July 17, 2006
Licence of First Occupation, some rules for purchasing off plan
I have been following this really interesting forum about Licences of First Occupation, the thread relates to developer forcing buyers to complete on their properties even though it is unlikely the project will receive its licence. Although there was a lot of negative sentiment I wanted explain that from a developers end, getting a LFO is not always easy even if everything has been done by the book.
Hello all,
Just thought I would add my own experience to the cauldron of advice and contraversy.
I partnered up with the developer of Los Flamencos and we built 94 semidetached villas in Riveirra del Sol.
Now I am probably going to get roasted alive for saying this but we advised people to move in prior to the Licence of first occupation (LFO). We only had one Spanish couple refuse our advice., but they bought the property as a off plan resale a few weeks before the licence was granted.
The reasons as follows:
1. Our development in Rivierra fell under Mijas town halls jurisdiction
2. The townhall was heavilly overloaded with petitions from licences from other newly built urbanisations
3. We were told that it would be between 8 to 10 months for the licence to granted.
4. Some of our clients were residencial and needed to move in right away.
For the record, our licences were in order, we never contravened the permissions we were given and we built a very pretty community that is functioning well and is about 65% occupancy year round. So we knew we would have no problems getting the licence, only that it would be a long wait.
We had 30 or so residents move in between May and July 2005 and about another 15 up until the point where our licence came. Our licence was finally granted in January 2006.
The builders supply was pushed to the absolute limit during that period and we had some fairly big problems with the electric on one of the streets, where the phase kept on blowing every time it rained. It was a real nightmare, especially as my colleague and I would be the ones called to try and sort it out over the weekends.
Nothing we did seemed to hurry the process of getting the LFO. We were in fact stuck until the powers that be decided it was time to send one of their chaps to check. I had never heard of the rule of "Admin.. Silence" during this period either from my colleague or our lawyer though.
Anyway, in this particular example no one got their fingers burnt (apart from me nearly cooking myself one rather wet Saturaday afternoon when the phase had blown again), all contracts were honoured and we now have 94 happy owners.
I think the difference is that the Promoter was Belgian and had a very good reputation back in Brussels, we used a good honest lawyer who we still recommend to our clients (unholy as that sounds, but we do inform all of our clients that impartiality is a good option, however most meet Luis and feel happy to trust him) an excellent builder called BS::::s whom we paid the full tendering price to ensure that there was no further negotiation during the snagging phase during the first year of occupancy.
So that's my 2 cents to this discussion. Buyer beware always, but at the same time the coast is not all full of crooks, and I hope that when the market correction comes the dregs will finally be washed out of the Costa, so that good companies can get back to selling and building house professionally. I think that in the next 5 years Marbella will become one of the most regulated and safest places in Spain to buy a property in light of the clamp down of the Malaya operations.
Category: The Great Housing Debate
Comments
I have to say that whilst you have your own side of the story in terms of the council delaying/assessing your property LFO's; perhaps you might also now see the other side of the fence and how buyers really do suffer without any prospect of utilities.
Having lived close to nine months in 05/06, on a developers inexcusable and shabby supply of electricity, plus a tap in the street for our water, my family and I are pretty much scarred for life over the ordeal. Had we not finally enlisted the british press (aka ITV's help,) our local council/developers would not have been shamed into some appropriate action.
I am still not entirely sure who the real criminals are with regard to this whole sordid business. Is it the local councils inefficient rules and subsequent blind eye to the suffering of those innocent residents duped into buying properties without an LFO? Or is it the unscrupulous developers for not giving a damn and selling their properties without this poxy piece of paper in the first place?
Whichever way, not nearly enough information is available on the LFO, and as a writer I am doing my best effort in bringing it to light. If only for the many future purchasers who will continue to sign the dotted line in ignorance.
Posted by: Mrs Acheson at May 16, 2007 09:05 AM