When you build your own house you can customize it to your liking and save the profit that a developer would make, as you are the developer yourself.
Therefore, you can expect savings between 30% and 40% compared to the market price of a ready-made house.
If you buy a second-hand house, it is almost certain that you will want to make renovations afterward (usually the bathrooms and kitchen, at least); that’s what usually happens.
From our perspective, the only advantage of buying a ready-made house (unless you find a bargain like a house from a foreclosure, for example) is that you can move in the day after buying it.
However, if you build your own house, you will have to wait for it to be constructed (between obtaining permits and completing the construction, it can take 12 to 15 months, often more).
Furthermore, if you buy a ready-made house, you expose yourself to the possibility that the house may have some hidden construction defects that are not immediately apparent because the seller probably took steps to conceal them (known as hidden defects), such as cracks, dampness, tile detachment, electrical faults, plumbing blockages, and others. However, if you build it yourself, you avoid that risk.
Architect fees are not fixed; there is no official scale, only indicative scales calculated by the Official Architects Association of each region.
It can even happen that the same architect wants to charge more or less depending on the workload they have, meaning that if they are lacking projects at a certain time, they may lower their fees.
Furthermore, the fees depend on the size of the house, the level of quality, the complexity of the project, and in many cases, the payment terms.
For example, we offer a significant discount to clients who choose to pay our fees in a lump sum at the beginning of the project (early payment discount), and who allow us to place our advertising sign on the plot during the construction period. This benefits us in attracting future clients in the area.
However, we believe that the typical market fees for an architect generally amount to around 5% of the project budget, which is a similar amount to the cost of the building permit. In other words, an architect usually charges for their work approximately the same amount that the client will pay to the municipality.
But I must emphasize that this is only indicative.
In our case, for single-family homes with a budget over 180,000 euros, we always charge less than the municipality. It’s a “house rule.”
We don’t want to lose a client, who will likely bring us more clients in the future, just because of the price.
Word of mouth is crucial for us; we rely on it.
Therefore, within reason, we always strive to reach a sensible agreement on this matter.
The Municipality (slightly varies depending on each municipality) charges 2% of the Construction Execution Budget (PEM) for license fees and 3.5% of the PEM for construction tax (ICIO). In total, it amounts to 5.5% of the PEM.
What is the PEM? It stands for the Construction Execution Budget (Presupuesto de Ejecución Material, P.E.M.).
The PEM is calculated based on the size of the house and values published annually by the Official College of Architects in each area, which represent the statistical average of construction prices in the area.
To save you money, we always try to declare the lowest possible budget (PEM) in the project. We have a “trick” (which is legal) that involves stating that the project will be built with basic specifications (similar to a subsidized housing unit).
This allows us to reduce the PEM by 20%, resulting in a saving of around 1,000 euros for the license.
Real Example: PEM of 200,000 euros.
License Fees 2%: 4,000 euros
ICIO 3.5%: 7,000 euros
Total Municipality Fees: 11,000 euros
If we lower the PEM by 20%… PEM of 160,000 euros
License Fees 2%: 3,200 euros
ICIO 3.5%: 5,600 euros
Total Municipality Fees: 8,800 euros
11,000 – 8,800 = savings of 2,200 euros.
This “trick” sometimes works, and sometimes it doesn’t, but we always give it a try in every project because we have nothing to lose.
If the Municipality does not accept our PEM, there are no fines or penalties. They will simply calculate their version of the PEM, and you will pay the license fee based on their calculated PEM.
First, you will pay 2% of the PEM for the license fees. Then, once the construction has commenced, you will receive a payment notice to pay 3.5% of the PEM for the ICIO.2
Yes, there are several additional expenses.
GUARANTEE FOR SIDEWALK RESTORATION: This usually ranges between 1,500 and 2,000 euros (varies depending on the length of the sidewalk adjacent to your property; corner lots or those with extensive frontage may incur higher costs). This amount is refunded to you after inspection by the municipality.
GUARANTEE FOR CONSTRUCTION WASTE MANAGEMENT: This guarantee is for the proper disposal of construction debris. The cost varies based on the size and budget of the project, but typically ranges between 2,000 and 3,000 euros. Nowadays, it is mandatory to dispose of construction waste at controlled landfills, where each type of material receives the appropriate treatment or recycling (inert materials, metals, wood, plastics, hazardous and polluting materials, etc.). The guarantee will be returned to you upon presenting a certificate from the controlled landfill to the municipality.
PROVISIONAL WATER CONTRACT: Once you have obtained the license, you will need to contract a temporary water meter for construction purposes. After completing the construction, this meter will be converted into a permanent one by providing the company (such as Aqualia, Hidralia, etc.) with the Certificate of First Occupancy.
PROVISIONAL ELECTRICITY CONTRACT: Similar to the water meter, you will need a temporary electricity connection for the construction period.
These additional expenses are important to consider in your overall budget for the construction project. It’s recommended to discuss these details with your architect and relevant authorities to ensure compliance and proper planning.
