What Off-Plan Property Really Means

Off-plan means you are buying a property that does not exist yet.

You see a render. You see a model unit. You see a floor plan. You pay money for something you cannot walk through, cannot inspect, and cannot value against anything real.

That is not automatically a bad deal. Off-plan is how a lot of people on this coast bought well. But the person showing you the model unit works for the developer, not for you — and almost nobody explains what that actually means until after you have signed.

So here it is.

How Off-Plan Actually Works

The structure is nearly always the same on the Costa del Sol:

• Reservation. You pay roughly €6,000–€10,000 to take the unit off the market, usually for 15–30 days.

• Private purchase contract. Within those weeks you sign and pay a deposit, typically 10–20% of the price.

• Staged payments. Further instalments during construction, tied either to build milestones or to fixed dates.

• Completion. The remaining balance — usually 50–70% — at the notary when the property is handed over.

Between the reservation and the keys, two to three years can pass. Your money is in the developer's project the whole time.

The Part That Protects You — And When It Doesn't

Spanish law requires developers to guarantee every payment a buyer makes during construction. Your money must sit in a special dedicated account, and the developer must give you an individual bank guarantee or insurance policy covering the amounts you have paid.

If the development is never finished, that guarantee is how you get your money back.

Here is the part the sales office will not lead with: this obligation applies once the developer holds the building licence. Money handed over before the licence exists is in a far weaker position.

So the questions are simple, and you ask them before you pay anything:

• Do you have the building licence? Show me.

• Which bank issues the guarantee?

• When exactly do I receive my individual guarantee certificate?

A serious developer answers all three without hesitating. If the answers get vague, that is your information.

What Off-Plan Costs Beyond the Price

New-build is taxed differently from resale. This surprises people constantly.

• VAT (IVA) at 10% on the purchase price — not the 7% transfer tax you would pay on a resale in Andalucía.

• Stamp duty (AJD) at 1.2% in Andalucía.

• Notary and land registry fees.

• Legal fees — typically around 1% plus VAT.

Budget roughly 12–14% on top of the headline price. If someone tells you "about 10%", they are rounding in the developer's favour.

The Real Risks

Delays. They are normal, not exceptional. Your contract should name a delivery date and a grace period, and it should say what happens when the developer misses both. If the contract is silent on that, ask why.

The licence of first occupation. Until the town hall issues it, the building cannot legally be occupied and utilities cannot be properly connected. Completion should be tied to it.

What you get is not what you were shown. Renders are marketing. Check the contract for the developer's right to make changes, and check the quality specification — the memoria de calidades — line by line. That document, not the brochure, is what you are actually buying.

Snagging. At handover you inspect and list every defect before you sign. After you sign, your position weakens considerably.

What You Are Actually Protected By

New builds in Spain carry mandatory warranties from the developer:

• 1 year on finishes

• 3 years on habitability and functional defects

• 10 years on structural elements

These are real and enforceable. They are also one of the genuine advantages of buying new rather than a forty-year-old apartment with a repainted damp problem.

Off-Plan vs Resale - Honestly

Off-plan makes sense when: you are not in a hurry, you want a warranty and modern energy efficiency, you want to choose finishes, and you are buying in an area where prices are moving up during the build.

Resale makes sense when: you need the property now, you want to see exactly what you are buying, you want to negotiate against a real comparable, or you are buying in an area with heavy new-build supply.

There is no universally correct answer. There is only the answer for your situation — and the person who tells you off-plan is always the smarter buy is telling you about their inventory, not about you.

The Structural Problem

Walk into any sales office on this coast and you will be treated well. Coffee, floor plans, a walk through the model unit, a friendly conversation.

That agent is paid by the developer. Their job is to sell the units in that building. They are not lying to you — they are simply not working for you. Those are different things, and the difference costs buyers money every week on this coast.

A buyer's agent sits on the other side of that. Same market, same developments, same access — but the questions above get asked on your behalf, before you pay a reservation fee, not after.

Buying off-plan on the Costa del Sol?

I represent buyers only — never sellers, never developers. If you want a second opinion on a development before you sign anything, get in touch.

📩 stefan@auxtagency.com 📱 (4) Instagram

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This article is general information, not legal advice. Always instruct an independent Spanish lawyer before signing a reservation or purchase contract. Tax rates and legal requirements change — verify current figures before relying on them.