CHRIS STEWART’S famous memoirs about living on a farm in inland Spain continue to inspire some to follow in his footsteps, but if you’re looking to buy a property in the country, getting good advice helps keep things sweet.
Not everybody wants to live near the beach. We get a steady flow of clients through our doors in search of a remote piece of land or house in the hills, away from it all, where they can live peacefully with nary a worry in the world. But buying country property in Spain can be a risky business if it is not going to be used for agricultural purposes or does not have the required municipal licenses to make building and living in it legal.
We discussed the potential pitfalls with Ignacio Pérez de Vargas, the principal of Pérez de Vargas Abogados, a well-known local law firm with offices in Estepona, Marbella, and Malaga. While the firm handles all kinds of cases, we regularly work with them on sales in the country, as Ignacio and his property team are recognised experts in the field (geddit?).
Ignacio says non-urban land (terreno rustico) is normally used for farming, livestock, or woodland purposes. So if you do want to buy land to build a home, you must submit a development project (proyecto de actuación) that justifies the need to do so to support the activity in question. Projects have to be approved by the regional government’s Environmental Agency before submission to the local town council to obtain a building license.
To make things more complicated, Ignacio explains, there are two different kinds of non-urban land: “Common land, in other words without legal protection, and non-urban land under special protection. On protected land, in general, construction is prohibited. If a property has been built on protected land and there is no municipal building license in place, purchase is not advisable.”
On the other hand, if a property is on common non-urban land, buyers should check it was given a municipal building license, subject to a development project, and a license of initial occupation. If a building license was not granted, ask the seller to obtain a certificate from the town council stating that the statute of limitations on demolition orders – “now six years, up from four,” Ignacio notes – has expired. Buyers should also be aware such properties still contravene town planning and, hence, can only be maintained rather than extended.
Owners of property on non-urban land can also experience difficulties when it comes to contracting utilities and connecting to municipal services, such as sewage systems, that are taken for granted when buying and building on urban land. “Buyers should request to see contracts from utility companies,” Ignacio suggests, “and check services work.”
While the same taxes are charged in Spain for urban and rustic land and property sales, cadastral values of non-urban land tend to be lower, Ignacio adds, meaning transfer tax (Impuesto de Transmisiones Patrimoniales) and municipal capital gains tax (Impuesto Municipal de Plusvalía) are also lower.