Off-plan real estate in Spain: how to reduce risks when buying a house during the construction phase

Off-plan real estate in Spain: how to reduce risks when buying a house during the construction phase

Buyers interested in purchasing a new house can do so in a variety of ways. One of the most popular options nowadays is buying under construction, which has many benefits for buyers. However, it is essential to know how to reduce the risks when buying off-plan property in Spain.


Why is it profitable to buy real estate off-plan in Spain?

Real estate construction deals have many advantages, primarily from an economic point of view.

Economic benefit

Savings can range from 10 to 15% of the final cost of housing. It is because the approval of the preliminary price excludes the revaluation of real estate.

The simplicity of payment scheme for off-plan real estate purchase

When signing the contract, you will only need to pay 10% of the total cost of housing. The remaining 10% is paid in instalments during the entire construction period.

No interest overpayments

Monthly payments do not include interest, as the apartment price is fixed at the time of purchase.

Growing investments

The commercial value of real estate increases from the time of purchase to the time of its construction. Thus, the owner benefits from valorization.


Part of the real estate under construction in Spain is subsidized by the government, which can significantly reduce the mortgage loan instalment cost.

Thus, you can save a lot when buying a property in Spain.

Off-plan real estate in Spain: how to reduce risks when buying a house during the construction phase

Pros and cons, risks when buying off-plan

Advantages of buying a house at an early stage of construction (off-plan)

Apart from economic real estate off-plan has many other advantages.

Individual accommodation

The homeowner can make specific changes to adapt the house to their taste (spaces distribution, kitchen type, building and finishing materials, floor, parking, storage room, decoration, etc.).

Modern technologies

The construction will be carried out under the latest adopted laws and regulations in construction, using the most modern materials and latest technologies.


Accommodation off-plan has the following guarantees:

  • 1 year - from faults in finishing.
  • 3 years - from damage caused by defects in structural elements.
  • 10 years - from material damage caused to the building by defects in the foundations, supports, beams, load-bearing walls or other structural elements that threaten the strength and stability of the object.

Another plus of buying an off-plan house is legal protection.

The law protects the future owner in the event of unforeseen circumstances in the house buying process.

Disadvantages of buying a house at an early stage of construction (off-plan)

Despite all these advantages, there are some disadvantages to consider when buying off-plan real estate.

  1. There is no way to see finished housing, and you can only look at the plan to get an idea of the house, its size and layout.
  2. The period from the commencement of construction work until the purchaser gains access to new housing is 18 to 24 months.
  3. Great uncertainty. There are always doubts as to whether a project will be implemented or not. Therefore, it is recommended to visit the construction site regularly and check that the work is in full swing.
  4. Any delay in deadlines results in more stress and potential additional costs. However, contract violations are regulated by the Law on Construction Management. Therefore, in case of delays, the developer must compensate every day of delay and even, in some cases, return part of the amount received to the account, as well as the corresponding taxes and interest.
  5. Ultimately, the result may not be as expected. For the buyer’s peace of mind, there are many guarantees for apartments in new buildings in Spain (both at the stage of construction and ready-made), which cover construction defects. Thus, damage can be claimed within an appropriate time limit.

Risks associated with buying real estate off-plan

Buying a house that has not yet been built is a risky undertaking.

Let us consider what are the risks when buying a house under construction in Spain:

  • Fraudulent sellers. Investing money in off-plan real estate is necessary only after making sure of the developer credibility.
  • Delaying deadlines. There may be delays due to external (rainy season) or economic factors that lead to an extension of the initial delivery date of the property or a complete “freeze” of construction.
  • Problems with documents. Unscrupulous developers may lack or be fake with the necessary documentation (building permits, etc.).

