• Financial crash fallout still being felt, leading to opportunities for buyers
• CostaLuz Lawyers negotiating unique solutions between sellers, banks and buyers
• Spanish house prices still 32% (inflation-adjusted) below peak (Global Property Guide)

Despite it being now nearly 15 years since the global financial crisis, the fallout is still being felt in the Spanish property market. Property law specialists CostaLuz Lawyers report that many homeowners continue to pay eye-watering mortgage payments for properties that have devalued by as much as 40%.

Figures from the Global Property Guide’s January 2021 update on Spain show that nationally the country’s house prices are around 23% below peak levels – or 32% below when adjusted for inflation. In coastal areas where prices soared in the boom years, this figure can be much higher. 

“We’re working with a number of property owners who are in negative equity and looking for a quick exit from their property ownership. Rather than getting to the point of repossession by the bank – which neither the owner nor the bank wants – we are acting to find buyers to step in and purchase the property. With the right legal arguments, we’ve found that many banks are willing to accept a buyer at prices below market value in order to progress a sale and avoid repossession.”

Keith Rule, www.costaluzlawyers.com

For buyers these days, prices and interest rates are a totally different story than they were during the boom years. Those seeking second homes, or even primary residences, in popular tourist areas have some superb deals available when they buy using the CostaLuz Lawyers service.

For sellers and banks, the service usually provides the only solution other than repossession. With property values below the level of the outstanding mortgage debt, sale on the open market is not a realistic option. However, an easy sale, presented by legal property experts making just the right arguments, can work for all concerned.

“We’ve been negotiating these kinds of deals between sellers, banks and buyers since 2012. With nearly a decade of experience in this area, we are well placed to help buyers achieve the prices they need. This frees sellers from their negative equity position and saves banks the time and expense of repossessing and then selling the properties themselves. We would certainly encourage any buyer looking for particularly good value to consider this route into Spanish property ownership.”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• Rural hamlets and unfinished developments provide plenty of choice for buyers looking for a project
• CostaLuz Lawyers warns of the importance of checking legal and practical details before committing to buy
• Planning permission, licences and zoning all need careful attention

The Covid-19 pandemic has made many city dwellers reassess their relationship with all things urban. In June and July 2020, buyer inquiries to Rightmove from those living in cities shot up by 78% compared to the previous year. The number of people considering properties in village locations, meanwhile, was up 126%.

It’s not just villages in the UK that are attractive to buyers looking to escape city life right now. According to the property experts at CostaLuz Lawyers, Spain has much to offer when it comes to escaping the pandemic, particularly for those looking to detach from urban life in a more substantial way.

“Spain is home to around 1,500 abandoned hamlets due to significant rural depopulation over the past couple of decades. These offer a fascinating opportunity for property buyers who want to opt out of city life and reconnect with the land. And with so many hamlets available, the prices can be really quite attractive.”

Keith Rule, www.costaluzlawyers.com

Rural depopulation is a big issue in Spain, where over half the country has a population density of under 12.5 inhabitants per square kilometre. Prime Minister Pedro Sanchez reports that, “Half of Spain’s municipalities have fewer than 1,000 inhabitants, and a large part of our territory is at risk of depopulation.” As such, abandoned hamlets – of ‘ghost towns’ can be found dotted across the country.

But buying your own Spanish ghost town isn’t just about ancient farmhouses that are slowly crumbling in idyllic rural locations. When the global financial crisis hit, a swathe of developers across Spain went bust, leaving housing projects of all shapes and sizes unfinished. Some have little more than foundations in place, but others are almost finished. Most are now owned by the banks that took them on from bankrupt developers. As the sites are too expensive to demolish, most are just sitting unfinished, with nothing having happened since workers downed tools when the financial crisis began to bite.

“There are various options available if you want to purchase multiple properties in Spain at a majorly discounted price. In most cases, you’ll be taking on a project rather than a completed set of dwellings, but for buyers who are looking for something unusual some of the opportunities are really interesting.”

Keith Rule, www.costaluzlawyers.com

The CostaLuz Lawyers team warns, though, that it’s important to examine both the legalities and the practicalities of your purchase before committing to anything. First and foremost, there are matters around planning permission, licencing and zoning to consider. Many rural properties, for example, may have been built without the correct permissions in place. This means you might be ordered to tear them down. Others will have restrictions in place on the scale of renovations that you’re allowed to undertake due to protections on the character or nature of the dwellings.

