Gecko Towers
In searching for your Marbella property, you may have seen that over the last few years the market has suffered a level of uncertainty as a result of a lack of a new town “General Plan”.
The full name in Spanish is the ‘Plan General de Ordenacion Urbana” (more frequently known by the initials “PGOU”) and each urban area in Spain has or should have one. This detailed planning document sets out the precise town planning denomination for each of the many thousand’s of plots of land in the Marbella municipality. In effect, its is a code by which public authorities, private and commercial developers and home owners can establish whether their property is ‘legal’ as being in conformity with the PGOU – the General Plan.
Without delving too deeply into the recent socio-political history of attempts to revise the Marbella General Plan, it suffices to say that there have been various attempts. On each occasion the regional government, primarily the Junta de Andalucia in Seville, the courts and/or central government in Madrid have returned the proposed plan(s) as either incomplete or in some other way defective. As a result, the most recent and valid PGOU General Plan for Marbella dates from the 1986.
If you are considering purchasing a property in Marbella you do need to have a passing understanding of this position as it is a very important consideration when buying.
So what is the result of all this?
As the most recent, and widely accepted as valid, General Plan for the Marbella region dates from 1986, those property developments that conform to the 1986 General Plan are regarded, in very simple terms, as ‘legal’. Accompanying documentation that an estate agent may give you will, hopefully, amount to some early stage Due Diligence to see that you are not wasting time and money with your interest in the target property. Conversely, anything that has not been otherwise ‘legalised’ through the courts, by executive action or with the express approval of the Regional Government in Seville must be viewed as requiring more details of substance to establish its correct legitimacy.
Your Abogado should have local knowledge.
While your estate agent will have a decent level of understanding and expertise, your preferred, chosen and trusted Abogados’ detailed local knowledge will be invaluable. They will assist you in deciding, as an absolute minimum, whether your proposed property purchase in Marbella is of a property that conforms in to the 1986 General Plan.
He or she will, for example, know that the beautiful Casablanca Beach development in San Pedro de Alcantara was built on the site of a proposed old people’s home – as set out in the 1986 General Plan. Additionally, that the Banana Beach development in Midtown Marbella was built on a site scheduled for Marbella‘s central railway station. There are several more notable examples of such planning abuses and local knowledge needs to be relied upon to ensure that you are properly informed and protected about the legal status of your dream home.
As part of the Due Diligence that your Abogado should undertake will be to study the precise planning position of your intended purchase. It is not unusual, especially (but not exclusively) in relation to older properties, for your Abogado to unearth administrative or legal action against a previous owner of the property that has not been complied with. A recent example, that resulted in a buyer abandoning her purchase of the property in question, included a former owner’s refusal to accept that a demolition order may be enforced against the property. She has subsequently purchased a beautiful and fully legalized home in the Marbella region of Elviria.
The need for this level of detail is a fundamentally good reason as to why you should retain a Marbella-based Abogado. An out of town lawyer, or even one who is located outside Spain, may not have the required day to day working and granular knowledge of the intricacies of market that will pay dividends, in the short and long term,. Their conscientious guidance through the myriad of issues that may arise in Marbella is essential.
At a more micro level in some Marbella locations there appears to have been an historically cavalier approach to the necessity of adhering to the PGOU. I have seen several examples of individual villa properties that have been redeveloped over the last thirty years and have been extended significantly beyond their designated and licensed “buildable area” or “density” as detailed in the PGOU. It is understood that the “old guard” in Marbella took the view that if their “over building” was ever discovered by representatives of the Town Hall it was anticipated that a fine would be levied and upon its payment there would be a slip of paper delivered assuring the owner of “legality”. Of course, no such thing should be assumed and quite rightly your Abogado will point out any such flaws in the precise planning position enjoyed by your target property. To be forewarned of such an issue is to be for armed.
As a vitally important aside, the entire Marbella region does not fall under the same PGOU. Benahavis and Estepona, for example, have their own more recent PGOU’s and both are known for a very co-operative and sensitive approach from the respective Town Halls to issues such as planning.
