Taking the pain out of
Spain
A
A new insurance policy could just help agents to sell, safely.
villa in Spain has been an enduring dream for many British people. Many of those dreams have come true and the purchasers have lived happily ever after.
For British estate agents, selling homes in Spain from their UK base has been their own route to riches at various levels, creating a successful market for 40 years. But something went gradually, but
horribly wrong and it wasn’t just over- development or even the recession. Land grab, illegal building, confiscated properties and an apparent inability by the Spanish legal system to address the issues have had a disastrous affect on the Spanish property market and consequently seriously damaged some UK agents’ businesses. The most seriously affected area was
Valencia. About 15,000 British, Belgian, German and French property owners lodged a formal petition with MEPs four years ago in desperation over a 1994 Valencia land and town planning law that triggered 20,000 compulsory purchases of land or property for “urban” development. The law aimed to ensure that local
development plans were not blocked by landowners, but a loophole meant that unscrupulous developers could reclassify rural land as urban without the owners’ permission - giving themselves compulsory purchase rights on foreign-owned homes at a fraction of market value. Euro-MPs have demanded the immediate repeal of these land laws. Spanish Prime Minister Jose Luis Zapatero, visiting the European
56 MARCH 2010 PROPERTYdrum
Parliament in Strasbourg, was warned by MEPs that he could face a campaign to stop EU subsidies to Spain unless he intervenes to stop the confiscation of expat homes. However, the problem is not as
widespread as its impact on the market would suggest. Agents report that many cases have been resolved, the number of owners losing their home is not, in relation to the total number of expats living in Spain, huge. But the dramas and the hype have led to a very real reluctance to purchase property anywhere in Spain.
What’s to be done?
One British estate agent decided to do something about it. Ian Hawkins’ company is Luxury Spanish Villas, is based in Javea, on the Costa Blanca. Ian launched Safe Purchase Spain at the end of 2009 and has received a great deal of support from estate agents, solicitors and private vendors keen to provide financial protection against difficulties in home ownership in Spain. “Spain is still the number one destination
for Britons looking to buy abroad,” says Ian, “but continuing negative press coverage surrounding revoked building licences and demolition orders served on innocent owners has struck a dreadful blow to the Spanish market. Now for the first time, the Safe Purchase Guarantee provides insurance protection against a wide range of problems that can occur after a buyer has completed his sale”.
These problems include such things as
title defects, illegal building licences, access problems, border disputes, community problems, hidden lease agreements, fraud, identity theft, vendors’ debts amongst others. “As far as I am aware, this is the first time buyers of Spanish property have had any measure of protection after they’ve purchased,” says Ian. Estate agents who sell Spanish homes
from any country can become Safe Purchase Certified Partners, signing the Safe Purchase Code of Ethics as well as statements confirming their professional experience and the fact they’ve never been convicted of fraud or financial irregularities. Agents include the guarantee with every purchase but it is also available to people who already own a home in Spain. The guarantee provides cover for 20 years of up to €360,000 in compensation for monetary losses. Underwritten by one of Spain’s largest insurance companies, Caser Segura, it includes title insurance.
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