Off Plan Property Spain

Off plan property Spain, the main advantages and some dis-advantages...

With so much building going on, so much development, its difficult not to get caught up in the frenzy off buying off plan property in Spain.

When I was looking to purchase my current home just over 2 years ago I trawled around all the new home sites, being convinced that every apartment in the development would end up looking just like the show home..

In one development I had to wait 40 minutes for an appointment just to view the show flat, there were literally queues of people waiting to pay their deposit.

Buying off plan property in Spain is a bit like buying a new car, no one else has lived there and everything will be new and shiny.

But is it worth it, what's the benefits...

A lot and I mean a lot of people have been making some serious money over the last few years buying off plan property in Spain. For any would be investor here's how the numbers work...

An Investment view example of off plan property Spain..

You agree to buy an apartment for say €150,000. The terms from the developer state that you pay 10% straight away, 10% in 12 months time and a further 10% after 24 months. When the property is finished at 30 months you pay the remaining 70% either by a Spanish mortgage or cash.

So lets say you put down 30% of the money but during the last six months of the development you sell the property to someone else. By the time you sell, the Developer is selling the last phase for €195,000. So you sell yours for €195,000 and allow the new owner to complete the sale of the property at the new price.

You make a profit of €45,000 from an initial investment of just €45,000.

Hang on you ve doubled your money, inside three years!

What about all the completion taxes and expenses...

They are all taken care off by the new buyer, you see you never technically owned the property, you sold the rights to own the property.

Yes there's capital gains tax and all that stuff but you can see why so many people have been doing it.

So where's the downside with off plan property in Spain..

Well if you cant find a buyer before completion you will have to complete the sale which means finding the remaining 70% plus the 10% costs of purchase.

The other real problem areas are more to do with the developer and development.

Buying off plan property in Spain is buying someone else's vision, someone else's dream, sometimes they may not end up looking how you expected, sometimes that fantastic sea view is obscured by a roof or worse still another development that was not even planned when you paid your deposit.

Finance is another key point, most of the good developments are under written by the large Banks, they guarantee to keep your money safe and protect the financial integrity of the development.

The other downsides with off plan property in Spain are a bit more subtle and vary from development to development....

Most of the prime land, the real prime locations, are already built on. So many new developments in Spain are built in secondary locations, ones where the facilities aren't quite in yet, the roads, shops etc.

The "New" this or the "New" that.

On the Costa Del sol we have "The New Golden Mile" and "The New Golf Valley". What happens in ten years time when they build another area 10 kms down the road, "THE NEW NEW GOLDEN MILE".

Apart from the other obvious worries about what the gardens will look like, what will the building look like in 3 years, who will run the complex, how much will the service charges be etc

There is one other area that is starting to worry me with off plan property in Spain....read on.

Within this guide we also have advice and information on Buying property In Spain, Finding Property in Spain, Estate Agents in Spain, The Costs of Buying Property in Spain, Buying an Apartment in Spain, Buy to Let in Spain, New Developments In Spain, Off Plan Property Spain Property in Spain, Resale Property in Spain, Investment Property in Spain, Rental property In Spain, and Property Management in Spain