It is a very important document, let me summarize it for you:
When you buy the plot of land, you only have the plot of land, obviously.
When you obtain the building permit, you can start the construction, but you don’t have a house yet: you have a building that is not yet suitable for habitation.
Once the construction is completed, the architect and the building surveyor provide you with a FINAL CERTIFICATE OF COMPLETION, which certifies that the house has been finished, complies with all the necessary requirements, and conforms to the approved project.
Then, you apply to the municipality for the CERTIFICATE OF FIRST OCCUPANCY (also known as the Habitation Certificate).
The municipality sends a municipal technician to inspect the house and verify that everything is in order.
If everything is okay, they grant you the Occupancy License and return the previously mentioned guarantees (sidewalk guarantee and construction waste guarantee).
If they raise any issues, you must address and resolve those issues. It is advisable to avoid any issues during the inspection.
Only when you have the Certificate of First Occupancy will your house legally be considered a dwelling. Before that, it is only a construction that is not suitable for habitation.
Only after obtaining the Certificate of First Occupancy can you arrange for the permanent utility connections (water, electricity, gas, etc.).
That’s why it is so important.
YES. You have to hire a BUILDING SURVEYOR, who typically costs about one-third of what you pay the architect.
You also need to hire a land surveyor (usually costs around 300 euros, generally) to accurately measure your plot in UTM coordinates (Universal Transverse Mercator coordinates obtained through GPS, to put it simply). We require a topographic plan from you to start the design process, so it’s one of the first things you need to arrange.
You may also need to hire a geotechnical study (usually costs around 700 euros), which is a company that analyzes the soil to accurately calculate the foundation of the house and prevent issues such as cracks after construction.
We often save our clients the expense of a geotechnical study based on three reasons:
We may already be familiar with the land if we have built a house nearby.
We can try to obtain the geotechnical study from a nearby neighbor whose land is likely similar to yours. If they allow us to review or make copies of it, then you don’t need to hire a geotechnical study for your plot, saving you that expense.
We usually solve the foundation through a reinforced concrete raft slab, which ensures the stability of the house and provides a solidity similar to that of a ship’s hull.
Lastly, if you think you will want to sell the property within ten years of its completion, you can consider purchasing a Ten-Year Insurance policy. If you decide not to purchase it and later decide to sell the property, you can do so (informing the buyer that you don’t have the ten-year insurance), and you can also purchase the ten-year insurance after the completion of the house.
Good question. The answer is that the Law (Building Regulations Law, L.O.E) requires it.
We like to explain it with this example: When you hire a lawyer for a lawsuit, you are also obligated to hire a solicitor, who acts as the lawyer’s “assistant.”
When you undergo surgery in a hospital, in addition to the surgeon, there are other professionals involved such as the anesthesiologist, nurse, orderly, etc., who assist the surgeon.
Similarly, when it comes to construction, you must hire both a senior architect and a technical architect (aparejador).
The aparejador is responsible for the development and material execution, essentially overseeing the day-to-day aspects of the construction project.
The architect handles the general supervision.
The aparejador takes care of the details, the specific aspects of the construction project, and the occupational safety.
When there is a problem or question on the construction site that goes beyond the aparejador’s expertise, they will notify the architect to resolve it.
In colloquial terms, without diminishing the importance of the role of the aparejador, you can think of the aparejador as the architect’s on-site assistant, just as the solicitor is to the lawyer or the anesthesiologist or nurse is to the surgeon.
We believe we are very efficient.
If the client has a clear idea of the house they want, we can generally take a couple of weeks to have the basic project ready to be submitted to the Town Hall.
Once the basic project is submitted, the Town Hall may take about three months (often longer) to grant the license.
After obtaining this license, we prepare the Execution Project, which usually takes us another two weeks approximately.
We submit this second project (Execution) to the Town Hall, and typically, a month later (often longer), the Town Hall grants us the AUTHORIZATION TO BEGIN CONSTRUCTION.
That is when we can start the construction works.
A project must comply with numerous laws and regulations (which often have different interpretations depending on the municipal technician reviewing the project), and the municipality often raises some objections to the initially submitted project.
Sometimes these objections are easy to resolve (change the fence of the plot to a different model, add or modify certain plans, make a window larger, etc.). Other times, the objections require more significant changes to the project.
To avoid having to repeat all the plans, calculations, and other project documents, a simplified version of the project, called the Basic Project, is initially submitted.
The Basic Project, aptly named, is a “reduced” version of the project that includes the necessary plans, elevations, sections, surface tables, and other documents for the municipality to review, identify any objections (which is their function in controlling projects), and ultimately grant the license.
However, the Basic Project does not yet include foundation plans, structure plans, electrical plans, plumbing plans, carpentry plans, and other more detailed and costly documents that architects do not wish to repeat unnecessarily due to objections from the municipality.
