The question of whether or not buyers need a survey can actually be answered by a significant proportion of new build owners, most having experienced various problems with their new properties, ranging from what are almost ‘live with’ minor issues right through to serious defects that require them to vacate their ´dream´ homes. In hindsight all these owners will openly confirm their regrets at having not known surveyors existed in Spain or in reliance on the 10 year ´Guarantee´ simply assuming or taking an agent or developers word for it that there was ´no need´ for a survey. Some developers (including some of the biggest names) have on occasion outright refused access for a survey prior to completion only to then ignore issues of complaint later.
While builders are legally bound to abide by guarantees, the law will not protect property owners unless they are willing to take court action to enforce it. If a developer is cash rich and conscientious an owner may be lucky enough to get an early response to defects complaints and a quick and proper long term solution, however the words ´Cash rich and conscientious’ along with ´quick and proper´ will no doubt have caused a cry of ‘fat chance’ for some readers of this article, as even some of the largest developers are strapped for cash, far from contentious and highly unlikely to respond promptly or adequately when the house they have sold proves to be defective. Considering that some proper defects repairs will actually wipe out or exceed the original profit on the build, it is clear why some builders keep a low profile or fold their operation, before court demands are made.
If a builder ignores complaints or disappears, most owners seek salvation via the ‘Decenal’ 10-Year Property Insurance (an insured requirement since May 2000) only to find out that if in existence (when an owner is registered as ‘Auto Promotor’ the guarantee normally won´t exist), it may well only cover structural stability issues or for example only covers the house and not a subsided pool. Further to this the insurance assessor will invariably direct the claimants back to the builder or project architect and simply refuse to accept the claim unless they are forced to pay out following a lengthy court battle. Though the ‘Decenal’ 10-Year Property Insurance insurers are actually in breach of their legal responsibilities by not accepting genuine covered issues regardless of responsibility (i.e. whether or not the builder or architect is proven to be at fault), if the insurers won´t accept the claim (which is the norm) the owner still faces a court battle.In short Builder´s Guarantees are to date* no immediate salvation for owners.
*In time case law may help encourage early claim acceptance from ‘decenal’ insurance companies and I am involved with a number of pending cases in an effort to establish some case law for this relatively recent ‘Licence to print money’ for insurers that have taken billions in premiums but are so far seemingly unwilling to accept claims even when owners have a clear case.
NB: Information for advice purposes only. All property buyers should seek independent legal advice and fully understand the terms of all ‘guarantees’ and insurance policies when purchasing.
Article supplied by Mark Paddon BSc Hons Building Surveying. MCIOB. FAS. CAAT. Click here for further information and contact details.