Buy or build a home in Spain?

Buy or build a home in Spain? This post weighs up the two options: buying a house that is already finished, against building your own. As architects we are, on paper, the last people you would expect to be neutral about this. Don’t take it as read which way we lean. Developer-built homes are built too, and an architect signs those as well. Our fee is the same whichever route you take, so we have nothing riding on your decision — and even if we had, we would try to be objective.

A word on vocabulary first, because Spain splits in two what the UK calls self-build. Act as your own developer and you are the autopromotor: you commission the architect, hire the builder and carry the risk. Take on the building work as well and you are the autoconstructor. Spanish law treats developer, builder and architect as three separate roles with three separate liabilities, so it matters which hat you are wearing.

Advantages of buying a finished home

The most obvious advantage is that you skip the uncertainty and the time the building process takes. What you see is what you get: you are not buying off plan. On top of that, in the years since the crash it has been possible to find both new-build and resale property at very keen prices. If the house is where you want it and how you want it, buying something already built is a perfectly good option.

Drawbacks of buying a finished home

Against that, you don’t get to design it around the way you actually live: layout, materials, fittings. Almost everyone who buys a finished house makes compromises, and there are always details that would have been done differently had they built it themselves.

An existing house is also no guarantee against hidden defects (vicios ocultos). On a new build Spanish law does give you some cover. The Ley de Ordenación de la Edificación sets ten years for structural defects, three for habitability and one for finishes. Useful cover, but making a claim is a good deal slower than not having to.

And a house that is already built, especially a new one, carries the builder’s profit and the developer’s profit in its final price. The same house built by you, as your own developer, will always come out cheaper: you take on the development and the building work yourself, and those margins stay in your pocket.

Advantages of building your own home

In an earlier post (in Spanish) I made the case for building your own, so I won’t labour it here. I’ll set out the two points that matter most to me. You get the house exactly as you want it. And you remove the developer’s margin if you promote it yourself, and the builder’s margin if you build it yourself.

Drawbacks of building your own home

The fundamental drawback is the uncertainty that runs through the whole thing, building work and paperwork alike. As a rule the self-builder has never built anything before, and the risk and the not-knowing are not much fun. This is a long process and a very substantial investment.

The paperwork is where overseas buyers tend to get caught out. Planning permission (licencia de obras) is granted by the town hall on the basis of a complete architect’s project, and how long that takes varies from one municipality to the next. Here I’ll drop the pretence of objectivity and say that with sound technical and legal advice — a good architect and, where it is called for, a good lawyer — the process needn’t carry any great risk.

To finish, here is a summary of the ground covered above. The decision is yours, of course, and although it should be led by your head, it is worth listening to your gut as well.

If you are weighing up a plot against a finished house on the Costa del Sol, run the numbers on both before you commit to either. That is a short conversation, and it is normally a good deal cheaper than the alternative.