What should be considered when you are looking to buy a property that does not conform with the 1986 General Plan and/or has not been subsequently legalized?
Five simple reasons why you should think carefully about buying such a property:
- If you are buying with a mortgage loan from a Bank their priority will be to ensure that their lending is secure. An ‘illegal” property raises alarm bells and it may well mean that the prospect of borrowing to fund the purchase of such property is limited. Equally, you may see it as comforting that the seller of the property, in turn, had a mortgage from a reputable, even an international bank or savings bank (called a “Caja”) and at some time in the past the lending bank may well have concluded a level of due diligence on the property. Without sight of the bank’s lending rationale this may not be conclusive but it may well be persuasive.
- Buying a legally doubtful property outright with your own resources may mean that you limit the opportunity to resell your property should you decide to upgrade in the future. Any incoming purchaser who has taken the opportunity to question the property’s planning history may well be put off if there are any doubts about its precise position.
- We work with many meticulous clients who arrive with a reasonably fixed mindset that often softens the more they become familiar with the property stock available in Marbella. This doesn’t mean they become lax, far from it, but there may be the need to consider the reality of a particular situation and to evaluate the precise level of risk. This may mean they need to take a calculated commercial decision after receiving exhaustive advice and commentary on the issues in question from their trusted Abogados.
- Should you buy such a property and want to carry out any material renovation works, you may well be required to obtain a “Small Works License” from the Marbella Town Hall. If the property’s legal status is suspect the Town Hall may well refuse to grant you such a license to renovate thus frustrating your plans to get the most out of your purchase.
- In order to secure a Tourism License, that is required by the Spanish state, AirBnB or Booking.com, should you wish to place your purchased property in Marbella up for holiday lets, you may need to show the property’s First Habitation Licence. A First Habitation Licence (also known as a License of First Occupation) may well have not been granted by the Marbella Town Hall if the property does not conform to the 1986 General Plan.
And now for some really good news! While the wheels of government may never turn as quickly as we’d all like, we are very pleased to be able to report that the Marbella Town Hall’s plan to revise and publish a new PGOU are already under way.
From February 2021 a press release from the Planning Department of Marbella Town Hall announced – and I have translated: “On January 31 2021, the deadline for submitting Preliminary Proposals to the new General Plan ended. Currently, the General Plan team is finalizing the study of the suggestions and alternatives presented to the Advance. Once the Scope Document to be issued by the environmental body has been received, the proposal for confirmation or rectification of the criteria and general planning solutions set out in the Progress will be sent to the Plan.”
Reports quoting the Marbella Council Urban Planning delegate, suggest that “We continue working with the scheduled dates.” It is understood that this means that the initial approval of the new PGOU is expected in 2024 and for it to come into force in 2025.
This may seem a while away but there is still much work to do. Watch this space for updates!
My aim here is not to cause undue alarm. The developers/promoters of many recent developments of newly built or recently launched off-plan properties have, of course, had a wary eye to ensure that projects do not contravene the precise planning permission for their plot(s).
If purchasing in such a location you are, of course, well advised to seek your Abogados’ assurances that all will be properly investigated and reported upon. From these findings you will be able to take an informed decision about your proposed purchase. The news is, invariably, positive.
Should you be interested in discussing the process involved in buying a property in the Marbella region, we would be delighted to assist you. As and when you are ready to progress with your search please contact me to discuss your precise requirements.
We are not estate agents, but we work with some hard-working and reputable ones.
We have a multi-disciplinary team of bi-lingual, highly experienced and wholly independent Abogados (Spanish Lawyers) and Asesores Fiscales (Tax Accountants) ready to help you.
Please note that our posts are for general interest. There is no substitute for proper advice tailored to your specific circumstances as provided by a qualified Abogado who is experienced in the application of the Spanish Law. Nothing contained in this article should be seen or taken as the writer or the publisher providing legal, tax or financial advice. All details have been reasonably fact-checked and all efforts have been taken to ensure that facts are accurate as at the date of publication.
My details: Mark FR Wilkins, during usual business hours on +34 600 343 917 or e-mail me at mark@biznagapartners.com
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