Zoning has its own quirks. You might have a country spa or a glamping business in mind, but if the land is zoned for rural use then you might find yourself needing to run a farm instead. Even residential use might be out of the question without keeping a few sheep or growing a couple of crops on your land.

In terms of practicalities, the CostaLuz Lawyers team warns buyers never to make assumptions. It’s all too easy to take utilities – water, energy, broadband – for granted, but some abandoned hamlets don’t provide access to all of these. Some don’t even come with the potential for such connections.

There are other risks too, so it’s essential to look at the property transaction from all angles. Getting seven or eight houses and various outbuildings for under €100,000 may seem attractive initially, but if the legal and practical details don’t stack up, the potential can quickly unravel.

“The final element to consider is your exit strategy. Owning a village that’s a major project might be your dream right now, but what happens if you need to sell it suddenly or unexpectedly? With an estimated 3.4 million unoccupied properties in Spain, it could take years to find another buyer. It really is essential to check every aspect of such a purchase before committing. That said, if you find the right property and enjoy a challenge, buying a Spanish ghost town might just be the ideal social distancing project.”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• British appetite for holidays and second homes in Spain remains strong
• CostaLuz Lawyers walks buyers through safe online buying practices
• Pre-foreclosure purchases deliver savings of up to 60%

The Covid-19 pandemic has done little to quell the long-term British love for Spain. In fact, the idea of lounging on a beach in the sunshine holds a great deal more appeal when it is so far out of reach. As Spanish tourism board officer in London, Javier Piñanes, recently pointed out:

“There is a strong desire to travel on the part of the British and they emphasize that Spain is the destination they want to travel to, it is their top destination for holiday.”

Nor is it just holidays that Brits are dreaming of during lockdown. Recently reported figures from Taylor Wimpey España observed an increase of 39% in website traffic during the first week of 2021, compared to the same week a year earlier.

But with travel restrictions in place that, currently, have no end in sight, how can British buyers turn their dream of holiday home ownership into reality?

According to CostaLuz Lawyers, with the right safeguards in place, it is perfectly possible to buy a Spanish property safely online during the lockdown. While buyers can’t visit the property and the local area in person, they can research to their hearts’ content online. Key to doing so safely is to engage an independent lawyer early in the process.  

 “The right lawyer can be invaluable in terms of helping you choose a Spanish property. They can help you to work with reputable, honest and reasonably priced agents, arrange a surveyor, check all required paperwork is in place and do the conveyancing and post-sale work. Not only that, but your transaction will be covered by the law firm’s professional indemnity insurance and title insurance, for added peace of mind.”

Keith Rule, www.costaluzlawyers.com

Locating the right agent through whom to buy is half of the battle. Plenty of British buyers have been burned attempting to buy property in Spain before now. The CostaLuz Lawyers team can attest to this. They have won almost 850 claims from Spanish property developers and banks, with many cases brought by buyers who paid substantial deposits during the pre-crash years, but never received a completed property. Many of these cases are still working their way through the courts now, some 10 to 15 years after the deposits were lost – in 2020, CostaLuz Lawyers won 51 cases for a total of 76 clients, despite the shutdown and reduced operation of the Spanish legal system for extended periods during the year.

These cases highlight how essential it is to find the right agent, which is something that an independent property lawyer can assist with. Not only that, but the right legal representation can also open doors to potential cost savings. CostaLuz Lawyers, for example, operates a service that connects British owners of negative equity homes in Spain – those who are facing foreclosure in the near future – with buyers in the UK. The service enables the seller and buyer to agree a below market value price that avoids foreclosure, keeping everyone happy (including the bank). In some cases, this service has seen buyers pick up homes for around 60% of the price paid for them back in 2007.

“Buying during the pandemic means finding new ways to view properties and engage with the purchase process. It can also deliver some excellent bargains. And what better way to finally celebrate the lifting of travel restrictions, whenever that may be, than to visit your new holiday home?”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• CostaLuz Lawyers highlights potential to take action against banks
• ‘Illegal’ property owners can claim for refund of off-plan deposit
• Claims not subject to December 2020 deadline that applied to many other owners

The Spanish property experts at CostaLuz Lawyers have reached out to owners of ‘illegal’ properties in Spain to reassure them that all is not lost. The team has highlighted the potential for owners of these properties to make a claim against their developer’s bank for a refund of their off-plan deposit. Not only that, but if the buyer subrogated the developer’s mortgage, they can also claim for all mortgage repayments.