Off-plan real estate in Spain: how to reduce risks when buying a house during the construction phase

How to choose a reliable property for investment

Some tips on how to reduce the risks in a deal with a developer:

  1. It is necessary to check the information about the developer. Thanks to the Internet today, it is effortless to find articles about other objects erected by this organization, its reputation, or find reviews from other clients.
  2. Request from the developer official documentation confirming the existence of a permit for the facility’s construction, title to land. The Internet makes it easy to follow links.
  3. It is advisable to keep copies of documents provided by the developer, including commercial announcements. If in the future any disputes arise, which in the worst case will turn out to be in the judicial sphere, any document can serve as evidence confirming the client’s legitimate interests.
  4. The following points must be spelt out in the private contract:
    • VAT, before signing it is necessary to confirm whether it is included in the price.
    • Completion date of the object. In case of delay in the housing delivery, it is necessary to remember that the period for demanding the return of the advance amounts is two years.
    • The number of fines that the developer will pay in case of delays in work.
  5. Failure to fulfil obligations. It is necessary to familiarize yourself with the possible consequences in case of non-compliance with the contract terms by both parties. Indeed, there are cases when the developer does not fulfil the conditions and is barely punished, while the buyer suffers significant economic losses.
  6. Check the detailed technical passport. It is a document with detailed information about the materials that will be used in construction, interiors, and, if possible, common areas, as well as the objects that will be located in the house. Thus, having read the technical data sheet, it will be possible to imagine the future housing as realistically as possible.
  7. Housing must be rented out upon receipt of the final building certificate and settlement permit. You should not sign the document if there are flaws.
  8. If deficiencies have been found, it is necessary to inform the developer about it as soon as possible. If the dispute persists, it is recommended that you explore possible legal solutions.
  9. One way to mitigate any risk is to require the developer in Spain to write that the entire amount received from the buyer will be used to cover construction costs.

These recommendations contribute to investments security when buying real estate in Spain at the stage of development.

Is it profitable now to buy housing under construction in Spain?

According to the latest data from the New Build Buyer Profile 2020‒2021 report conducted by the Fotocasa Research project, over the past twelve months, most people (61%) who have considered buying a house in Spain have chosen new buildings. The survey also shows that almost a third (30%) of those who bought a house last year chose new buildings. At the same time, in Madrid, 38% of buyers prefer newly built properties in Spain, while this figure is 21% in Catalonia. Many of them preferred the off-plan option.

Off-plan or ready-made housing

As part of buying a new house, there are two ways to purchase: turnkey or under construction.

Even though more and more housing is purchased during the construction phase, many people experience some fear and prefer to buy ready-made projects.

Finished properties can be seen in real-time (not just plans or models); actual finishes, interiors, etc. can be assessed.

However, the purchase of housing off-plan also has advantages: payment during the entire construction period, agreement on the property price from the very beginning in agreement with the company, making changes to the original plan at the request of the consumer.

Moreover, this type of purchase is more economical as the property price is cheaper. In addition, it is a safe and profitable investment since after the house is delivered, its commercial value increases.

The latter aspect is the main disadvantage of buying a house in a turnkey project as the cost gets higher.

The disadvantages of finished housing can also include the following aspects:

  • It is more complicated, sometimes even impossible, to change the design and materials, and all changes are made independently.
  • There is no possibility to pay for housing in instalments. Therefore, you need to have 30% of the cost of housing for mortgage lending or one hundred per cent financing.

Thus, it is impossible to give a definite answer, which is better - off-plan or ready-made housing, since each type has defining advantages and disadvantages depending on the buyer. The decision depends on the economic situation and the urgency of the settlement.

Thus, buying an apartment under construction is a common way to acquire real estate, which many buyers welcome. This procedure has many advantages, provided that attention is paid to detail and there is a guarantee that everything agreed with the developer will be followed.

Off-plan real estate in Spain: how to reduce risks when buying a house during the construction phase

Safely invest in off-plan real estate in Spain

Are you dreaming of living in a new building in Spain? The website of the Spain-Real.Estate company contains the most relevant off-plan housing offers from trusted developers. Our company will take care of your investment security when buying real estate in Spain at the stage of development. Dreams come true with us!

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