgado, knows only too well the damage favourable decisions to British buyers would do to the already struggling banking sector and has publically criticised Judges for decisions not in favour of the banking sector.
Other buyers have innocently bought properties believing them to be legal only to be told the property has since been re-classified as illegal because the builder or developer obtained planning permission from a “cash bung” to a corrupt Mayor or Planning Official and as such the planning permission was now being retrospectively revoked and the house possibly demolished.
In Andalucia alone there are approximately 300,000 properties with unresolved planning issues. Recently we have seen Josefina Cruz, the head of the department for public works and housing in the Andalucian regional government, meet with mayors from 14 municipalities in the Axarquia region to discuss the situation of almost 13,000 illegal properties in the Almanzora Valley in Almeria . The outcome of these discussions is that over 900 homes will be demolished and the rest legalised by a new special ‘decreto' or decree to define a uniform set of procedures which would allow these houses to be granted an occupation licence and obtain access to services in a manner described as ‘self-sufficient' making it clear that public funds will not be used to resolve the situation.
With the risk and uncertainty associated with buying property in Spain the only sensible advice is to instruct at the outset an experienced independent Spanish conveyancing solicitor.
Published March 2011