Action can be taken against liable banks under Law 57/1968, with no deadline in place for making such claims, yet few of those impacted are aware of the full extent of their right to a refund.

An illegal Spanish property is one that did not have the proper planning permission, building licences or other paperwork in place at the time the client paid their off-plan deposit. Many buyers moved into such properties following the building boom of the early to mid-2000s, either paying for them in full or taking on large mortgages. These buyers now have recourse to legal action to reclaim the deposits that they paid – along with interest and legal fees.

“We’ve been hugely successful in winning back some €25 million for Spanish property buyers who lost deposits to developers who went bust. The deadline for such claims under Law 57/1968 was 28 December 2020. However, claims for the return of off-plan deposits paid on illegal properties, and for mortgage payments where the buyer subrogated the developer’s mortgage, are not subject to this deadline; they’re not subject to any deadline at all.”

Keith Rule, www.costaluzlawyers.com

Owners can claim against the developer’s bank or insurer for a refund of any deposit that they paid prior to the legally required paperwork being in place. This applies even when no contract exists, as the Spanish Supreme Court has deemed that lack of consent means no time-barring can be applied.

Despite many of those who are eligible to claim having purchased their properties 15+ years ago, it was 2013 before the Supreme Court stated that ‘finishing’ a property means not just building it but also having all of the legal paperwork in place. And it wasn’t until 2016 that the court clarified that planning illegalities were a matter that fell under the purview of Law 57/68.

“There is clear case law to support the claiming of refunds of deposits paid on illegal properties and in some instances of mortgage repayments as well. The Spanish justice system can move slowly but this doesn’t mean that it is not worth pursuing a case. The return of a deposit, along with 15+ years’ worth of interest, can equate to a lump sum that feels well worth the wait.”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• Brits who missed TIE residency document application deadline can still apply
• CostaLuz Lawyers highlights positive implications of the decision
• Those with family links in Spain may also be able to apply for residency

Brexit may be well and truly done, but British citizens residing in Spain who have yet to complete the necessary paperwork have just been thrown a lifeline by the Spanish authorities. The government has announced that those who can prove they lived in Spain prior to 31 December 2020 may still apply for residency there.

Immigration officials have been instructed to follow the same procedure as they did for those applying for residency before the December deadline, though with particular attention paid to documentation that proves the individuals’ residency pre-dated the end of 2020.

Keith Rule of pioneering law firm CostaLuz Lawyers comments:

“This is excellent news for UK citizens who, for whatever reason, have yet to make their residency in Spain official. They can now apply for the TIE residency document without fear of reprisals or penalties for having missed the 31 December 2020 deadline. The move is a key signal of the value that Spain places on its long-standing relationship with the UK and a positive indicator for post-Brexit relations.”

The Spanish guidance states that British citizens arriving in Spain as of 1 January 2021 can also apply for residency in certain situations, such as if they have a family link with a beneficiary of the Withdrawal Agreement.

“All of this spells good news for a close relationship between Spain and the UK over the coming years,” continues CostaLuz Lawyers’ Keith Rule. “There are hundreds of thousands of British expats living in Spain, while some 18 million Brits spend their holidays here each year. Making it easier for residents to obtain the TIE, despite missing the deadline, should be well received by both expats here in Spain and policymakers back home in the UK.”

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• Property law firm shares expert advice as deadline looms
• Many British property owners seeking clarification on Brexit’s likely impact
• Just days left for Britons in Spain to apply for residency

There’s been plenty of talk about how Brexit will impact Britons’ ability to go on holiday within the EU from 1 January 2021 onwards but what about those who own property there? Brexit tasks are, of course, ongoing, but in response to a wide range of queries from anxious British owners of property in Spain, the experts at CostaLuz Lawyers have shared their insights into what Brexit will and won’t affect, based on what we know so far.

“We’ve been responding to plenty of queries about residency over the course of this year but also about property ownership in Spain and how that is affected. As the Brexit deadline looms, many property owners’ concerns are increasing, so we wanted to share some detail about what the future holds in order to allay property owners’ concerns – and those of anyone looking to buy property in Spain in 2021 as well.”

