VPO Can anyone Advise

I have owned an apartment in Spain for the last 7 years, and paid the full market price for it at the time of purchase from a Spanish vendor.  I had a mortgage with the BBVA  Bank which I repaid 3 years ago. I have only recently requested the Escitura from the bank as I have considered selling the apartment and buying a small Villa,

The agent I went to see, told me the property  I own could be subject to a VPO he went to the land   Registry and                    secured a Nota Simple Informativa for me which seems to confirm this    VP O    I   have never known about this until now, as there is no mention of the VPO on my copy of the Escitura. I have seen a different property’s Escitura and the VPO is mentioned on it however it is not in the same urbanisation but the agent said it should have been on my Escitura as well as the Land Registry document

I have also been informed that as I am not a Spanish resident the bank would not have allowed me to have a mortgage on a property with a VPO on it.

Is it true that what is written on the Escitura is law in Spain, (Like deeds are law in England) or does the Land Registry document override what is written on the Escitura. I have copies of both which I could fax to you if it would be of assistance. I am confused as to how I should proceed to find the truth regarding this matter. Any advice you could give would be much appreciated.

Thankyou

This could be a tricky issue, I really think you need to speak to a lawyer. Who advised you when you bought the property? Probably the banks own legal people - maybe they can offer some advice now? When you say you paid the full market value, you don't say (and it's none of my business) how much you declared on the escritura. If you declared the full value, it could be that the VPO had already been cancelled or expired, but this was never noted at the land registry (which would seem strange, admittedly).

I'm afraid I'm a bit out of my depth here. Maybe Maria (a lawyer member of our forum) can help?

VPO is essentially affordable government housing. I guess the closest parallel you can make to the UK is Housing Association. A VPO order on a property has a pre designated life span - 20 to 25 years. My understanding of it is that a property with a VPO can only be sold or purchased between Spanish residents of a certain income level (however some historically have slipped through the net). As such it is sold at reduced price and also it will have a reduced bank value during the life of the VPO because it cannot be sold on the open market. For example I had a client who decided to buy a VPO property in Fuengirola approx 2 years ago. The VPO had in fact expired but nobody had bothered to register it as such with both the regional government or the Land Registry - this process has taken nearly 20 months. The vendor should in fact not have been able to buy the property in the first place when purchased 10 years ago (as they were non resident) but clearly something happened at the Notary at that time that nobody is aware of now we are in 2007. The purchaser was paying 190,000€ for the apartment but the official assessment for value given was 66,000€. The vendor had to pay a "fine" (administration charge) to have it released from the VPO although the VPO had expired. The 2005/7 vendor had in fact paid cash when they bought the property in 1995 and had not used a lawyer so goodness only knows what was done.

Quite where you stand now only a lawyer can advise as per the previous threads but to be certain BBVA should not have advanced the mortgage on it without ensuring the VPO had been removed both at the Land Registry and the regional Government.

Rgds   

Easy answer to that, Smiley!  I could tell you some stories, from personal experience, but not here. Don't know who might be watching!

According to everything one reads lately, it ain't so easy anymore (and quite rightly, too) Banks especially are getting nervous, and even notaries (previously untouchable, you would have thought) are under close scrutiny. Be warned, all.

VPO needs to be used as first residencies and cannot be higher than 90 m2.

The main concerns on having a VPO property is that there are maximum official prices for the resale and that you need  to communicate the sale to the Administration first as they have legal preferent buying rights.

You can also try to revert the classification of the house as a VPO and sell it in the free market.

In Andalucia, the most recent law om VPO is the Law 13/2005,.Regarding your particular case,  the ommission by developers on the VPO character of houses in the public deeds is fined with 3.000 to 30.000 euros in the administrative realm.

The most offcial information on the classification of houses is what is on the Land Registry. The Notray has an obligation on checking on this before authorising the signing on deeds.

It is actually a fraud and the contract can be considered as null and void.

Anyhow, every case needs to be treated specifically.

