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 The
Spanish real estate crisis took a new turn recently, with the demolition of
a house in Vera (Almeria) owned and occupied by British pensioners.
Vera (Almeria) Demolition.
The couple, Mr and Mrs Prior, are stated to have bought in
good faith and the Vera Town Hall are reported to have admitted that they
issued a building license in 2003.
The Regional Government claims that, less than a year later, they
successfully petitioned the court for a demolition order, which the Vera
Town Hall refused to carry out. Eventually they were ordered to execute the
demolition order themselves and the house house was demolished on 9th
January 2008.
According to press reports there are hundreds of thousands
of illegal homes in Spain, many of them owned by foreigners and this article
examines the background and history of the problem.
Article Overview and Bookmarks
Looking at all the news items published so far, which can be
seen in other articles -
Extracts from Various Press Items.
Translation of Information Provided by the Regional Government to the
European Parliament.
- some important facts emerge:
1. The Various Orders from the Court:
According to the press reports the Mayor of Vera stated that the demolition
was carried out whilst appeals were pending.
Whereas the Regional Government states that the court ordered the demolition
three time and makes no mention of appeals.
2. The Validly of the Building License: Vera Town Hall states
that the property complied with all the necessary conditions.
The Regional Government claim that the license was not valid because the
only building permitted on the land was for agricultural purposes,
furthermore they claim to have informed Vera and obtain the first court
judgement in less than a year.
It is not when the Town Hall actually informed the owners (the Priors) -
perhaps they would have had time to prevent the construction!
3. The Regional Government suggested that the Priors should
claim for damages against Vera Town Hall.
Meanwhile it is reported that the Town of Vera has made a property available
for them for as long as they need it.
COMMENTS:
Obviously it is too early for the real truth to be revealed
but I would imagine that the Priors are considering a claim for damages.
The Regional Government of Andalusia is one of the Spanish autonomous
states, has a delegate in the European Courts and an expert legal
department.
Their report meticulously cites articles of state law and the Spanish
Constitution. However, there may have been omission.
Initially it would seem that the Priors are blameless, acted in good faith
and the issue relates to a conflict between the Town of Vera, the Regional
Government and perhaps the State.
Sadly, the Priors have lost there home and have had to
witness the distressing spectacle. Fortunately Mr Prior seems to be none the
worse after his trip to the clinic and, at least, the Town is temporarily
looking after them by providing temporary accommodation.
Nevertheless, if the Priors are not to blame, then someone
has to pay, be it the Town of Vera, the Regional Government or the State,
and this has to be resolved quickly.
It also has to be remembered that there are reported to be 11 other
properties pending demolition in the same area and many, many more
throughout Spain.
What we have at stake now is both the State's reputation as
"a global champion of freedom"
(1) and
it's administrative credibility.
(1)
CIA World Fact Book, Spain
Spain is a democratic kingdom and the king is head of state,
parliament is elected by national vote and the prime minister forms a
cabinet - very much like the UK!
Unlike the UK, there are 17 semi-autonomous regional
communities and 2 autonomous cities.
Within each community are municipalities, which elect a council (headed by
the mayor) and the regional delegates to the local parliament.
Foreign (European) residents may vote in municipal elections
but not national or regional.
The law is decided by the Madrid central government, within
the parameters of the Spanish Constitution, and passed down to the regional
governments who decide how to administer the law.
Wikipedia: Autonomous Regions of Spain
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As far as town and country planning are concerned the legal
structure is similar throughout Spain.
Each municipality decides on its urban plan (PGOU - Plan
General de Ordenación Urbanística) and this comprises different zones
e.g. urban, rustic etc.
The municipality is free to decide on its own development, in compliment
with state and regional regulations, and submits the PGOU to the regional
government for approval.
Important to remember here is the "pecking order" - state, regional,
municipal.
There are some important land classifications to be
considered -
a) Casco Urbano: This is the main
town area where a certain infrastructure network is obligatory and there
certain regulations which specify plot size, height and usage.
b) No Urbanizable: Rural land outside the main town area.
c) No Urbanizable Protegido:
Protected rural land outside the main town area.
Houses may still be constructed on b) and c) and regulations
have changed over the years. The minimum plot size was 2,000 metres, which
was later increased to 5,000 and is now 10,000.
Currently habitable houses may only be built if the usage is for
agricultural or similar purposes.
Sheds, barns, stores etc. may also be built for agricultural purposes.
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Over the years many habitable houses have been legally built
that currently do not comply with the planning regulations, even on
protected land.
In some cases even agricultural buildings have been made habitable and ruins
restored.
Currently many rural properties do not comply as far as
infrastructure is concerned. Many do not have water or electricity, waste
disposal is via a septic tank & soak-away and poor roads make the properties
inaccessible for refuse collection.
One function of the PGOU is to resolve this lack of
infrastructure and the municipality may decide to urbanise a rural area.
Generally this only happens if a developer is interested in building because
the existing infrastructure has to be brought up to date and this is what
caused the so-called "Land Grab".
Normally, when a rural area is urbanised, there are existing buildings and
owners are obliged the give up land (for roads, public buildings, etc.) and
partly fund the cost of providing the infrastructure.
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A municipality is semi-autonomous in the respect that it's
funding is provided by the local rates (IBI), value added tax (from the
increasing value of properties in the town) and from building licenses
(typically 5% of the building costs).
