For many investing in Spanish real estate, the urge to build your home from scratch or pick a property in need of TLC is all too great a challenge to resist. But developing properties on non-urban land, that is to say land that is neither urban nor authorised for development by the local authorities, could leave you open to so-called 'land-grabs'.
The issue of planning permission, or lack thereof, for properties on non-urban land has been a big problem for Spain's regional governments. So much so, that their only redress has been to demolish illegal developments where they find them and reclaim the land for themselves. Needless to say, these 'land-grabs' have not gone down well with homeowners.
Fortunately, recent land law reforms in the regions of Valencia and Andalucía are cutting the red tape surrounding planning permission; meaning 'land-grabs' could well be a thing of the past. Here we bring you up to speed...
Valencia
Recently approved land reforms in Valencia aim to harmonise existing planning laws and give homeowners a greater incentive to make their developments lawful. Under the new law called LOTUP, local authorities have 15 years to review the planning status of any property built on non-urban land.
Prior to LOTUP, homeowners building on non-urban land had four years from the date of their building works to obtained planning permission in order to avoid hefty fines or possible 'land-grabs'. Any development outside this period, although escaping the wrath of the local authority, would still be deemed an illegal development - a bittersweet victory that would ensure negative repercussions on the property's future sale price.
Some might perceive the longer 15-year timeframe for inspection as a cause for concern, but LOTUP makes a compromise by simplifying the process for retrospective planning permission to be granted.
So, if your property has been built on non-urban land, but there are at least three other similar properties within a one hectare (or 10,000 m2) radius of you, planning permission will not be denied. Previously, the criterion for permission to be granted was based on there being at least 10 similar properties within a 100m2 radius of your development.
Andalucía
Similarly, the autonomous region of Andalucía has also made moves to assist homeowners with planning laws. Recent amendments to an existing land law referred to as LOUA may well result in as many as 25,000 homes, which have been unlawfully built on the region's non-urban land, obtaining retrospective planning permission.
Previously, LOUA gave the local authority six years to review the status of a property's planning permission. Once six years had passed from the date of construction, it was possible for homeowners to avoid forced demolition and 'land-grabbing' from the authorities, but an illegal development would forever remain just that. Again, this would impact negatively on the value of your property.
While the protection afforded to homeowners by the six-year restriction still applies, a recent amendment to LOUA gives homeowners with older developments the opportunity to right the wrongs of overlooked planning consents, so that illegal builds can be legalised without any time limit whatsoever.
However, homeowners should note that if they have built their properties on non-urban land in a place of environmental interest, or on a flood plain, their development will not be granted planning permission, retrospective or otherwise, on grounds of conservation and flood risk, respectively.
Next steps
So what should you do if you are unsure your property has been built on non-urban or urban land? Examining your property deeds may give you some insight, but to be certain you will need to ask the local authority where you stand. If you suspect that your property may fall foul of planning laws, or are not sure how to approach your local authority for further information, then seek independent Spanish property advice.
Essentially you will need to apply for retrospective planning permission and complete the necessary works, if any. This will not only give you peace of mind knowing your home is safe from being demolished and that your land will not be retained by the local authorities, but will also ensure the value of your asset is not put into jeopardy.
If Valencia and Andalucía's recent land reforms have taught us anything it's that 'land-grabs' are no longer an inevitability but moreover a consequence of inaction. By taking responsibility now for obtaining the right planning consents you'll ensure that the only challenge you'll face with your home improvements is what colour to paint the walls.
Jon Eshkeri (E&G Solicitors)
(This article was first published in A Place in the Sun Magazine Winter 2014 issue 120)
