Mimosa Beach Gardens

I have some buyers interested in my property but they have been told if they buy it off me after i have taken out a mortgage then the builders 10 year guarantee is no longer valid. Does any body know if this is true?

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Hi Fred not sure the 100% answer  on that but it confounds logic (oh sorry I forgot this is Spain) - have they by any chance been given that info by an estate agent trying to sell them something else (sorry its my suspicious mind again) - ask your own lawyer to clarify the situation and then you can give us all your feedback - in the meantime will check it out myself. If worst comes to worst defer completion and they buy your contract as I assume you do not wish to complete - will be cheaper for you and thus you can make the price more attractive for them.

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Apologies that assumes your contract is transferrable

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thanks smiley i will check with the lawyers and get back to you i have a suspicious mind too !!

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ww

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just heard from lawyers and they have said that contract is not transferrable and that you buy the property not the gardens and swimming pool.And if those and surrounding properties are not complete then that is a matter for the residents and the developer.Would not give answer on builders guarantee.

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Insist on an answer what are you paying them for. Ask them also to explain where in the contract (presumably you have a copy) it states not transferrable - I am not doubting it is not transferrable if they say so but if they tell you the clause you can check and translate so you get the gist. Sorry but you have lost me with what you mean about

"you buy the property not the gardens and swimming pool.And if those and surrounding properties are not complete then that is a matter for the residents and the developer"

What are you asking about and how is it relevant to whether you can sell the contract or not.

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Sorry smiley the swimming pool and gardens are nothing to do with transfer of the contract. I asked the lawyer whether the property is complete and he said apart from swimming pool and gardens .He said in Spain you buy the property and the pool and gardens is a matter between the developer and the residents. Thanks for the info re contract I will get on to them.

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Fred, as Smiley says, if the contract clearly states it is not transferable, then I guess it isn't, but I don't see why selling the property after you have completed would affect the builder's guarantee in any way. As far as I am aware, all new property here, as in UK, is by law guaranteed for 10 years. In practice, of course (this being Spain) you may find it difficult to obtain any written details of this guarantee, and even harder to get the developer to fix any defects which should be covered by it, but that's another story...

As for the garden/pool, I'm confused, like Smiley. Assuming that your contract includes details of the property you are purchasing which mention that there will be communal gardens and a pool, then strictly speaking the property is not complete until these are finished, and the First Occupation Licence should not be issued (this should be issued by the town hall when an inspection by them proves that everything has been completed according to the developer's original project). I also don't understand why your lawyer would tell you that you "buy the property, not the pool". As an owner in a development, you own a percentage of all the communal facilities (this percentage, or cuota, will be included on your deed) I imagine these facilities will be finished sometime, and if someone is willing to buy your property before they're completed then it's not your worry, but I'd want to check it out anyway.

You may be interested in my article A Year In The Life Of The President, Part 3, which should be appearing on EOS soon! We had our own problems on this score.

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Thanks Roberto for the feedback.I will be looking into it and will post any info on this site. I am also in contact with other purchasers who are surprised at what my lawyers have said. I will also be asking my lawyers who they are working for me or the builders!!

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Just reading through this thread from your original post, I see it has got a bit muddled. If you have taken out the mortgage, you must have already completed, in which case the talk about transferring the contract is irrelevant anyway. (Still doesn't make any difference regards the pool etc. Ask your lawyer, if you're not buying the pool, who is? Someone must own it?) However, if you haven't yet completed, but your contract does not allow you to transfer it, you don't have much choice except to complete, then sell. (Still shouldn't make any difference to the guarantee).

I have only recently joined these forums, so I may be covering old ground here, but this raises an important point for anybody else thinking of buying off-plan with a view to selling before completion. Always make sure the contract allows you to transfer to a third party before completion, before entering into any agreement or paying any deposit. Some developers may make a charge for doing this, in which case, make sure you know in advance what this will be, and make sure it's also put down in writing. Recent articles in the press have highlighted the fact that increasing pressure is being put on developers and even notaries to record details of the original purchasers of off-plan properties, so it's getting more and more difficult to make decent profits by selling before completion without declaring the profit and paying the subsequent tax on it. I think this, coupled with the general over supply of new property which developers are finding hard to sell in the first place, means fewer and fewer developers will be willing to allow selling before completion.

