When does the new Act come into effect?
It was ratified by parliament on 11.03.2014 and must be approved with an absolute majority by all of the Island Councils. Menorca and Ibiza have already passed the law. This is due to happen shortly in Mallorca.
What does the Act entail?
Generally speaking, it is an integral regulation of urban activities and deals with the simplification and rationalisation of construction regulations. All of this has been implemented in concrete form as follows:
- Faster issuance of building permits (e.g. approval for smaller structures by means of simple, advance registration).
- Amnesty: legalisation of properties “not in compliance with zoning regulations”.
- More stringent penalties and greater liability of those involved (builders, technicians, civil servants, authorities, etc.).
How should a property “not in compliance with zoning regulations” be interpreted?
This definition largely relates to the following kinds of properties: “Houses or structures that were built at some time without a building permit from the municipality and could not be legalised because this was impermissible under urban development regulations.”
What have been the consequences for a property “not in compliance with zoning regulations” to date?
- Refurbishment and/or extension work may not be carried out (only maintenance and preservation).
- Not possible to apply for connection of electricity, gas, water, sewage, telephone, telecommunications, etc.
- Not possible to obtain a habitation licence (in the event of absence or renewal) if property was not built before 1987.
Which buildings “not in compliance with zoning regulations” can be retroactively legalised under the new Act?
The buildings must fulfil the following conditions:
- Building is on a plot designated as “rural”.
- The statute of limitations on the urban development offence must have been reached. The statute of limitations is usually eight (8) years.
- No file concerning an urban development offence may be extant at the time of legalisation.
- For buildings in nature conservation areas (ANEI, ARIP and areas of special natural interest and their variants) the statute of limitations will be deemed to apply to the offence if it can be proved that the building was erected before 10.03.1991 (provided that no extension or repurposing was subsequently effected).
Many house and finca owners attended the Brunch and used the opportunity to inform themselves about the latest real estate legislation.
Are there deadlines for retroactive legalisation?
The deadline is three years, calculated from the publication of the acceptance by the Island Councils’ committees. Once this deadline has lapsed, legalisation is no longer possible.
What does the legalisation process look like?
Graphic documentation of the property’s actual condition must be submitted to the local authority in the place where the property is situated. This must include adaptation to the general provisions regarding integration into the environment and the landscape.
Sebastian Boelger (centre), Head of the sales region North, talking to clients.
What fees, taxes and penalties have to be paid in order to legalise a property?
The same fees and taxes are calculated as for new buildings (around 4% of the value of the structure; depending on the municipality).
The penalty (known as a “financial contribution”) is calculated on the basis of the year in which the legalisation was initiated:
- Year 1: 15%
- Year 2: 20%
- Year 3: 30%
The penalty is calculated on the basis of the material construction costs of the building/parts of the building to be legalised, that were set out during the processing of the file.
How many properties can potentially benefit from the new Act?
Around 25,000 properties, inclusive of the associated increase in value and the concomitant economic revival of the Balearics.
We extend our warm thanks to solicitors Guillermo Dezcallar Enseñat and Javier Blas Guasp from the legal firm ILLESLEX for coming here, and for their interesting explanations. Do you still have questions about the new Land Act? We’ll be happy to pass on your queries to our legal experts.