Calls

Hi All,

Can some one help me please.

My father recently passed away, he had a property on the Costa Del Sol which I have now inherited. (or in the process of)

I have employed a lawyer who is sorting out the inheritance side and has also uncovered some problems with the property paperwork.

Some are being sorted and paid for. One I have a problem with which I am hoping someone has some knowledge or experience with:-
Below is part of an email I have received from my lawyer:-

Segregation Licence:

As explained, the issue of Segregation License appeared to be a more difficult task.

We firstly made contact with the Urban Planning department of Antequera Town Hall and they told us that it didn't appear any licence as per their records. Additionally we called Mr Francisco xxxx, the person who sold the property to Mr xxxxxx, and he explained that there wasn't any licence of segregation because the surface of the plot segregated was smaller than the minimum one which is compulsory under Spanish Law. In fact this is the reason why he couldn't register his property at the Land Registry.

So now this has been clarified, unfortunately it seems we cannot proceed with the registration due to the lack of segregation license.

In view of that, bearing in mind that the property cannot get to the Land Registry, it may happen that you find certain difficulties to sell the property, unless you find a purchaser who is not bothered about the Land Registry situation and accepts the property as it is from the legal point of view. You can prove there is a legal title on the property but no records at Land Registry. This is obviously a disadvantage because the property does not comply with our legal system.

In any case, you would first need to complete the inheritance proceeding by signing the notary deed whereby the property is transferred to the inheritors and pay the inheritance and plusvalia tax. That would give you at least the legal title on the property, although as we now know its registration is not feasible. If you want to sell the property at least you need to have the legal title on it and comply with the tax duties resulting from the inheritance. My suggestion would be completing the proceeding in that way but please confirm your instructions to proceed in such manner (perhaps you wish to reconsider instructions now that it is confirmed that registration is not possible).

Is there anyway that I can sort this so the house can be registered.

Thanks for reading.

Lisa:

Mitzyboy

Firstly, sorry to hear of your loss, and welcome to the forum

Oh dear, it seems the property was not legally registered properly at the time of sale, and it seems the solicitor is telling you it is not possible to register it with the land regstry, even though it appears there are some title deeds. This basically means I think that no one will be able to raise a mortgage against the property.

Can you confirm, is there an escuitura (title deed) for the property? Just trying to ascertain if this is actually an illegal build or not.

valenciatim

Mitzy, there is a previous thread on this by the OP back in January. It may help to fill in the blanks!
Tim

Mitzyboy

Oh Crap, is it the same poster
I didn't realise sorry

In that case it doesn't look good does it

SueG

It looks as though the title is legal according to the Solicitors but just unable to be registered at the Land Registry. Don't forget in England the same situation arose when people purchased property quite legally but until the mid 1980's it was not required to be registered at the Land Registry in England. When I left the UK in December 2006 I was selling properties for elderly Vendors that were not registered as they had not changed hands or remortgaged for a number of years.

The Solicitor states that it cannot be registered so I cannot see how there is a way around it if he can't do the necessary. Sorry!

P.S. Mind you I am not expert on Spanish property law

Calls

Thanks for taking the time to read my problem and reply.

Another thought is, is there anyway that I could get the plot registered as urban as it is currently classed as agricultural which is why there is a problem with the plot size. This may then allow me to registed the property. Or could a possibility be to purchase more land to increase the plot size to meet the legal reguirements for agricultural land. (does anyone know what this is?)

I feel that I am paying out money for rates, taxes, solicitors, etc and will never be able to sell the property to realise any of the money that I am spending currently. Am I in an impossible situation or could there be any light at the end of it all?

Hillybilly

I think that the min plot size for agricultual land is now 30000m2 in your area (and there are restrictions even then) but maybe someone else could confirm that, so you would need to buy an awful lot of land and your neighbouring owners would know they had you over a barrel. Plus at the mo, no permissions are being given for new builds on agricultural land, so you may meet a stumbling block there anyway (although I know you're "only" wanting to legalise, not build).
IMHO your best bet is to investigate something your lawyer has said which is to find a buyer to whom the status of the property doesn't matter. As long as you are up front about it and price it accordingly, there is no reason why it cannot be sold in its present "illegal" state. Spanish buyers are more likely not to be put off by this although I know of expat buyers too who knowingly and willingly choose to buy "illegal" properties, despite being advised otherwise.
Reclassification of land is out of your hands I'm afraid. But your lawyer could investigate with the town hall if there are any plans afoot to increase the urban footprint of the town/village.

Mitzyboy

Well ...... this is a bit confusing. If its been built on agricultural land then surely it is illegal. As I asked before, do you actually have a habitation certificate and land deeds in your fathers name?

spanishfamily

This is a very difficult time for the owners of the innumerable illegal properties in rural Spain. I agree with Hillybilly that the Spanish are more likely to buy an illegal house - all the recent publicity about demolitions has made most British buyers very nervous and with good reason! Ten years ago the legality or otherwise of a property would have been completely unimportant to Spanish buyers, though now even they are starting to realise the importance of registration (especially as many hope to sell their homes to rich(!) British people). Chances are that some locals may well be interested in your house and may be your best bet for a sale, even if they do try to knock you down on the price! Hope your problems are sorted out soon!

Calls

Yes there is paperwork in my fathers name as detailed below.



Purchase deed signed on 27 april 1993 (the vendors Mr. and Mrs XXX purchased the land from Mr MMMM and Mrs FFFF): it is necessary to deliver the Segregation License issued by the Town Hall. This was advanced under our report.

B) New Building Declaration Deed signed on 10th april 2000 (the vendors Mr. and Mrs XXX notarised the house description by signing the New Declaration Deed): it is necessary to evidence that the transfer tax/stamp duty was paid at that time. We have no proof in our records.

C) Purchase deed signed on 5th September 2002 (signed by verbal attorney Mr. SSSS which was ratified by Mr HHH on 23rd September 2002): it is necessary to evidence that the transfer tax/stamp duty was paid at that time. We have no proof in our records.

IBI local rates payment - These have now been paid and are upto date

It all seems so confusing as I feel that I am having taxes and inheritance tax on a property that is worthless. And I am just told that the property value will not ttake into account the paperwork issues, as it is different government/tax departments.

Its three steps forward and eight back!!

Another option to raise funds would be to rent it out but there are also sturctural problems with the house that also need money spending on it.

Could it really get any worse?

jdr

I would balance up what you are going to make if you even make a sale against what it`s going to cost you in taxes and take a choice.
Is it financially viable or do you cut your losses and forget about it ?

Calls

I can understand what you are saying because I have thought it. But my father has put about £150,000 into this property. He was a fantastic builder, and was probably an early property developler. Even restoring a derelict cottage that had a tree growing through the centre of it to become a chocolate box thatched cottage, when he had finished with it.

It is the easy option to walk away, but is it the right thing?

Mitzyboy

As JDR says, you need to weigh up the worth of it, and also consider if you are going to be able to live with the knowledge that someone will come along and take the place over if you walk away

I dont know all the figures involved, but as you say there is always the option to rent out and regain the money over a period of time, and in the meantime over a long period you may find a buyer who doesn't care about the registration

SueG

Can I ask where did you get the above information from?

jdr

It`s an awkward situation but you can`t afford to be sentimental over it really, I know it sounds harsh but you need to make a decision sooner than later if it is costing you money,
Add onto what he paid, your inheritance tax, lawyers etc, if you can find a buyer they will offer peanuts for it, but then if you don`t mind the hassle and you think the sums are right then go for it.