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| Discover why you should never give your deposit di |
A local lady came to us to sell her 15 year old house, and we quickly found an English buyer, who put down a deposit.
When we started checking the paperwork on the house, we found that the building license was for a 50 square metres structure. We always check the paperwork against the true size, and when the result of the topographic survey came back, it showed that the building was 75 square metres. 25 square metres of it was illegal. We told the client, and he decided to look for another house rather than run the risk of buying a building he might have to pay a fine on, or watch being demolished one day.
Under the system that has been used up to now, the deposit would have gone straight to the owner, and our buyer, in backing out of the sale, would have had trouble getting his money back - even though he was not to blame.
But under the system we have introduced, the deposit has been placed in a trust fund, and we were able to return it to our client.
Before we introduced our system, owners were used to receiving their deposits right away, and they complained. But to safeguard our clients we insist on checking the paperwork first for potential problems. Having learnt that our active marketing means that their property will sell quickly, the owners have had to accept our policy, otherwise we won’t take it on.
In another case in the same village, a house had a small illegal section. This time the client bought knowingly, aware that one day she would have to legalize it, or demolish.
Then there was the concrete skeleton in Kavadades. It was for sale at a very good price, and we had a buyer quickly putting down a deposit. But on closer inspection we found the land it was built on was not the 2,100 square metres it stated on the building approval, but only 1,900 square metres. In this area, at least 2,000 square metres is required to build, so to get the approval the owner had ‘stretched’ it, and managed to fool the town planning office. The buyer pulled out of the sale, and because his deposit had been placed in a trust fund, he got it back.
The problem of illegal buildings exists because many of the locals don’t obtain a proper license, thinking that they can get away with it. Maybe their land does not qualify for building, so they ‘stretch’ it, or invent other tricks. If all the ‘stretched’ topographic drawings were joined together, Corfu would be a third larger in size than in reality. This problem will intensify when the laws are changed, and a minimum of 4000 square metres will be needed to build. Many people will be left with plots too small for building, and will be tempted to ‘stretch’ them. So beware of the stretchmarks.
Under our system, we check all the paperwork and report the findings so the client can make an informed decision about whether to buy or leave it. Of course if they buy an illegal property they may never get into trouble, but there is always the possibility they could fall out with a neighbour, with the risk that they might be reported to the authorities.
Another consideration with illegal extensions is that they have not been designed by a civil engineer, or checked for structural integrity.
Sometimes a whole building is illegal. Someone once called me from England asking me to oversee a private sale. The two bedroom house was on a large plot near the sea, and as it was a bargain at 22,000 pounds, the buyer did not want to lose it. The owner was pressing him to hand over a deposit, and he was determined to go ahead. I talked him out of it, saying that the paperwork should be checked out first. Then the owner said he would not hand over the paperwork until he had the deposit, but I insisted. Finally he came up with the goods, and we discovered just what I had feared - the whole property was built illegally. The plot only covered 1,500 square metres in a zone where 2,000 square metres is needed to build. There were no permits, and no engineer had overseen the work. One day, a demolition order could be placed on it.
The buyer was very grateful that I had advised him not to pay the deposit. Unfortunately he did not pay the solicitor’s fees for the check, and I had to pay the 150 euros.
Because of situations like the ones we’ve described above, the reputation of the property market in Greece does not sparkle. In order to combat this image, Luvcorfu Properties has been trying to change the procedures that have always been used Greece-wide, basing them more on the Australian system than the UK one (which has its own problems, like gazumping). It won’t be much longer before the secrets of the past are laid to rest.
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