Building Services
Guide to Constructing a Property in Spain
If you are going to construct a property in the following areas Ciudad Quesada, Rojales, Formentera, San Fulgencio, Benijofar, Daya Nueva, Daya Vieja, Algorfa, Almoradi, Los Dolses, Villamartin, La Zenia, Cabo Roig, Dehesa de Campoamor, Las Rambles Golf, Albatera, Dolores, Crevillente, Catral please read and study the following.
Before you start
Choosing a builder in Spain (very Important you know and must do)
In no other business sector in Spain are there so many pitfalls & cowboys than in the construction industry. Although there are many strict rules & regulations, as usual in this area there isn’t the man-power to enforce them, these leaves you, the consumer, with the problem of making sure the company you use is completely legal, & We mean completely.
Failure to do this can leave you open to all sorts of problems that include everything from inferior workmanship through to being prosecuted if someone illegal has an accident whilst working on your property, * in the case of death this would change your life completely and the possibility of a demolition order being placed on your property
Accidents do happen all too frequently & if you employ an illegal company, or a legal company with illegal workers, as owner of the property you are liable for any accidents as the head of the company.
The follow is a list of important question you must ask any builder before letting them work on your property, & ask for proof of their answers.
Are you a legal company? (If they say you do not need building permission it is a good indication they are not, because believe us you need permission to do almost everything)
Are your workers legal (Contract, Social Security etc.)?
Do you have 3rd party insurance for construction?
Ask how long they have been in business?
Ask to see examples of their work & speak to the clients?
Ask to see more than one example? (everyone can get lucky once)
Always ask for a quotation, not an estimate. (Many illegal builders will give you a price to get the job, but will return and demand more money to finish the project)
Make sure the quotation lists everything to be included.
Always ask for a separate price for any extras before they are carried out.
Ask if the work will carry a guarantee (check this with previous clients)
Does the quote include I.V.A. (VAT), Architect’s project & town hall permissions?
Make sure they are clean in their work; they are working in your home, not a building site!
It’s all too tempting to go with the cheapest quote, but in the long run this could work out to be the most expensive.
Most importantly use common sense, talk to the person who comes round to measure up, satisfy yourself that he understands what he is talking about. Spanish building methods and finishes are very different from English.
Following the above advice should lead to a trouble free experience, leaving you with a finished job that you are please with.
Make Sure the builders are legal !!!!
Constructing a property
Building a property in Spain is becoming more and more popular amongst foreigners both for professional investors and for private people who are looking to get an individual designed holiday home.
Buying a plot of land and building a property will in many cases be cheaper than buying a second hand home and many people like to be able to decide exactly how their house is going to be designed. Apart from the individuals there are many professional investors and associations of private investors who earn good returns on the initial investment by building and reselling properties.
The increase in the house prices over the last years has made it even more interesting to invest in the property sector in Spain. Although the price of plots also has gone up the material and labour force has not increased in the same degree and a great part of the increase in the house prices has gone directly into the promoters/constructers pockets.
The above facts make it tempting to decide to construct your own property or to invest in the property sector in Spain but there are still a lot of different factors and pitfalls that you need to take into consideration.
In this guide you can find basic information about constructing a property in Spain. If you have any questions or need further help we will be happy to discuss how we in Under the Sun Estate Agents S.L. can assist you with constructing in Spain. You can contact us by email (info@underthesuninspain.com) or by filling in the form in our Help & Advice section.
Information included in this online guide;
Initial Steps
All the initial steps you need to resolve before you can start building - like finding and buying the right plot, finding an architect and a builder etc.
Building Process
A description of the building process from designing the property and getting the necessary licenses, to information about building the property.
Financial Issues
This is a short introduction to the financial elements of building a property in Spain including what to be aware of, estimated costs and information about how to finance the construction.
Legal Matters
An introduction to the most important legal things to be aware of during the whole process from the initial phase of buying a plot to the contract with the builder including info about all the licenses needed.
The Building Process
When you have finished the purchase of the plot the next step is to get an architect to design and make drawings of the property. The drawings need to get approved by the board of architects (Colegio de Arquitectos), and are needed to present the application for the building license.
As to the design of the property you can decide if you want to leave it up to the architect or if you want to be involved in the whole design process.
If you are building a property for your own use we can recommend giving a detailed explication to the architect about what you expect. Apart from the physical design of the house you will have discuss details like:
The situation of the house on the plot.
The views you are getting from each part of the property.
The distribution of the property.
The size and number of rooms needed.
If you have any special requirements like need of wheelchair, space for guests,
Extras like pool, garage, storage, tennis etc.
As mentioned it is necessary to provide detailed information and drawings of the property to be able to get the building permit, which you have to apply for at the local town hall.
In the past, it was accepted practice to build without obtaining the necessary licence in advance. A fine would subsequently be imposed which was a relatively low sum. Today this practise has changed as fines are very expensive and the government is paralysing many constructions or even knocking it down.