Maria, is it possible that the VPO classification in this case had been "reverted" but not recorded at the Land Registry? Motherfirth declared the full sale price when buying at "market price", which seems to suggest that there was never any mention of the official maximum price. Either the VPO has been cancelled but not recorded at Land Registry, or the notary missed it altogether when the sale took place.

When I tried to buy a VPO in Fuengirola a few years back (Myramar - almost all VPO?) the seller wanted 32 million pesetas but "told" me the escritura would only show 16 million ptas! Clearly this could be problematic. Just as a bit of info for anyone following this thread, a VPO building should display a small metal plaque near the entrance declaring itself as such. Look out for it when you're next wandering the streets. You'll be surprised how many times you've passed one without noticing!

YEs, it is possible that the house has been un-classified as VPO and turned int a free market unit and this change hasn´t been recorded by the owner in the Land Registry. You can ask for Nota Simple ( Land Registry Certified INformation) in this site:

www.registradores.org  ( there is an English site in there)

i know this discussion is years old, but it is the most relevant one i have found on this site for my predicament.

i recently got a couple of estate agents to visit my house to give me their opinions, valuations etc, with a view to marketing the property. i gave them all paperwork, such as nota simple and escriturra, then was shocked to discover that my home was still under VPO !!!

when i bought the property through UNICASA, 9 years ago, i was told by my Spanish lawyer that when the property was more than 10 years old (2007), the VPO would no longer apply, and it would assume normal market value for all intents and purposes, with no further action required from me as the owner.

to my dismay, i learned from the visiting estate agents that this was not true, and i would have to go to the Junta de Andalucia in Malaga with all of the house documents to request release from the VPO, but even then, it was a very long process it and not certain to be granted - in fact (although unlikely) it is within the Junta's rights to buy back the property at a figure of their own valuation!

though i did know the property was VPO when i bought, it now appears that i was massively mislead by the parties involved, namely UNICASA, the lawyer, and (most disappointing of all) the lending bank for my mortgage, Banco Halifax (now Lloyds Bank International) - surely they should not even have lent the money, having all of the information to hand, and knowing the possible ramifications.

can anyone tell me if indeed it was legal for the transaction to occur at all ? the house cost me over 250k, but the VPO value at the time was apparrently only 100k...

i'd be really grateful if someone has any advice on where i should go from here to find out where i stand legally, then i can attempt to sort the whole mess out.

fingers crossed...

Donaldo, seems you have repeated your last thread

 Donaldo,

The VPO system is complex and there are several types of VPO with different definitions and conditions so that your particular situation must be reviewed taking into consideration exactly what type of VPO regime you are under.

In general, there is a limitation for selling VPO's is Andalucia for a ten year period from the date in which the VPO system was granted to the property and it is true that you don't have to do anything once the ten year period is over to obtain release from this limitation. However, the condition of VPO persists generally for a period of 20 to 50 years depending on how and how much the construction was subsidized by the Government.  For declassifying the property during that period, you have to apply and meet several requirements.

The issue is complex so it is not a good idea to rely on hearsay or other people's experience or even on what the agents are telling you. It is best to get advise from your lawyer about your speciic cirumstances or get information directly from the relevant authorities.

Dear Donaldo

I am a Gestor Inmobiliario with 20 years experiece . A gestor is similar to a solicitor .  My studies did involve VPO.

My first advice is get a lawyer ( shoulod not cost more than 100 Euros )

By what i recall.....( from 20 years ago,,lae probably hasent changed much ) maximum VPO perios is 20 Years from the original construction date,,,if you sell in that perios you can only sell for a fizxed prearranged price.

If you are thinkin of selling...dowhat the spanish do

I cant put this on a public web...but im sure you know what i mean!!!

I hope this helps

 Yes, a technical revision by an specialist lawyer is the most advisable thing to do in your case Donaldo

http://www.eyeonspain.com/blogs/costaluz/4464/legal-tip-386--disqualification-of-social-housing-vpo.aspx