Keith Rule, www.costaluzlawyers.com

Will the property purchase process change as a result of Brexit?

No. Britons who buy property in Spain will still have to follow the same purchase process.

I own property in Spain – will Brexit affect my rights as a homeowner?

No, it won’t.  Property rights are never linked to residency status.  All owners of property in Spain have the same rights and obligations, regardless of where they are from.

Are there any tax implications?

There aren’t any tax implications in relation to property ownership. However, the rate of non-resident income tax that British nationals have to pay will increase from 19% to 24% from 1 January 2021. This is because Spain, along with other EU countries, distinguishes between EEA and non-EEA nationals.

How long can I stay in my Spanish property after Brexit?

From 1 January 2021, rules regarding the length of your stay in Spain will change. You will no longer be allowed to stay for more than 90 days at a time in a 180-day period.

Note that the 90 days starts as soon as you enter the Schengen Area. This means that if you travel to Spain via France, for example, the time you spend in France counts towards your tally of 90 days.

What if I want to stay for longer – can I join two periods of 90 days?

No. At present you can only spend up to 90 days in Spain, then you must leave the country. You will then not be able to return to the Schengen Area until 180 days have passed since your date of entry into Spain (or elsewhere in the Schengen Area).

You can, however, divide the 90-day period into smaller chunks, for example by spending two periods of 45 days each in Spain.

Does the 90-day rule apply even if I own property in Spain?

Yes, it does. Spain may, of course, introduce new legislation to favour British property owners and allow them to spend longer periods of time in the country. However, at present the government has not announced any new rules.

Will Brexit affect my rights as a homeowner in Spain?

No. The UK’s decision to leave the EU does not affect homeownership rights in Spain. These will continue to be the same as they were prior to Brexit.

Will my NIE change when the UK leaves the EU?

No. Your NIE (foreigner’s identification number) is valid throughout your lifetime and does not change.

What if I am officially resident?

If you have a Spanish residence permit (known as the Tarjeta de Identidad Extranjero/TIE), your status falls under the Withdrawal Agreement set up between the UK and EU. This means your rights in Spain and the rest of the EU do not change after Brexit.

What if I live in Spain but am not officially resident?

In this case, you need to act fast. Very fast. You have until 31 December 2020 to apply for residency. If you don’t, you won’t enjoy the same benefits as other EU citizens in Spain.

Note that, on 4 July 2020, the Spanish authorities introduced a new residency card for British nationals in Spain. Known as the TIE (tarjeta de identidad de extranjero), the card expressly states that the holder is a beneficiary of the Withdrawal Agreement between the UK and the EU. It also confirms the holder’s right to live in Spain.

“There is bound to be a period of adjustment following 1 January 2021 for Britons who own property in Spain, particularly for those impacted by the 90-day rule. It’s important for property owners to stay abreast of any further developments over the course of 2021 (and beyond) to ensure that they are fully aware of their rights and obligations.”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• 500 cases now won using 50-year-old Spanish law
• Cases for 71 clients won in 2020 despite COVID-19 disruption to courts
• Decade-long cases see some clients spending entire retirement years fighting for justice

Spanish property law firm CostaLuz Lawyers has announced the recovery of €25 million for clients who paid deposits on homes that were never built (or finished) due to the global financial crisis back in 2007/08.

With another 200 cases in progress, the company expects that figure to rise significantly over the months and years ahead, despite the fact that 28 December 2020 marks the final date for buyers in this position to start legal proceedings.

“Since our first landmark victory using Law 57/1968 back in 2012, when we won €1.5 million plus costs and fees, we’ve won around 500 cases for clients who thought their deposits were gone forever. With some cases taking as long as a decade, this really highlights the value of persistence when it comes to navigating the Spanish legal system.”

Keith Rule, www.costaluzlawyers.com

47 of those wins, representing a total of 71 clients, have been won in 2020. That means the CostaLuz Lawyers team has won approximately €3.5 million this year alone, despite courts closing and other significant disruption due to the COVID-19 pandemic.

With cases taking as long as a decade to work their way through the courts, some of the clients that CostaLuz Lawyers is winning money back for are now in their 80s. Many were on the verge of retirement when they originally put deposits down on their dream Spanish homes back in the boom years of 2004 to 2008. They’ve since spent years of their retirement fighting for justice.

