Andalucia Decree 218 and what it means to you as a buyer.
It has been over a decade since the Andalucia Regional Government introduced Decree 218 in order to protect buyers of properties in Andalucia.
If you are buying property in Spain, it is important to understand that this regulation only applies in Andalucia, and not to the rest of Spain. As a Federal country, Spain allows Autonomous Regions to enact local laws that only apply to their regions. If you are buying property in other Autonomous Regions of Spain, check with your local specialist about their equivalent laws (if any).
Why Decree 218 was enacted?
You may have heard a lot of negative stories about people in the 1990s who purchased illegal properties, which they were then not able to resell or reform, because they were built without proper and formal permission from their Town Hall.
Decree 218 was introduced in 2005 in order to formalise the documentation needed to ensure buyers do not get trapped in these kinds of situations.
What does Decree 218 require?
Decree 218 requires sellers to provide full disclosure, including documentation to prove their property is legal and complies to all building regulations. The information must be provided to all Agent they employ to sell their property.
Documents include:
First occupancy licence
This is issued once the build is completed and certifies that the property was built according to the planning permissions granted by the Town Hall, and other regulations in force at the time of the build. For new properties, full disclosure of plans, number of units, estimated completion date, etc. must be declared.
Nota Simple
This is a document that shows ownership and any mortgagees associated with the property. This is not the same as the deeds, but is a summary of the deed (hence Simple), which states the owners, Catastro Reference number (land registry number), location, size of the property, any mortgages, etc. on the property.
Energy Certificate
This is a certificate that shows the energy efficiency of the property so that the buyer is fully aware of the potential energy costs of the property.
IBI Costs & Payment
IBI is the property tax paid to the local Town Hall for services every year, and proof of payment for the current year.
Basura Costs & Payment
Rubbish collection charges by the Town Hall and proof of payment for the current year.
Community Fees
Cost of community fees including any surcharges.
Who is responsible to provide the information?
Significantly, Decree 218 makes the Estate Agents (Real Estate) companies offering the property for sale responsible for obtaining, holding, and making it available to potential buyers. There are heavy fines for failing to have and provide this information including fines of up to 30,000€ per property!
This means Agents must obtain full information from the owner before listing the property for sale in their office, on their website, or other 3rd party portals. Failure to do so could result in fines.
When can a buyer ask for this information?
Buyers are entitled to ask for this information from the selling agent before, during, or after they view the property. Buyers do not have to make an offer, or show an interest in making an offer, in order to have the right to examine these documents.
However, note that Andalucia’s Decree 218 does not apply to private purchases, so if you buy a property directly via advertising by the owner, Decree 218 does not apply, and you have no recourse under this regulation.
Summary
Decree 218 was introduced in order to protect buyers from mis-selling and financial ruin that buying illegal properties can cause.
Our advice is not to view any property unless the agent can confirm full Decree 218 compliance, and never make an offer until you have seen, examined, and understood the information contained within the Decree 218 pack.
If you do not speak Spanish, ask your lawyer or your Property Finder to translate it for you, or give you their synopsis. They usually can tell the tell-tale signs of when you should walk away.
If you are tempted to buy a property advertised directly by the owner, at least ask for the same documents. Beware, when buying directly advertised properties, you have no legal rights to see these documents until you make an offer and before you agree a Private Contract. Additionally, if the documents are falsified, are incomplete, or are invalid; you have no automatic legal recourse, other than to pursue the seller through costly and lengthy Spanish civil courts.
If you need further help, contact us before buying a property, and we will be happy to help.