There's more on this topic in another thread:  http://www.eyeonspain.com/forums/posts.aspx?thread=331

Hope this is useful (to somebody!) and I'm not just waffling.

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Hi Roberto it is extremely salient and certainly not waffle. Cant remember but put something associated about paying deposits. Hacienda have cottoned on to the fact that if an off plan investor sells on a contract prior to completion there is in fact a liability to 7% Transfer Tax which has not been met. Developers are now running scared that Hacienda will pursue them for the tax which is in fact not their liability (for once I am on the side of the developer - like to give a balanced view). Until now this has not really been policed and hacienda have realised how much tax has been unpaid. It is such an issue at the moment that I have a client waiting to complete whose developer is refusing to sign without provision for this. His original deposit was paid on a CC in his sole name - he came on the original VT on his own and reservation contract was signed only by him. His WIFE was included on the purchase contract from day 1 and to all intents and purposes there has been no transfer but the developer is bricking it - lawyer tells me that there are another 35 to 40 apartments in this situation that he is refusing to sign for until the client pays the "transfer tax" - stubborn sod! Eventually he will sign but he is not alone and there a few in this boat. All of which brings me to the point that I wouldnt mind betting that developers in time all refuse to permit transfer prior to completion.

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Hi, Just heard from my lawyers who say there is no clause in my contract that says I CAN sell the contract.I take it that this means there is no clause in my contract that says I CANT sell it. They also say the 10 year guarantee must be in place before signing at notary and that cedular of habitation often given one year after completion. No reply to my swimming pool question.

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Just heard new from lawyers that in order to be able to transfer the contract there has to be a clause stating that it is transferrable

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Fred, just because your contract does not say you can't transfer it, does not mean you can. You can only do so if the developer agrees - you can't do it without them. Basically, you are asking the developer to cancel your contract and make a new one with a new buyer. Whilst this doesn't sound like a lot of work for them, it's understandable that some developers may wish to charge an administration fee for the extra work involved, and for the reasons that Smiley and I have explained, it's also understandable that many developers don't want to get involved in so-called contract flipping at all any more. For anyone following this thread, the clause you're looking for allowing transfer will be something like this:
El Comprador podra ceder o transferir a favor de terceros los derechos y obligaciones derivados del presente contrato, con la previa autorizacion de la Vendedora.
This basically says the buyer can transfer the rights and obligations of this contract to a third party, with the prior approval of the seller.

Not sure what "cedular of habitation" is (maybe badly translated Spanish by your lawyer?) but presumably he means the First Occupation Licence. It's true that this can take quite a long time to be issued by the relevant authority after the building has been completed, but legally you are not obliged to sign the deed and pay the final installments until it has been issued. In practice many (most?) people do sign without it anyway, but you should at least be aware of the implications. This has been discussed in other threads I believe, also mentioned in Julian's article about his first 3 months as president and my Year in the Life of the President (links to the right of your screen!)

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Fred as Roberto says legally they cannot force you to complete without the habitation licence - read the threads on occupancy licence - if that is what they are referring to tell them you are not prepared to go to completion - unless of course you want to but that would not be my recommendation  

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thanks for the advice smiley and roberto

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Had e-mail from lawyers stating that the habitation certificate often does not come out until a year after the property HAS to be signed for at the notary.

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What do you think of Fred's lawyer, Smiley? (Don't think too hard....)

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We completed April 2005 without the certificate of habitation ! 

Everyone on our MASSIVE urbanisation of EL RASO, outside Guardamar,is in the same position.

Currently the Town Hall of Guardamar is waiting for a large amount of owners to put their property back to the original order before they'll give us our certs. This came about because we, ( hundreds of us with the same style houses) had an uncovered galleria which, now, almost everyone has has covered with conservatory roofing plastic. (We also had grilles.) Town Hall told us we must remove 50% of roof area.
We took our plastic roof off at Christmas hoping inspections would still be 15th Jan but they've now been rescheduled to late Feb in order to give non-resi owners a fighting chance of popping over to remove their roofs themselves or arrange to have their key holders to do it on their behalf. WHAT A MESS THOUGH ! We go over for four nights in March & HAD hoped to replace our roof then, as we've been told we can, ONCE we have this cert in our hands. Looks like NOW we may have to leave replacing it till June. The roof is in our spare bedroom & a tall cabinet we had in the galleria is cluttering up our teensy kitchen.

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