When buying property in Spain many people feel the statement bank guarantee means you have a degree of security (when buying off plan).
Bank guarantees, unfortunately are not and have never been worth the paper they are written on. Generally they are placed for the peace of mind for the client, however I have never known a bank to actually pay out on one as they usually find a way to wriggle out of this. A better system would be to put stage payments in escrow whereupon the authority to draw down on funds against construction can only be authorised at specific build stages to be confirmed by the architect, and if all is well then the lawyer (or client) can release neccessary funds. www.spcinvest.com
Thursday, June 26, 2008
English construction company leads the campaign for sweeping reform in the Spanish property market
For a number of years Spain has been popular with overseas property buyers. Recently many issues have currently come to light, which has had a serious impact on those wishing to invest in Spain. Outside of the current economic climate, Spain has created many of its own problems, by its own greed in the construction and banking industries.
With some larger estate agents taking commissions of up to 20%, lawyers who are unnaccountable for the sale of property without all permissions, banks that have a valuation policy based (previously) on what the constructor required and a surplus of decidedly average apartment blocks, that the maketplace did not need or desire - all add up to the current situation.
Spanish property company has actively campaigned for changes to the current system, to give protection to those who invest in Spain. Recently a press release has been sent to the current Spanish minister of housing - Beatriz Corredor Sierra.
This promotes sweeping reforms to the whole industry including construction, real estate / estate agents, lawyers and banking. If you wish to view the letter (english translation) view at http://spc.realtors.officelive.com/media.aspx
With some larger estate agents taking commissions of up to 20%, lawyers who are unnaccountable for the sale of property without all permissions, banks that have a valuation policy based (previously) on what the constructor required and a surplus of decidedly average apartment blocks, that the maketplace did not need or desire - all add up to the current situation.
Spanish property company has actively campaigned for changes to the current system, to give protection to those who invest in Spain. Recently a press release has been sent to the current Spanish minister of housing - Beatriz Corredor Sierra.
This promotes sweeping reforms to the whole industry including construction, real estate / estate agents, lawyers and banking. If you wish to view the letter (english translation) view at http://spc.realtors.officelive.com/media.aspx
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