Other of CostaLuz Lawyers’ clients are just approaching retirement now – a prospect made vastly more appealing by wins representing tens of thousands of pounds. Chris Nairn, for example, was 50 when he first paid a deposit of around €125,000 for a property in Murcia. When the developer didn’t deliver on time, Chris asked for his deposit back. He finally got it back – plus interest and fees – a full decade later, thanks to the CostaLuz Lawyers team.

“When I first bought, putting down a 30% deposit, it was a dream come true, but the property was not completed on time and the nightmare began. CostaLuz Lawyers warned me the road ahead would be long and tough and that Spanish Law is complex and not easy to navigate. It took 10 years, with a lot of ups and downs, but I remembered what they said and held firm. Finally, we got our money back with interest.”

Chris Nairn, client of www.costaluzlawyers.com

The majority of those who have won their money back had put deposits down on properties on the Costa del Sol and Costa Blanca. However, CostaLuz Lawyers has also successfully represented clients in relation to off-plan properties on the Costa del Azahar, Costa Brava and inland. Most hail from the UK and Ireland originally, along with a number of Spanish nationals and residents from elsewhere in Europe.

“There is just a handful of days left for buyers who lost deposits to initiate legal proceedings. It can be a long, arduous process to obtain a refund, but with so much at stake, it’s a process that’s worth persevering with. The sums of money in question, particularly once interest and fees are factored in, can make a huge difference to the course of people’s retirement years.”

Keith Rule, www.costaluzlawyers.com

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• 28 December deadline looms for buyers who lost deposits to make claims
• Opportunity applies to off-plan property buyers whose homes were never completed
• CostaLuz Lawyers urging buyers who lost out to take action before it’s too late

There is just one month left for those who lost deposits on Spanish off-plan properties that were never completed to begin legal proceedings to try and get their money back. After 28 December 2020, these buyers will no longer have the option to take legal action against the banks and developers who took their money but never delivered the promised homes. As such, the team at CostaLuz Lawyers is urging any buyer who has not yet taken action to do so without delay.

The financial crisis hit Spain’s property market hard, causing a string of developers to go bust. Buyers from around the world – and in particular from the UK, due to the country’s long-standing love of Spain – suddenly found themselves without the properties they had been promised and without any means of claiming back their deposits.

CostaLuz Lawyers and Keith Rule changed all that in 2012, when they used a 45-year-old law to win a class action for off-plan deposits of almost €1.5 million plus interest and costs. It meant that those who lost their deposits now had recourse to take legal action against the banks who took their funds, as well as the developers.

The CostaLuz Lawyers team, with Keith now onboard, has won 450 such off-plan cases, including 110 in 2019 and 70 in 2020 despite the pandemic closing down much of the judicial system in Spain. Altogether, the CostaLuz Laywers team has won around €22 million for clients who lost off-plan deposits, but time is running out for those who have yet to start legal proceedings.

“In many cases, buyers are nervous about ‘throwing good money after bad,’ but we’ve proven time and again that legal action is the only way to win back not just the buyer’s original deposit, but costs and interest as well. Any buyers who don’t take action at this stage are effectively saying goodbye to tens of thousands of pounds – and sometimes more – forever.”

Keith Rule, CostaLuz Lawyers

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• Global financial crisis saw 36% fall in Spanish house prices (INE)
• Prices now falling again, with 3.1% drop between March and September (Tinsa)
• CostaLuz Lawyers facilitating below market value sales of distressed holiday homes before repossession

As Spain battles to cope with the economic impact of COVID-19, figures from Tinsa show that house prices have fallen by 3.1% since March – and by 7.6% in the Balearic and Canary Islands. It means that the country recorded its first year-on-year price drop for four years in September, with an average fall in value of 0.6%.

Yet for some of those who own property in Spain, this is just the latest instalment in a negative equity story that stretches back well over a decade. According to CostaLuz Lawyers, many families who bought holiday homes in Spain back at the peak of the bubble that burst so spectacularly back in the mid-2000s are still trapped in huge negative equity situations.

“Spanish house prices fell by 36.3% from 2007 to 2015 and many buyers are still trapped owning properties that are worth significantly less than they paid 14 or 15 years ago. With the economic situations in the UK and Spain both deteriorating as a result of the pandemic, and house prices in Spain starting to fall once more, many banks are open to taking back properties in lieu of the pending mortgage debt.”

