Coastal Law reform leads to foreign buyer frenzy
Foreign buyers are finding themselves in a frenzy when it comes to Spanish property, following reforms to the Coastal Law. Experts have reported the changes are already having an impact, particularly on prices, which have been in freefall since the financial crisis hit. In fact, Juan Fernández-Aceytuno, head of the Sociedad de Tasación appraisal company, revealed to the Spanish press the value of coastal property is now rising.
Previously the Coastal Law, introduced in 1988, nationalised the entire Spanish coast. It was designed to protect the coast, but instead prevented important development by restricting private ownership. Everything that fell inside the surf zone and beach, an area where the sea waves reach or have reached, all areas where there is sand, shale or pebbles, and all areas reclaimed by the sea belonged to the 'public domain'. This meant those with property in this zone lost their ownership rights.
Owners of homes in the public domain where given a 30-year concession before the law came into force. This was a form of lease due to expire in 2018. However, the reforms have extended the concession to 75 years, making it legal buy and sell. Owners of property in coastal areas can now begin refurbishment, while longer leases are now possible. This creates important investment opportunities for the area.
Mark Stucklin of Spanish property Insight said: "This troublesome piece of legislation expropriated private property without compensation, whilst spectacularly failing to achieve its stated objective of protecting the coast for the public good." Now the reforms have extended the concession they are now "much more valuable". "Some could have increased in value by hundreds of thousands of euros," Mr Stucklin explained.
However, some regional governments plan to challenge the ruling in court, including Andalucia, Asturias, the Canaries, Catalonia and the Banque Country. This is despite EU support of the reforms. In a statement vice-president Viviane Reding, the EU's justice commissioner, welcomed the changes, claiming the Coastal Law in its previous form breached citizen's rights.
Previously the Coastal Law, introduced in 1988, nationalised the entire Spanish coast. It was designed to protect the coast, but instead prevented important development by restricting private ownership. Everything that fell inside the surf zone and beach, an area where the sea waves reach or have reached, all areas where there is sand, shale or pebbles, and all areas reclaimed by the sea belonged to the 'public domain'. This meant those with property in this zone lost their ownership rights.
Owners of homes in the public domain where given a 30-year concession before the law came into force. This was a form of lease due to expire in 2018. However, the reforms have extended the concession to 75 years, making it legal buy and sell. Owners of property in coastal areas can now begin refurbishment, while longer leases are now possible. This creates important investment opportunities for the area.
Mark Stucklin of Spanish property Insight said: "This troublesome piece of legislation expropriated private property without compensation, whilst spectacularly failing to achieve its stated objective of protecting the coast for the public good." Now the reforms have extended the concession they are now "much more valuable". "Some could have increased in value by hundreds of thousands of euros," Mr Stucklin explained.
However, some regional governments plan to challenge the ruling in court, including Andalucia, Asturias, the Canaries, Catalonia and the Banque Country. This is despite EU support of the reforms. In a statement vice-president Viviane Reding, the EU's justice commissioner, welcomed the changes, claiming the Coastal Law in its previous form breached citizen's rights.
PUBLISHED : 11TH JULY 2013
