The market reactivated on April 13, with restrictions, procedures and an action guide in place in order to prevent against the further spread of Covid-19. While it’s certainly not business as usual, according to Fuster & Associates, it is a move back towards some semblance of normality for the sector.
The latest news is that Spain, which has currently recorded the second largest number of deaths in Europe from Covid-19, is aiming to ease lockdown measures in the second half of May – although restrictions could be re-imposed again if infections start to spike.
So where does all of this leave buyers in Spain’s second homes market?
“The coronavirus pandemic has surprised many of those who were previously happily on track to fulfilling their dream of buying a second home in Spain,” David Fuster, a property lawyer and the founding partner of Fuster & Associates, said.
“In some cases, it has stopped the process entirely, while in others it has made moving forward with the purchase far more difficult, leaving many future owners worrying about their options.”
Fuster & Associates has found that some future buyers have started to question their decision to purchase in Spain in light of the pandemic. On the other hand, others are determined to go all the way and succeed with their Spanish property ownership dream.
The company itself says it is continuing to work for clients as normal, working closely with developers, notaries and real estate agents so that clients’ purchases and sales are not frustrated.
“It’s still perfectly possible to purchase the home of your dreams here in Spain,” Fuster explained. “Buyers just need to take additional precautions to ensure the quality, safety and efficiency of the purchase process.”
Having a good lawyer is key to a safe purchase process, Fuster says, while those looking to take a belt and braces approach have the option to buy properties that have been quality approved with the Fuster Standard. “This important quality mark assures the buyer that all legal requirements for sale have been met, so that they can go ahead and purchase with peace of mind,” Fuster adds.
The firm warns, though, of some inevitable delays to the process for those buying new-build homes in Spain. On March 29, the Spanish government decreed the closure of all non-essential activities for two weeks in an attempt to try and curb the rapid spread of the coronavirus, with that closure including construction companies. As a result, and despite the industry gearing up again on April 13, disruption to the completion timetables of homes under construction will be unavoidable.
The Fuster & Associates team say that buyers considering signing a contract and making payments at this stage need to hire a lawyer to increase the security of the process and protect their investment. A bank guarantee can help them to do this, provided the developer has a construction licence.
Meanwhile, if a deposit was paid prior to the licence being in place, a ‘decent property lawyer will be able to obtain other safeguards’.
“For us, establishing a controlled process so that our clients don’t take risks is our top priority,” Fuster explains. “This is the mindset that gave birth to the Fuster Standard in the first place. We are now facing uncertain times, so the reassurance that the Fuster Standard affords the buyer is more important than ever.”
Before signing the deed, an inspection visit is customary. However, with domestic travel severely restricted and international travel all but impossible, such visits cannot currently go ahead.
As a result, some sellers are taking the inspection visit online, with virtual tours. Others, meanwhile, are making an annex in writing to the deed, so that ‘the process can move ahead with the promise of resolution of any issues taking place after this exceptional situation has passed’.
For resale properties where the purchase is already in progress, both the buyer and the seller must fulfil the obligations in the contracts that they have signed, Fuster & Associates advises.
If sales aren’t formalised, the buyer could lose their deposit. If the seller backs out, on the other hand, they will have to pay double the deposit amount to the prospective buyer.
“The problem with this is that the buyer may find that the seller is abroad and unable to get home to hand over the keys,” Fuster continues. “Likewise, the seller may need to take furniture out of the property before the sale completes but find themselves unable to do so.”
In such cases, Fuster & Associates advises the parties to agree an extension to the deposit contract, which can be achieved through a private agreement between both parties, without the need for a trip to the notary’s office.
The company also points out that real estate agents have plenty of tools at their disposal with regards to enabling would-be buyers to find out about properties online.
“Buyers who invest their time in research during the lockdown can therefore be well-prepared for when the travel restrictions ease and they can visit their preferred property and make a firm decision to purchase,” Fuster concludes.
For more information, you can contact Fuster & Associates on +34 965 271 505 or visit www.fuster-associates.com.