The Guide to Building your Own Property in Spain

Why you need a good project manager

Your basic requirements to ensure a smooth-running project are a good project manager (PM) and architect. A PM will help you with every aspect of the building process, coordinate work and contractors, negotiate on your behalf, recommend contacts that they have had good experience working with in the past, check payments and ensure you have adequate funds in your accounts. To hire the services of an experienced PM will cost you 4 – 5% declared project cost (mentioned below) but the benefit is you will more than likely save yourself money over the duration of the project.

Finding the right architect

A good architect will design the building project, and will also be able to assist you in checking the legal designations. Architects generally charge 8% - 10% of the declared value of the project and their advice, skill and contacts are essential.

Your PM will normally be able to recommend a good architect, but should you choose to find your own, you should ask to see his individual projects, this will give you a good opportunity to see the quality and style of work as well as speaking with his clients.

While you are assembling your core team of professionals you should also contact an agent who will be able to show you a range of plots that meet your requirements for location, orientation and consensual planning permission (check what form of proper back ground research the agent does). Once you have found your plot, the architect and lawyer can then go ahead and do the following:

Check that the land has an urban designation under the Urban General Development Plan (PGOU) or Plan Parcial in the land registry office in the town hall

Calculate the build specifications for the area such as percentage of the plot that can be constructed, height limitations for the building, etc.

Verify that the land has the correct access,

Check that the land has water, sewerage and electricity amenities connected or the ability for them to be connected by the time the building is ready,

Commission a topographical survey of the property to delineate the lands actual boundaries, (costs 300€ approximately),

If there are debts on the property (mortgage, taxes, amenities, etc), check that the seller has the legal rights to sell and other associated due diligence.

Provided that the above meets the requirements for sale your lawyer will then go ahead and set up the purchase contract. The VAT (IVA) charge for land in Spain is set at 16% of the declared sales price, and there are the usual costs associated with buying.

Once you have decided on the project and described what you want, the architect will then work on the renderings (paid for separately) and sketches of what the house will look like. Special points:

Visit the plot with your architect and ask him to:

1. Point out the extremes of the building and the exact level and view from your living room or terrace,

2. Protect the house against heat in the summer and get as much sun as possible in the winter,

3. Protect the open terraces from the prevailing winds,

4. Protect the foundations and walls against rain runoff,

5. Protect against existing or future sources of noise (roads, public pool, bar),

6. Think about sufficient storage room and cupboards.

He will also appoint a technical architect or aparejador (quantity surveyor) who works with the architect’s plans and calculates the strengths required and defines the types of methods and materials needed.

Once the basic idea of the project has been agreed, the architect then works on the project plans, which subsequently must be presented to the College of Architects and Town Hall for approval. There are two sets of plans that are worked on simultaneously:

Plan Básico - a simple plan with general information and renderings on the projects.

Plan de Ejecución – contains very technical information.

The Plan Básico allows the authorities to confirm that your basic design meets their requirements and for them to grant the initial permission or Licencia de Obra. The Plan de Ejecución contains all the specifications required for the Town Hall to give you written planning permission granting you the licence to build. The Town Hall charge 5% approx. of the “declared” value, but the declared amount is considerably lower than the actual costs.

The geophysical study must be carried out at the planning stage. It costs around 1000 to 2000€ and will allow the aparejador to identify the correct building techniques suitable to the land. Your architect should have a very good idea what kind of soil and problems may be encountered, however the survey will show if there are any soft spots or underground streams that must be taken into account.

While the plans are being approved, you can work on the quotes supplied from the various recommended builders. A good project manager and architect have their own trusted network of subcontractors, which can make all the difference to whether the project runs smoothly or not. The PM will also negotiate for the best deals on your behalf and present a range of possible companies from which you can make your selection. For further confirmation about the builders available you can ask your lawyer to do a due diligence and if you want to be really sure you can ask the builder for a bank guarantee (but this will cost extra). Your lawyer will then draft a contract accordingly, agreeing the works and costs including 7% for IVA (equivalent to Value Added Tax). The standard method for payments to the builder is as follows:

10% deposit on the signing of the contract for materials.

Monthly payment of bills from a certificate submitted by the builder that details the work carried out so far.

The 10% deposit is usual subtracted incrementally from these monthly bills over the construction period along with a 5% retainer that is kept for a specified period of time after construction to ensure that the work is finished according to your requirements.

Under Spanish law all new construction projects must come with a building insurance and guarantee of 10 years. Your insurance company will then appoint a registered technical survey company to provide the information required. The technical survey team checks the building progress and ensures that the correct methods are being implemented. They will come and check generally every time concrete is poured and take samples for laboratory testing. The survey work will cost between 2000 – 4000€ in total depending on house size.

As the project draws to a close the qualified plumber and electrician must supply a Bulletin that details the plans for the associated connections and materials used. With this information and an inspection by the PM the architect will produce a stamped letter or Fin de Obras, declaring that the project is complete. Your lawyers will then take this documentation and apply to the town hall for the First Occupancy Licence (your right to live in the property) and inform the notary with the relevant documentation to make the escritura or title deeds. Once ready, you will sign the escritura at the notary’s office with the notary and lawyer as a witness. With the escritura, your lawyer can now approach the utility companies and change the electricity and water bills from the builders supply into your name.

If you follow these basic guidelines you will minimise the risk of problems occurring during the build time. Generally self-build has a lot of advantages over buying an off-plan villa from a developer. You will be able to choose a plot that suits you in an area you like, you will also be able to build the property according to your exact specifications (within the limits set by the Plan Parcial) and you will save around 20 to 30% of the cost.

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