Building license fees are vital for expanding municipalities as,
unfortunately, are bribes and favours required by dishonest councillors.
The Spanish building boom got underway during the early 90's
and was fuelled by the availability of cheap mortgages and interest from
foreign property investors.
Many municipalities decided to get in on the act and over-zealous and
corrupt councils issued building licenses for rural land that was outside
the jurisdiction of their PGOU, probably with the idea that these illegal
licenses could be resolved eventually.
Another issue affecting the problem is the Coast Law (Ley de
la Costa). This was enacted in the late 80's and set up a 100 metre control
zone. In many cases this law has not been observed and the state is now
examining a revision, increasing the control zone to 350 metres.
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Overall there has been a deluge of disobedience at municipal
and even regional level and finally the state has started to act.
A special prosecutor has been appointed to investigate urban corruption,
some local councillors have been charged with accepting bribes or favours
and there are many more cases under investigation.
The most serious so far is Marbella (also in Andalusia), where most of the
town council are facing prosecution and the state have replaced them with a
team of administrators.
The state has also insisted that the regional governments
investigate all case of illegal building and regularise or demolish them.
Properties without building licenses or with illegal ones can often be
regularised retrospectively but the main issues here are:
a) Who pays for the demolition if the illegal building
license cannot be regularised?
b) The owners of the property may well have acted in good
faith throughout and be entirely blameless. In which case they can sue
those responsible for compensation. In the worst cases small
municipalities could be faced with compensation payments for €millions but
the only way they could pay would be to increase the rates, so that the
burden fell on other ratepayers. This could cause massive depopulation of
the town and devaluation of all the properties.
c) In the case of regularisation and establishment of a new
urban area, who pays for the infrastructure?
This could lead to another round of "land grab" with owners having to
contribute towards the cost and having land appropriated for roads etc. -
there seems to be no other solution!
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Although planning irregularities are fairly widespread along
the Mediterranean coast it has not happened in every town and, in lots of
cases illegal building licences can be resolved.
Most certainly, now that the regional governments have made it clear that
they intend to impose discipline, the municipalities concerned will be
rushing through revisions to their PGOU's.
With so much in the international press about "Spanish
Property Bubbles" and "Falling Real Estate Values in Spain" the industry has
taken a tremendous hammering and, with the falling value of £sterling
against the Euro, it is getting little respite.
Will news of more demolitions and further development
scandals provide the last nail in the coffin for Spanish real estate?
I think not because there is still a tremendous amount of interest in real
estate in Spain and buyers seem reluctant to commit until falling real
estate values level out.
In some areas these values already seem to have levelled out and nearly all
of the problems, of illegal building and falling values, are unique to
developing areas
My own area exhausted land for new building more than 10 years ago and most
properties available are resale up to 35 years old.
This is the Moraira (Costa Blanca) area but there are other towns where
development is well established.
Details of Property for Sale in Moraira.
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Legal issues concerning the conveyance of Spanish property
are very complicated. Most foreign buyers would not contemplate property
purchase in their own country without employing a lawyer.
This is even more important in Spain. Some further advice -
a) Buying in an urbanised area, within the town, is fairly
safe, especially if the property is resale. Nevertheless, proper searches
should be made for debts and the registration validated.
Even so there is still the risk of land appropriation for road widening,
which is common in most countries, and costs for updating the
infrastructure, which seems unique to Spain.
b) Rural properties are very risky, especially if the
property in new and there are other similar properties around.
Additionally there is always a risk that the area might be developed in
the future, involving land appropriation and extra costs for
infrastructure.
It is difficult to see how anything but a fairly old rural property could
be legal bearing in mind, that in recent years, these could only be
built for agricultural purposes.
c) Bank surveys are very thorough because they don't want
to lend money on a property that has the risk of demolition.
Even for those who don't really need it, getting a small mortgage would
make sense.
d) Always employ a lawyer (abogado) or API (agente de la
propiedad inmobilaria). Always get a bill and or contract with IVA (VAT)
and don't ever let anyone convince you otherwise.
It is not possible to sue for negligence or non-performance if the IVA has
not been paid.
WikiHow | Avoid Investing in Illegal Spanish Property
If you have the slightest suspicion about the legality of
your property then find a good lawyer or API as soon as possible.
Remember that an escritura means no more than that you own the property.
If you own a rural property, built within the past 10 years
or if you have knowledge of any doubt over the legality of the building
license then do it immediately.
Don't listen to anyone who tries to
convince that it won't ever happen!
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© 2008 Moraira-Info.com
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Links to other articles about
the Vera (Almeria) Demolition. |
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The Vera (Almeria) Demolition. British pensioners, Len and Helen Prior, have had their
home demolished in Vera (Almeria) after having been allowed two hours to
remove their furniture and belongings.
Mr Prior, who has a heart condition ......
The Regional Government Report to the European Parliament The Regional Government claims that, less than a year later, they
successfully petitioned the court for a demolition order, which the Vera
Town Hall refused to carry out. Eventually .....
The Vera Demolition - Review and Comments
Looking at all the news items published so
far, which can be seen in other articles, some important facts emerge. 1. The Various Orders from the Court:
According to the press reports the Mayor ..... |
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