Purchasing property off-plan in Marbella has made a dramatic come back, with developers quick to offer properties before they are constructed and buyers similarly quick to purchase at a lower cost, pre-development. If you are considering buying off-plan, here are some suggestions to bear in mind when purchasing a Property Off-plan in Marbella to make sure you keep your finances safe and your rights are protected.
Recently certain laws have been introduced to offer maximum protection to buyers who are purchasing property off-plan in Marbella, obliging engineers to give a bank assurance to all installments made by the buyer for the property. Basically, the bank ensures a full discount to the buyer if the construction is not finished. These legislations were recently updated in January 2016 and the government began to apply the existing law with some amendments.
Purchasing A Marbella Property Off-Plan:What You Need To Know
In a bid to provide off-plan purchasers with extra protection, new legislations were introduced at the beginning of this year, which basically amends the law with regards to bank guarantees: Law 20/2015 (of 14 July 2015) replaces the Law 57/1968 and states that from 1 January 2016 bank guarantees will only be enforced for payments once the developer has demonstrated that the necessary planning permissions for construction have been approved. This not only protects the buyers financial investment, but also gives them piece of mind that everything is being done legally and by the book. Banks and insurance companies have until July 2016 to make revisions to existing guarantees, in order to reflect this amendment. This obviously means that any payments made by a buyer to the developer prior to planning permission being granted will not fall under said guarantee. Additionally, these new and improved rules clearly state that the guarantee provided by the bank will expire two years after any breach of contract if the buyer does not make a claim against the developer within that time frame.
Making A Reservation And Deposits
When you have discovered your ideal property and are sure you want to proceed with a purchase you will be required to pay a reservation deposit to the property developer to save the property you have chosen until the private purchase contract is agreed upon.
The underlying deposit that you are required to give is typically between 3000 euros and 6000 euros for a flat yet can be as much as 50,000 euros to 100,000 euros for a luxury villa. Said deposit is typically non refundable and in the event that you choose not to proceed with the purchase, you are probably going to lose the cash. After the reservation deposit has been placed the purchase agreement is normally drawn up and enforced within a period of 14 days and you will then be required to make the first of the payment installments, which can be anything from 10% to 30% contingent upon the agreed installment plan. For your assurance, any sums paid to the developer ahead of time are lawfully required to be insured by the engineer either through a bank guarantee or protection by an insurance you have taken out.
These are the first two steps you must understand before deciding to purchase a property off-plan in Marbella or the surrounding areas. It is always advisable to seek advice from a trusted real estate professional before entering into any legal agreement when it comes to property.