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Lanzarote Villas - Buying Off-plan - What to Watch Out for

There are plenty of new and resale properties for sale in Lanzarote ideal as an investment or for renting out. But maybe you canīt 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 itīs been built. So in effect, youīre buying blind from just a plan of the property. Letīs look at the advantages first. The main one is monetary. By the time your villa is completed itīll almost certainly be worth more than you are going to pay for it. Youīll have signed a contract for the property at a fixed price and thatīs 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 donīt actually see what youīre 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 hasnīt 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 isnīt 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 thereīs always the chance that property prices may fall and you could end up paying more for your villa than itīs 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.

About the Author: Bob Dickie lives in Lanzarote and runs Luxury Villas Lanzarote who offer a wide range of private luxury holiday villas across the island to suit every budget. Living there, he knows every area and villa very well and can offer extensive up to date information regarding all aspects of your holiday. You will benefit from booking direct with the villa owner at lower prices. Visit Lanzarote Villas.

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