Editorial transparency and use of artificial intelligence
This article forms part of the CostaLuz Lawyers blog and is published for general informational and educational purposes only. It was prepared with the assistance of artificial intelligence tools and, before publication, was substantively reviewed and editorially approved by Maria de Castro, a Spanish-qualified lawyer registered with the Cádiz Bar Association under number 2745, founder of CostaLuz Lawyers and the person responsible for the editorial review of the published content.
This article does not constitute legal, tax, immigration, employment, estate-planning or investment advice and does not replace an individual assessment and the professional work of the appropriate CostaLuz Lawyers specialist. No action or omission should be based solely on this information.
Madrid’s property market continues to gain momentum. Recent data shows that house prices have increased by around 18% at the beginning of the year, reinforcing a clear trend: strong demand, limited supply, and increasing pressure on buyers.
For international clients, this creates both opportunities and risks. The key is not just where to buy, but how to buy safely.
At CostaLuz Lawyers, we always say the same:
In a rising market, legal security becomes even more important than price.
Understanding the difference: Off-plan vs Resale
Not all property purchases are the same. In Spain, the legal work (“conveyancing”) differs significantly depending on whether you are buying:
- a new build / off-plan property, or
- a resale (second-hand) property
Here is a clear comparison:
| Aspect | Off-plan property | Resale property |
|---|---|---|
| What you are buying | A future property, under construction or not yet built | An existing property |
| Main risk | Developer delay, non-completion, licence issues, loss of deposits, lack of legally required guarantees | Charges, debts, hidden defects, registry or planning issues |
| Key due diligence | Developer, land ownership, building licence, bank guarantees, contract terms | Land Registry search, ownership, charges, taxes, community fees |
| Main document | Private purchase contract with staged payments | Reservation/arras contract + title deed |
| Payments | Instalments during construction | Deposit + balance at completion |
| Buyer protection | Bank guarantee/insurance for advance payments | Protection through Land Registry after completion |
| Critical moment | Before signing and paying any deposit | Before reservation and before completion |
| Lawyer’s role | Prevent risk from the beginning (developer, legal structure, guarantees) | Ensure clean transfer of ownership |
| Litigation risk | Delays, licence issues, breach of contract, deposit recovery | Hidden defects, unpaid debts, occupancy problems |
Why this matters (and where buyers make mistakes)
Many buyers assume that buying off-plan is simpler because the property is “new”. In reality, it is legally more complex.
With resale, you are verifying something that already exists.
With off-plan, you are trusting something that does not yet exist — which means:
- You depend on the developer’s solvency
- You rely on correct licences and planning
- You need proper legal guarantees for your money
- You must understand the contract structure in detail
This is why off-plan purchases require a more preventive and strategic legal approach.
The key legal protections in off-plan purchases
When advising clients on off-plan investments, we focus on three essential pillars:
1. Bank guarantees for deposits
Your payments must be protected under Spanish law.
Learn more:
https://costaluzlawyers.es/bank-guarantee-spain/
2. Urban planning and licences
Without correct licences, the property may not be legally completed or occupied.
3. Contract control
The private purchase contract must clearly define:
- delivery dates
- penalties for delays
- specifications (calidades)
- refund rights
Madrid is not the exception
Although Madrid is leading the trend, we are seeing similar dynamics in:
- Costa del Sol
- Málaga
- Balearic Islands
In all these markets, off-plan purchases are increasing, especially among international buyers.
Our approach at CostaLuz Lawyers
We do not just check documents.
We structure the transaction to ensure that:
- your money is protected
- the developer is legally compliant
- the contract works in your favour
- your investment is secure from day one
Need expert legal guidance before buying property in Spain?
At CostaLuz Lawyers, our expertise in off-plan property is built on extensive practical experience.
Over the years, we have represented international buyers in complex situations involving delayed developments, missing bank guarantees and recovery of deposits. This experience has shaped our approach: anticipating risk before it becomes a dispute.
You can learn more about our background and experience in off-plan property law here:
https://costaluzlawyers.es/about-us/