Gecko Towers:
In my last blog concerning the new Rules for Tourist Rental – please see here –
I mentioned the curiously named Spanish “Law of Horizontal Property” (Ley de Propiedad Horizontal, (LHP)). It’s a concept more easily understood if you think in terms of apartment blocks where there are several apartments in a horizontal configuration on the same floor.
There have been a number of enquiries from readers of the MPL blog wanting to understand more about the impact of the LHP and why it is so important in the management of communal living in Spain. So, I felt the time was right to share a little more of what I have learned about the LHP.
Primarily, the LHP is a law that regulates the ownership and management of multi-unit buildings, such as apartments, townhouses and urbanizations in Spain.
Here are some key aspects of the Law:
Definition of Horizontal Property: The law defines horizontal property as a type of property ownership where each owner has a separate title to their property, as well as shared ownership of the common areas.
Common Areas: Common areas include shared spaces such as stairwells, hallways, lobbies, parking spaces, garages, and outdoor spaces like gardens or pools, padel courts.
Owners’ Meeting: The Owners’ Meeting (Junta de Propietarios) is the governing body of the Community, composed of all property owners. The Meeting which has to take place once a year called “the Annual General Meeting” (AGM) but may also take place on agreed dates a Emergency General Meeting (EGM) to discuss a specific agenda and to makes decisions regarding the management and maintenance of the Community.
President and Administrator: The Owners’ Meeting elects a President and an Administrator to manage the day-to-day affairs of the Community.
Budget and Expenses: The law requires the Owners’ Meeting to approve an annual budget, which covers expenses such as maintenance, repairs, and services.
Liability: Property owners are jointly and severally liable for the expenses and debts of the Community, proportionate to their ownership percentage which is described as a “Cuota” or “Quota”.
Dispute Resolution: The law provides a framework for resolving disputes between property owners, the Owners’ Meeting, and the Community’s management.
Amendments and Reforms: The law has undergone several reforms and amendments since its introduction in 1960, with the most recent significant reform being in 2013.
It’s essential for property owners in Spain to understand the Law of Horizontal Property, as it governs the relationships between property owners, the Community’s management, and the common areas.
The Community of Owners (Comunidad de Propietarios) is the collective group of property owners in a multi-unit building in Spain, governed by LHP.
Here’s an overview of their operations:
Decision-Making Process
Owners’ Meeting: The Community of Owners holds an Annual General Meeting (AGM) (Junta General Ordinaria) to discuss and approve important matters, such as the budget, accounts, and major repairs.
Voting System: Decisions are typically made by majority vote, with each owner’s voting power proportional to their ownership percentage (“Cuota or Quota”).
Quorum: A minimum number of owners (usually 50% + 1) must be present or represented to constitute a quorum.
Community Fees
Monthly/Quarterly Fees: Owners pay Community Fees (gastos de comunidad) to cover expenses such as maintenance, repairs, services, and management.
Budget Allocation: The Community Fees are allocated according to the approved budget, which is usually divided into:
Ordinary expenses (e.g., maintenance, services)
Extraordinary expenses (e.g., major repairs, renovations)
Payment Obligations: Owners are obligated to pay their Community Fees on time. Late payments may incur interest and penalties.
Community Management
President: The President (Presidente) is elected by the owners’ meeting to represent the community and make decisions on its behalf.
Administrator: The administrator (administrador) is responsible for the day-to-day management of the community, including tasks such as:
Managing community fees and expenses
Coordinating maintenance and repairs
Communicating with owners and service providers
Management Committee: Some communities may have a Management Committee (comité de gestión) to assist the President and Administrator.
Dispute Resolution
Internal Disputes: Disputes between owners or between owners and the community can be resolved through mediation or arbitration.
External Disputes: Disputes with external parties, such as service providers or authorities, may require legal action.
Records and Documentation
Community Register: The community maintains a register (registro de la comunidad) of owners, their contact information, and other relevant details.
Meeting Minutes: Minutes of owners’ meetings and other important decisions are recorded and stored.
Accounting Records: The community’s financial records, including budgets, invoices, and payment receipts, are maintained and audited regularly.
Obligations and Responsibilities
Owner Obligations: Owners are responsible for:
Paying community fees on time
Maintaining their property and the common areas
Complying with the Community’s rules and regulations
Community Obligations: The Community is responsible for:
Maintaining common areas and services
Managing Community Fees and expenses
Ensuring compliance with laws and regulations
This overview should provide a comprehensive understanding of the Community of Owners and their operations in Spain. If you have specific questions or need further clarification, feel free to ask!
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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 legal, tax or financial advice and cannot be relied upon as such. Neither the writer nor the publisher accepts any responsibility for liabilities arising as a result of reliance upon the information given. 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.
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