Buying an off-plan property in Spain can be an attractive option: new construction, modern design, payment flexibility, etc. However, it also comes with specific legal risks that every foreign buyer should understand before paying a deposit.
In this guide, we explain what buying off-plan really means in Spain, the most common problems buyers face, and the legal protections that exist to safeguard your investment.
What Does “Buying Off-Plan” Mean in Spain?
Buying off-plan means purchasing a property that has not yet been built (or is still under construction) directly from the developer or promoter.
Typically, the buyer pays the price in instalments: a reservation deposit, then several payments during construction, and finally the remaining balance when the property is completed and the title deed (escritura pública) is signed before a Spanish notary.
While this model offers flexibility, it also requires great caution: the buyer is paying for something that does not yet physically exist, and therefore legal protection is essential.
Common Risks When Buying Off-Plan Property
1. Delays and unfinished developments
Delays in completion are frequent. Some developers fail to meet deadlines, while others may never finish the project at all. Without proper legal guarantees, recovering your money can become a nightmare.
2. Developer insolvency
If the developer becomes insolvent or goes bankrupt, buyers can lose the amounts they paid unless those payments were properly guaranteed under Spanish law.
3. Missing or invalid bank guarantees
By law, every off-plan payment must be secured by a bank guarantee or insurance policy. However, some developers fail to issue them, or they are linked to the wrong bank or account.
4. Planning and licence problems
In some cases, developers start selling units before obtaining the proper building licence (licencia de obras) or the first occupancy certificate (licencia de primera ocupación). This can lead to serious legal complications and registration delays.
Legal Protections for Buyers Under Spanish Law
Spanish law offers strong protection for off-plan buyers, but only if those guarantees are correctly applied.
The main legal framework is Law 38/1999 on Building Regulation (Ley de Ordenación de la Edificación), later reinforced by Law 20/2015. Together, these laws establish:
- The obligation for developers to guarantee all payments made by buyers before completion.
- The requirement for a special bank account to hold the funds, used exclusively for construction purposes.
- The buyer’s right to claim a full refund (plus legal interest) if the property is not delivered on time or with the required licence.
However, to benefit from these rights, buyers must ensure that their payments are made through traceable methods and that the bank guarantee certificate is issued in their name before transferring any funds.
Essential Legal Checks Before Paying Any Deposit
Before signing or paying anything, you should make sure that:
- The developer owns the plot and it is free from charges or embargoes.
- The building licence has been granted by the local Town Hall.
- The bank guarantee or insurance certificate covers each payment you make.
- The building works have the corresponding technical supervision and insurance (seguro decenal).
- The purchase contract includes clear deadlines, penalties for delays, and refund clauses.
An independent Spanish property lawyer can verify all these points, contact the developer’s bank, and ensure that your investment is legally protected from the very beginning.
Why You Should Always Use an Independent Lawyer
The notary will only intervene at the end of the process, once the property is ready and the final deed is signed. Until then, no public official supervises the payments or contracts.
That is why having a lawyer is not optional, it is essential. Your lawyer will:
- Review all documentation before you sign anything.
- Ensure that your payments are protected by valid guarantees.
- Negotiate better terms and refund conditions.
In short: the lawyer protects your interests, while the notary simply formalises the sale at the end.
Final Word: Buy Safely, Even When It’s Off-Plan
Buying an off-plan property in Spain can be an excellent opportunity, but only if done with proper legal advice. Never rely solely on the developer’s promises or marketing materials.
👉 Before paying any deposit, instruct an independent Spanish property lawyer to verify that all legal guarantees are in place. This is the only way to make sure your investment is protected and that you will receive your property legally, safely, and on time.
📩 Contact our law firm today for a free consultation if you are considering buying off-plan in Spain. We specialise in protecting foreign buyers throughout the purchase process.
FAQ
Is buying off-plan in Spain safe?
Yes, if you work with an independent lawyer who verifies the developer’s guarantees and licences before you pay.
What happens if the developer goes bankrupt?
If your payments were secured with a valid bank guarantee, you can recover 100% of your money plus legal interest.
Do I need a lawyer for an off-plan purchase?
It’s not mandatory in Spain. However, in practice, it is absolutely essential. A lawyer ensures will provide the much needed protection.
What is the main law protecting off-plan buyers in Spain?
Law 38/1999 (Ley de Ordenación de la Edificación) and Law 20/2015, which require developers to secure all buyer payments through bank guarantees or insurance.
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