Buying a Lanzarote Villa Off-Plan
Buying a Lanzarote Villa Off-Plan
Buying a Lanzarote Villa Off-Plan
There are plenty of new and resale properties for sale in Lanzarote ideal as an investment or for renting out. But maybe you cant find the right one or perhaps someone else has beaten you to it. Another option is to buy offplan, but what are the advantages and the pitfalls?
Buying offplan is where you buy a new villa or apartment on a new development before its been built. So in effect, youre buying blind from just a plan of the property. Lets look at the advantages first. The main one is monetary. By the time your villa is completed itll almost certainly be worth more than you are going to pay for it. Youll have signed a contract for the property at a fixed price and thats the price you pay on completion. Often you will be asked to make stage payments to the developer as the building proceeds. On average, by the time you move in, the value will have risen by about 15 to 20% of the contract price. Other advantages are that often you may be able to make alterations to the design or content of your property as building work proceeds - at a likely extra cost of course! Generally speaking though, there is less hassle buying this way as there is no pressure to get the financial and legal side completed very quickly before you are beaten to it by someone else. You just need to pay the deposit to start off which gives you plenty of time to raise the rest of the capital before the first stage payment is due.
There are of course disadvantages, the main one being that you dont actually see what youre buying until its completed many months down the line. It may not turn out to look like you had thought! Perhaps the area round about hasnt been finished off as you had been led to believe or that villa next door is much closer than you thought it was going to be. Or the quality of the workmanship isnt up to the standard you expected. Whilst most builders in Lanzarote will offer a 10 year guarantee on the property, there is no NHBC like in Britain to settle any disputes. Also, quite often new builds go well past the estimated completion date. This is Spain remember! Try and ensure that you have a completion date in your contract with penalties if the property is not completed on time. Normally though, the builder will have a few months grace to complete. Finally, bear in mind that theres always the chance that property prices may fall and you could end up paying more for your villa than its worth when you take the keys.
To avoid these pitfalls, make sure you do your homework before signing any contract, and above all, take legal advice. A good independent lawyer (not the builders!) will be able to offer advice and local knowledge. If you are careful and choose wisely, you can end up with your dream property at a price you can afford.
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