Keith Rule, CostaLuz Lawyers

Foreclosures in Spain were already on the increase before anyone had even heard the term “COVID-19.” According to the National Statistics Institute (INE), foreclosures in the first three quarters of 2019 were 11% up on the same period a year earlier. For new dwellings, that figure shot up to 36.9%.

Spanish banks are often keen to close such deals by the end of December, to tie in with the end of the financial year. This means that many British owners of negative equity homes in Spain will be feeling the pressure to give the keys back to the bank, particularly in light of prices now starting to fall once again. Yet these property owners are not without options.

“Homeowners facing this scenario often refer to themselves as ‘mortgage prisoners’ and believe there’s no way out of their predicament but that’s not necessarily the case. We offer two services that mean those trapped in negative equity can finally escape the situation.”

Keith Rule, CostaLuz Lawyers

CostaLuz Lawyers has a service that enables homeowners to offer their properties back to the bank in lieu of their outstanding mortgage debt, negotiating the property’s handover even when the amount of the debt is significantly higher than the value of the home.

However, the company doesn’t stop there. It also serves to pair those wanting a way out of negative equity with those looking to purchase a below market value property in Spain.

“Most services of this nature take the repossessed property after it has been returned to the bank, add on a percentage and then sell it. We take a different path. We negotiate the sale before the repossession, using legal arguments to show how this is favourable to both the bank and the owner. It’s also highly advantageous to the new buyer, who can usually pick up a property for around 60% of the price paid back in 2007.”

Keith Rule, CostaLuz Lawyers

There is no time limit on the sale of these distressed properties, meaning that both seller and buyer can work together to find a solution that suits all parties, with CostaLuz Lawyers coordinating the legal side of the process.

CostaLuz Lawyers is already renowned for helping over 1,500 clients from across the UK and Ireland claim back deposits previously considered lost on properties that were never finished or built following the financial crisis. Now, their distressed property service is helping another swathe of property buyers who were caught out by the crisis.

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es

• New hope for clients who lost money to developers posing as estate agents
• Buyers have until 28 December to start legal proceedings
• 100s of buyers in UK and Ireland could regain lost deposits

CostaLuz Lawyers has spent years helping clients who lost deposits on Spanish properties that were never built or never finished, winning nearly 850 cases against property developers and banks. Now, the firm is providing fresh hope for buyers who have previously been unable to take action to regain their lost deposits.

The new hope centres around growing case law in Spain in relation to ‘hidden’ developers. These are companies that operated as estate agents but were actually developers or co-developers, such as Ocean View Properties on the Costa Blanca and Palmera Properties on the Costa del Sol.

In these cases, this dual role of agent/developer was often hidden from the buyer. However, CostaLuz Lawyers advises that there is growing evidence that its existence opens up the possibility of the buyer claiming against such companies for a refund.

“These companies received huge amounts of off-plan payments for properties that were never built or never finished. Until now, they have escaped the rules of Law 57/68 by presenting themselves as estate agents, but there is now some strong case law stating that the developer is whoever takes the off-plan payments on account. That means there is a last chance for buyers to claim for refunds from these companies.”

Keith Rule, CostaLuz Lawyers

Law 57/68 is the regulation under which those who lost deposits have successfully claimed against developers and banks for a refund. Claimants should have started proceedings by 7 October but that deadline has now been extended to 28 December 2020. This means that those who are out of pocket have a new window of opportunity. According to CostaLuz Lawyers, this could affect hundreds of buyers in the UK and Ireland.

The CostaLuz Lawyers team has already helped over 1,500 clients in their quest for financial justice. Those who now want their shot at obtaining a refund need to start proceedings before the new December deadline.

“28 December is the date by which action has to be started. But that just means sending a Burofax or submitting the Preliminary Diligences procedure – the actual lawsuit can be filed later, provided this initial action has been taken before the deadline.”

Keith Rule, CostaLuz Lawyers

Cases submitted to Spain’s First Instance Court will take around two years to complete, while those that go on to the Provincial Appeal court could take around three. Any cases that go all the way to the Supreme Court could mean that buyers are looking at five to ten years before receiving a final ruling.

For more information, please contact CostaLuz Lawyers’ UK office on +44 1908 635 111 and speak with Keith. To speak with Maria in the Spanish office, call +34 956 092 687 or you can visit www.costaluzlawyers.es