Changing a premise into a home

Urban plan

Several factors of recent years have driven to find hundreds of empty premises in historical downtowns in cities in Spain.

The rise of the new fashion of Malls to know the Commercial Centers of populated areas and the shortage of building in many towns in Spain, make these premises to be considered as good candidates for future housing.

As said, many of them are in lovely, historical locations in old towns in Spain.

The first step to take if you are looking into this is to know involved legalities:

 Is it possible to convert a premise into a home?

Yes, in most cases, but there are some exceptions so, you need to first consult the Urban Plan of the municipality in which the premises are registered and of course and  Regional and National Law regulating buildings, Community of Owners statutes.

Checkings need to be on:

Local Council Urban Plan Department

  • Classification of the land: verifying is Urban
  • Limitations of dwellings per hectare: if this has already been exceeded, the change would not be possible.
  • Regional and National Building Law:
  • Possible building or technical limitations: the reform needs to meet the Technical Building Code: accessibility, health rules…
  • Habitat standards: set by every Autonomous Community.  It sets the conditions that a home must have to be considered habitable: minimum dimensions, proportions…

Community of owners:

  • There might be some limitations to converting premises into housing. For that reason, we need to review the statute of the community of owners where our business premises are located. Similarly, it is necessary to request the approval of the community of neighbours. Ultimately, a place may become a home as long as it is not prevented by Constitutive Title or affects the common services of the building.

What is the change of use?

In Local planning regulations, the premise Will be classified with a “commercial “use. You need to follow an administrative proceeding to change the use of the property. For this sake, a change of use project needs to be prepared by an architect.  A document in which all the requirements mentioned above are met, as well as those that follow:

  • Approval of the technical project by your City Council.
  • Payment of the municipal taxes and fees involved in applying for a building license.
  • Declaration of cadastral alteration, in order to verify the change from premises to housing.

Once the work is finished you will need to obtain the first occupation license, presenting at the City Council the certificate of completion of the work, as well as the declaration of cadastral alteration.

With all these steps carried out, you will be able to enjoy your new home without legal problems.

Why can’t a place be a home?

Commercial premises cannot be converted into housing without permission. This is because they do not have the necessary conditions of habitability, health and use as a family home.

What are the consequences if I convert a premise into a home without permission?

You will not be able to have your house registered in the Land Registry.

  • The appraisal of the premises is lower than that of a home; therefore your bank will give you problems when applying for a mortgage.
  • If the electricity and water services are not registered within the commercial activity of the premises, then it will be more difficult to do so because for this they will need to do all the legal procedures mentioned in the previous section.
  • The premises could not be rented to use it as a home.
  • The fine can be very large if you have a commercial space that is being used as a private home.

How much does it cost to convert a premises into a home?

It depends on square meters, as well as the kind of reform you need to do.

How much does a lawyer charge for this?

These are usually around € 1,000- €1,500 €

How much a technical project by an architect cost?

Usually between € 1,000 and € 1,500 in price.

How much could the change of a premise into a home could cost in total?

In total, adding a comprehensive reform to the expenses for legal procedures, converting a premise into a home could cost between 20,000 and 30,000 euros.

Buying this kind of property considerably reduces costs. The most advisable thing is to acquire commercial premises that have been previously legalized for their transformation into a home. This will save you significant money, time and problems.

What are the advantages of converting a commercial premises into a home?

  • Financial savings
  • As the most common change in these reforms is the move from commercial premises to loft, another advantage is a greater amount of square meters available to be habitable.
  • Greater natural ventilation, as well as better versatility and freedom of movement.
  • Open spaces of a loft allow more natural light to enter.
  • Allows you to design your house from scratch. Commercial premises are unique corners that can be turned into dream homes.
  • Tranquility: living in a local is not the same as having a flat surrounded by neighbors. The noises are lower, as well as the traffic of the neighbors from top to bottom.

In short, converting a commercial space into a home is an ideal investment to sell, rent or live in.

Some other recommendations when thinking of turning a premise into a loft

Good attention to the location of the premises. Choosing a good area with transport, schools, health services and others is a whole set of reasons that will revalue your business premises if you want to sell it.

  • Hire the services of a professional comprehensive renovation company (we can help you to find a good one in every area of Spain).
  • Never start the work without having all the permits because you could be working and spending your money in vain.
  • Talk to the neighborhood community to avoid complaints or possible problems that delay or disable your reform.
  • Find good financing and do your calculations well. Banks finance around 60% of the appraised value of these properties. 20% below what they usually offer for a home or flat. Ask for several budgets and consult both options within bank financing and financing between individuals.
  • At the end of the work, request your certificate, as well as a municipal inspection that allows you to obtain the first occupation license. Finally, the deed will be carried out in a notary’s office of the change of use from premises to housing.

Get in touch with the expert team at Costaluz Lawyers. We’ll be only too happy to help.

4 thoughts on “Changing a premise into a home”

  1. Viviane Canes Petratos

    Hello , I’ want to purchase a small house located within a small village in the Tremp, Spain area. The house is 14 square meters but has 3 floors so wud actually sum up to 42 square meters . It is listed in the deed as an “ almacen” . My question is can I possibly convert it to a “ vivienda” ? The owner is only asking f€8000 for it .

    1. Maria Luisa Castro

      Dear Viviane:

      To convert a property listed as an “almacén” to a “vivienda” in Tremp, Spain, you must check (1) local zoning laws, (2) obtain planning permission, and (3) secure building permits from the local town hall. This process involves ensuring the property meets residential standards for health, safety, and habitability.

      Post-conversion, a change of use registration is required at the local land registry. Given the complexity, consulting with a local architect and a lawyer specialized in Spanish property law is advisable. Costs for planning, permits, construction, and professional fees will add to the initial purchase price.

      We will be pleased to assist you with that if necessary.

      Best regards,

      Maria

  2. Hello, We have a problem with our Local being used for residential purposes.
    We are sure this isn’t legal.
    Can you clarify this and what is the approximate difference in costs for running a Local compared to a residential premises.

    Thank you

    1. Maria Luisa Castro

      Is Using a Commercial Property for Residential Purposes Legal in Spain?

      Using a commercial property (“Local”) for residential purposes in Spain typically requires a change of use permit from the local municipality. Without proper authorization, this use is generally illegal and can lead to fines.

      Cost Differences

      Commercial vs. Residential Costs:

      Property Taxes (IBI): Higher for commercial.
      Utility Rates: Higher for commercial.
      Maintenance Fees: Higher for commercial.
      Insurance: Higher for commercial.
      Additional Costs: Business licenses and other fees for commercial properties.
      How We Can Help

      We provide:

      Legal Assessment: Verify requirements and obtain necessary permits.
      Cost Analysis: Compare costs between commercial and residential use.
      Guidance and Support: Assist throughout the entire process.
      Hope the above helps

      María

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