The architect will normally take about 6-8 weeks to get the design ready for submission to the authorities. The project is first submitted to the Board of Architects for their approval. Once approved the project is submitted to the Town Hall, along with the health and safety project and certificate from the College of Aparejadores. The license (if all the paper work is in order) will normally be ready in about 4 to 6 weeks.
When you have the licenses you will be ready to start the construction but before that you will of course have to find a constructer.
There are many constructers around of different sizes and nationality and most important with different reputation and results / quality of previous work done.
It can be very difficult to distinguish the god constructers from the bad ones and if you don't have previous experience with constructing in Spain the only fact you can use is previous work done.
Although you have a good constructer the most important point is to make sure that the contract with the constructer is covering all important areas including the payment terms, completion date with penalty clause for late completion, construction standards, materials used, etc.
The building process can take everything from 4 months to a couple of years depending on what you are planning to build and the terms of your contract with the constructer.
The process is normally divided into different phases like the fundament, the structure, the roofing, the inside installations and the finishing.
During the construction it can be highly recommended having an independent technical architect (aparejador) hired by you and not the constructer to make sure that the constructer complies with the construction standards given by the architect.
When the property is finished it is important that you make sure that the builder obtain the certificate of completion of the building and the certificate of first occupancy which is given by the town hall as otherwise you will not be able to get a contracts for light, water and phone.
The next step will be to get the new property registered at the Spanish Property Registry, as the title deed only contains the registration of the plot. To be able to register the new property in the title deed it is necessary to make a declaration of new work (declaración de obra nueva) and to provide the full certification of the construction including the building license, the certificate of building completion and the certificate of first occupancy.
Financial Issues
Cost of Land - Cost of Building - Other Costs - Mortgage
Before you start planning to build a property in Spain it is important to take into consideration all the costs involved in the process - from buying the land and paying the constructer to all the taxes and paperwork.
It will normally be cheaper to construct a property compared to buying a second hand property but it can end up being a very expensive experience if all the licenses and contracts are not in order. Below you can find a short introduction to some of the most important financial elements of constructing a property. If you have any questions or are interested in further information about how much your building plans will cost or need help with financing your project please Contact Us.
Cost of Land
The price of land varies considerably depending on the area, the standard of the plot, views and the normal factors that have influence in the price of a house.
Plots in exclusive areas near the sea or golf course will cost about 200-700EUR per square meter and in other tourist areas about 100-400EUR per square. By going further inland you will be able to find plots from about 10-150EUR per square meter.
Apart from the direct cost of the land you should calculate with another 10% to cover the transfer tax, registration of the title deed and notary fees.
Cost of Building
The cost of building a property are again very variable and depends on the quality and type of materials used, the conditions of the terrain, the design and the type of property. Apart from the above factors the price from constructer to constructer differs and it can therefore be recommended to get several offers.
A standard quality villa with garage and pool (200M2) will cost about 500 - 700EUR per square metre constructed and a complex with about 20 apartments of 100 square metres will cost about 700 - 1000 per square metre constructed.
Other Costs
The other costs involved with the construction of a property will be around 25-30% of the construction cost and includes VAT (7%), fees for licenses, architect and technical assistant fees, paper work and legal assistance, getting water, electricity and telephone to the property, registration of the new property etc.
If you are planning to construct a property for your own use there will also be some annual cost of having a property in Spain including property taxes, community fees, insurance etc (please see the section Buy a Property in Spain for further information).
Mortgage
Getting a mortgage to buy land and construct a property is much more difficult than getting a mortgage for a second hand property. The reason for this is that the bank will not have any security apart from the value of the plot until the construction is finished and the real value of the property is estimated. Before granting a loan to construct a property the bank will take into consideration all the possible problems that can occur like not getting the necessary license which can result in that the property will not be finished, possibility of delays and the name and reputation of the constructer. A good way to approach the bank is to have all the papers in order including licenses to build, the architects design approved by the town hall and an outcast of the contract with the builder. If you are interested in further information about mortgage loans or other financial issues of constructing in Spain please Contact Us or fill in the form in the Help & Advice section.
Legal Matters
The Plot - License & Architect - Building Contract - Certificates
Constructing a property in Spain can be very tempting both from a private and from an investment point of view. If you are looking for a house in Spain this option allows you to decide exactly how your property is going to be designed and economically it can be a good investment both for small and professional investors if everything is done right.
That everything is done right is the most important point.
The Spanish bureaucracy and the paper war involved with constructing a property makes it a very complicated and long process and we can strongly recommend getting good legal advice right from the beginning of the process.
It used to be a common practise to start building without obtaining the necessary licence in advance. Today this practise has changed as fines are very expensive and the government is paralysing many constructions or even knocking it down.
Below we have outlined the paper work involved with constructing including the licenses needed, contracts and legal issues. If you have any doubts or need help with your construction plans please.
Contact Us.
