Offplan property deposits legal successes

The offplan boom that fuelled the Spanish real estate market for nearly a decade may have ended with the arrival of the recession, but the consequences for some unsuspecting buyers lingers on in ongoing disputes.

Currently, savvy buyers are favouring the key ready bargains from hard-pressed developers and Spanish bank repossessions where even bigger discounts are available. Conversely, 100s of buyers from the Offplan Years are still waiting for delivery of their long promised homes or the return of hard earned deposits they handed over in pursuit of their Life in the Sun Dreams.

One of the worst developer offenders was Aifos Promociones, who were recently wound up by the Spanish Courts, and whose directors were jailed for corruption. They seemingly bribed local mayors to get their hands on prime sites in Andalucia, drew up plans for exotic resorts and sold these concepts to unsuspecting buyers, who handed over hefty deposits on the promise a “Manana building licence”.

Agents like specialist PropertyInSpain.Net were recruited to the cause and deposits rolled in from across Europe, enabling the Aifos directors to enjoy a playboy lifestyle and produce a glossy lifestyle magazine to report on their “successes”.

But as few building licences emerged PropertyInSpain.Net because suspicious and asked Spanish lawyer, Javier de Juan to confront Aifos at their Malaga HQ and attempt to obtain licences or regain client deposits. After numerous meetings he was successful in regaining all deposits paid over on disputed developments, despite the fact the developer claimed they were so big they didn’t need to have bank guarantees in place to protect buyers deposits.

Buyers were delighted to get their money back, the website was able to protect its good reputation, but had to forego the retained commissions for the collapsed sales.

Now, in another campaigning website, Eyeonspain.com another couple pursuing the sunshine property dream, detail how they were successful in regaining their “lost deposits” when the legally required bank guarantees were in place. They too put their success down to the efforts of a tenacious Spanish lawyer, in this case, Mario del Castro, daughter of a leading planning legal specialist.

It’s a good example of how to use the cumbersome Spanish legal system to beat developers who think they are above the law and this tale should encourage others. The article also includes warnings on not what to do when buying a property in Spain.

Estate agents lose out to the lettuce sellers

Once there were a lot of them, but now they are closing down their offices on a daily basis all over the Cost del Sol and Costa Blanca, where 80,000 estate agents are thought to have lost their jobs.

For those people who didn’t realise there were so many people selling property in Spain that figure might come as a surprise, but it is just a fraction of the job losses suffered by the guys who have been building the villas and apartments.

Big name agents like Fincas Corral, MC Inmobiliaria, and Don Piso have closed up to 75 percent of their hundreds of branches and the 10 biggest chains in Spain have closed an average of 150 estate agent offices..

No-one will miss them, least of all the Spanish College of Estate Agents, Their president, Santiago Baena, while admitting the closures have been brutal, claims most of them were not proper estate agents anyway. "We always said training was essential but they ask for more training for a man selling lettuce in the market because he has to use a machine."

The construction workers have gone grape picking in France where they, apparently, earn more money (€8.71/£6.95), according to their trade union bosses. Picking lettuce in Almeria doesn’t offer that sort of money, so there is uncertainty for jobless estate agents seeking a new cash crop to harvest.

The mass closure of estate agents' offices may also be a symptom of the way the Spanish real estate industry is changing.

One of Spain’s leading property sales websites is www.propertyinspain.net whose one-stop. select-view-purchase offer once covered all Spain’s second home areas, has also trimmed back on its local affiliate network to concentrate on the best bargain areas. They have retained multi-lingual, well-trained property professionals in key areas to look after their buyers seeking big discounts they first spotted on their website.

Gareth Milton, operations manager of www.propertyshowrooms.com said: "Companies who had always focused on web-based activities without the massive overheads associated with a network of physical branch offices are the ones more likely to weather the storm."