Alex Radford from My Lawyer in Spain recently exhibited and presented at a property exhibition in London with over 4,000 attendees and was struck by the number of people who were worried about the legal aspects of buying a property in Spain. In fact, he noticed a real fear among attendees about the risks of demolition, licencing problems and inheriting debts, which many said was stopping them from taking the plunge and buying a property.
“We had a number of people come up to us on the stand and say that the legal concerns over owning property in Spain were holding them back from buying”, Alex explains. “During one of the presentation sessions I asked for a show of hands of people who were worried about the legal issues when it came to buying property in Spain, a high percentage raised their hands.
The biggest worry that was mentioned was whether their property could be demolished, or whether they could lose their property due to problems with licences or unpaid bills. Other concerns included; buying a property with debts attached to it, and not knowing what they needed to pay in order to maintain ownership of that property.
It is a shame that fear and worry is stopping people from achieving their dream of owning a home in Spain, especially because with the right advice, information and support, you can buy with confidence and full legal protection.”
To support buyers overcome these worries, Alex is explaining what issues can arise and what steps you can take to protect yourself against them.
The Hidden Dangers of Buying a Spanish Property and How to Avoid Them
“Buying property in Spain has unique legal hurdles.” Alex explains. “However, there are checks and balances available to ensure you don’t get saddled with debts, or fall foul of planning legislation problems.”
Here Alex lists the biggest legal pitfalls to avoid and how to avoid them.
- Inheriting the Seller’s Debts (Cargas): If the previous owner had unpaid local property taxes (IBI), unpaid community fees, or an uncleared mortgage, those liabilities transfer to you the moment you sign the title deeds, including up to 5 years of unpaid community fees. However, it’s easy to check any debts, liens or embargoes attached to the property, simply request a Nota Simple from the Spanish Land Registry and it will show you. Your lawyer can then make it a condition of the sale that those debts are cleared ahead of purchase.
- Illegal Builds and Missing Licenses: This is particularly common with older homes or rural properties where extensions, pools, or entire structures were built without planning permission. You need to verify that the first occupancy licence (LPO) has been granted by the Town Hall, as this proves that the property complies with all planning permissions and is legal to live in. If you are looking at purchasing a property which is missing this, you can often legalize it, with the right support. Options include; applying for a retrospective LPO, using a document called a Declaración Responsible to show that the property complies with planning and safety regulations, or an AFO, which protects the property from future demolition orders. It’s important to note, that demolitions are very rare, and that despite some high-profile cases, there are protections in place for owners, even when the correct licences haven’t been secured. However, the correct legal advice is vital to protecting yourself.
- Off-Plan Developer Risks: As is common in the construction sector, developers can run into financial trouble, delay projects indefinitely, or go bankrupt before the property is finished, putting your stage payments at risk. However, off-plan buyers’ payments are now protected with Secure Bank Guarantees. These ensure that every stage payment you make to the developer is protected by a bank guarantee (aval bancario). If the developer goes under or fails to complete the build on time, the bank is legally obligated to refund your money.
Avoiding these issues comes down to strict due diligence and setting up clear professional boundaries from day one. It’s vital to hire an Independent Spanish Abogado, rather than the seller’s or developer’s lawyer. You need an independent, registered Spanish solicitor acting solely in your interests to check the legal status of the property before you sign a reservation contract or hand over any deposit. It’s advised to also ask them to set things up to ensure that community fees, council taxes and rubbish fees are paid on time, to avoid accruing debts that could put your property at risk.
With an independent lawyer on your side, you will be protected from future issues and have peace of mind to enjoy owning property in Spain.
Author Details
Alex Radford is a dual qualified English Solicitor & Spanish Abogado and Partner of My Lawyer in Spain. He is an experienced lawyer with great international and cross border expertise who specialises in international contracts, commercial and residential real estate, estate planning, wills, inheritance and timeshares.
My Lawyer in Spain provide independent legal services in English to anyone with interests in Spain. Whether clients are buying a property, relocating, or simply need a will drawing up, they are on hand to make the process easy. Their experienced lawyers and solicitors can offer quality legal services across Spain and offer clear, practical and reliable advice.