The Plot
The first issue you need to look into is to find a plot of land where you can construct your requested property. When you are looking for a plot of land you will have to take a look at the town plan at the local town hall to make sure that building a property is allowed on the plot. It can be recommended to obtain a written confirmation from the town hall stating that the land can be used to build on.
From the town hall you can also find out any restrictions towards the size, the height, the percentage of the plot you can build on and the general plans for the area. If you are purchasing a plot within a community you will also have to go through the community regulations as they can have some restriction towards what you can build.
Having made sure that you can build your planned property on the plot the next step will be to prepare the purchase. Before paying any money you will have to make sure that there are no outstanding debts on the plot and that the seller also is the owner of the plot or have the right to sell it.
The paper work involved with finalizing the purchase of the plot are the same as when purchasing a house (see Buy a Property in Spain for more info).
License and Architect
The next step will be to get the license from the town hall. When applying for a building license the architect has to present detailed information and drawings of the property to the local town hall.
This means that you will have to find an architect and get the design ready before you can get a license to construct.
In general we can recommend to get the architect and a technical architect (aparejador) involved before you finish the purchase of the plot as there can be some technical restriction, which can make it difficult to construct your requested property on a certain plot. If you require help with this please contact us
When you are looking for an architect you will have to make sure what is included in the offer made as it can vary from only the design to including technical assistance and inspection during the construction. You also have to make sure that the exact building description (memoria de calidades) including materials used for the construction forms part of the architectural plan.
Building Contract
One of the most important elements of constructing a property is the building contract with the constructer. The builder will always try to protect its interests and if you are not experienced with these type of contracts your property can end up being of a fare less quality than expected, take twice as long as promised or even worse.
BUILDING REGULATIONS
1.1). Each plot of land containing your chosen property has its own characteristics, in relation to its physical location within the total land area delineated, i.e. a town or city (municipality), which defines it from a municipal zoning point of view. This means that the ultimate use of the land is predetermined (e.g. building with x stories, single- family home with a maximum number of two stories, green area, road, ecosystem, reservation, maritime zone exclusion of any building, etc.). Therefore, a first step would be to investigate what is the municipal zoning of the land one has chosen, this can be undertaken at the local Town Hall. Obviously if one purchases, for example, a 4th floor resale, in a building located in an urban centre, which was built many years ago, the investigation regarding municipal legality would most likely be superfluous, as it would be practically impossible that such real estate property would exist unofficially, or that it is violating the municipal zoning laws. But in this case, it would be advisable to investigate the planned use of the area such as future surrounding developments.
If the plot of land has a property under construction or recently built, and generally with new developments, as well as with rustic land or land with a low building density, it is essential to get information about its municipal zoning in order to determine whether or not the planned use for such property is compatible with the purchaser's plans.
1.2). A separate consideration should be taken with regard to the land adjacent to the seashore. Additionally, with regard to these types of properties, one should consult with another official body i.e. Demarcación de Costas (Coastal Authorities) whose offices are located in the provincial capital, as it controls panning permission for coastal zones Meanwhile, the planning information provided by the Town Hall will inform the purchaser whether or not the plot in question is located in such as zone. An advisable additional step that should be taken is to obtain a report from the Demarcación de Costas, to protect the purchaser in who in the case of dispute between the two authorities, would find the Coastal Authorities' decision rules.
Rustic Land Regulations in Spain (Suello no urbanizable)
Land falling into this category is also outlined on the General Plan, as already mentioned rustic land is largely found in the countryside, usually some distance from the local town in whose area it belongs.
Unlike urban land, where the rules are laid down by the local town hall, it is the regional government who makes the rules regarding the minimum size of the building plot in rustic areas. In this case the authority comes from Valencia and the law requires a minimum area of 10,000 m². Murcia Province allows building in plots of 5000m²
However, rustic land may be sub categorised into three distinct types namely Protected, Restricted or Building land. It does not always follow therefore, that because the plot is 10,000m² or greater that it will be possible to build. These categories are shown on the General Plan available in the local town hall and should be checked before any agreement to purchase is made.
Rustic land tends to be much cheaper per m² than Urban land, the problem is you need to buy many more square metres in order to have a plot large enough to build.
Possible Build Area
The first issue you need to look into is to find a plot of land where you can construct your requested property. When you are looking for a plot of land you will have to take a look at the town plan at the local town hall to make sure that building a property is allowed on the plot. It can be recommended to obtain a written confirmation from the town hall stating that the land can be used to build on.
From the town hall you can also find out any restrictions towards the size, the height, the percentage of the plot you can build on and the general plans for the area. If you are purchasing a plot within a community you will also have to go through the community regulations as they can have some restriction towards what you can build.
Having made sure that you can build your planned property on the plot the next step will be to prepare the purchase. Before paying any money you will have to make sure that there are no outstanding debts on the plot and that the seller also is the owner of the plot or have the right to sell it.
The paper work involved with finalizing the purchase of the plot are the same as when purchasing a house (Purchasing Guide)
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