Therefore, the process is as follows:
1. We submit the Basic Project.
2. The municipality raises any objections, if applicable.
3. We address and resolve the objections in the Basic Project.
4. The municipality grants us the license.
5. Once we have written confirmation that the municipality has approved the Basic Project, we proceed to prepare the Execution Project, which includes all the necessary calculations, detailed plans, reports, and other documentation required for construction.
For this reason, we first submit the Basic Project, and only proceed with the Execution Project once we have obtained official approval of the Basic Project from the municipality.
Unfortunately, licenses are not immediate. They always take longer than one would like.
For minor works (renovations), they can be obtained immediately through the legal procedure known as “DECLARACIÓN RESPONSABLE” (Responsible Declaration).
However, for major works (extensions or new construction), the process is slower.
The time it takes to obtain a license for major works can vary depending on the municipality. Some municipalities take longer, while others are faster.
It also depends on other factors. For example, we have noticed that if we submit the project in December, it will likely take longer due to the Christmas holidays. The same applies to July and August. They may not review it until September.
As a rough estimate, you can consider yourself lucky if it takes six months from the submission of the project until you can start the construction.
Once again, this depends on many factors, primarily the construction company that carries out the work.
Many builders find it difficult to turn down new construction contracts even if their schedule is already full. They also have to consider the possibility of future uncertainties, such as interruptions, postponements, or cancellations of existing contracts for various reasons.
As a result, builders often take on more projects than they can handle at a normal pace. They distribute their resources (workers, machinery) among different projects, trying their best to satisfy all clients and keep the projects moving forward while minimizing any potential delays caused by the excessive workload.
Therefore, it is common for the construction company to take longer than initially agreed upon. A one-month delay is generally considered acceptable, as a 10% delay is typically manageable.
However, if the delay extends to, for example, six months, it should not be tolerated. In such cases, a contract clause known as a “penalty clause for unjustified delays” can be included, which imposes a fine for each day of delay. For instance, the fine could be set at 100 or 200 euros per day.
Other circumstances beyond the construction company’s control, such as strikes, pandemics, natural disasters, or seasonal restrictions imposed by certain tourist municipalities, can also cause delays in the construction process.
A construction project inevitably causes inconvenience to neighbors (noise, dust, traffic congestion…), and that is why municipalities want construction to be carried out as quickly as possible to minimize the disturbances it may cause.
In some sensitive areas (near a school, hospital, or monument), the municipality may impose additional restrictions. In high-density tourist areas, you may be required to stop construction during July and August.
In small towns, there is a common practice of building houses gradually as one can afford. Therefore, in these municipalities, there is usually more flexibility regarding the construction timeline.
On the other hand, larger municipalities are stricter when it comes to meeting deadlines. They want the construction to be completed as quickly as possible, and therefore, the building permit grants a specific timeframe (usually between 12 and 18 months) that should be adhered to.
However, if you are unable to meet the granted timeframe and need more time, you have the right to request an extension of the building permit for a similar duration to the initial grant. For example, if you were given one year initially, you can take up to two years to complete the construction.
Multiple extensions cannot be requested, only one.
In case of force majeure, the deadlines are automatically extended for the duration of the force majeure event (such as COVID lockdowns or inaccessibility to the site due to reasons like floods, earthquakes, landslides, etc.).
It is very common for clients to want to make some changes during the construction process.
In this regard, it should be clarified that changes can be divided into two different categories:
Non-substantial changes: These are minor changes that do not affect the fundamental parameters of the permit. For example, changing the color of the facade, the kitchen tiles, slightly moving a door, or relocating a window… things of that nature. These changes can be made without any problem.
Substantial changes: These are changes that do alter the fundamental parameters of the house. For example, making the house larger, roofing a pergola, changing the interior layout of the house, etc.
These substantial changes cannot be made on the spot because you will not be granted the Certificate of Occupancy. You could even be fined (disciplinary proceedings), or in the worst case, be required to demolish what has been built without a permit.
To be able to make substantial changes once the permit has been granted, you would have to stop the construction, submit a new project, and wait for it to be approved.
Therefore, it is never a good idea to make substantial changes during the construction process. It is advisable to carefully plan the project before submitting it to the municipality.
You cannot do whatever you want on your plot of land. The right to property is separate from the right to build. Therefore, regulations establish parameters for your plot that you must not exceed.
For example, if your plot is authorized for two floors and a maximum of 200 square meters, you cannot build a three-story house with 300 square meters.
When we create a project, clients often request that we maximize the allowed size, meaning we exhaust the building capacity of the plot. In this case, the house cannot be expanded in the future unless there are changes to the municipal regulations (which is uncommon).
Once the building capacity of the plot has been exhausted, any further expansion would be illegal and cannot be legalized unless through a period of prescription (typically 6 years). Therefore, we strongly advise against such illegal works.
Since this is a complex and extensive topic, we can provide a more detailed explanation when we meet.
It is essential to choose the right builder as it is a crucial decision. Here are several recommendations regarding this:
1. They should have a good reputation in the area.
2. They should have experience in constructing houses in the same locality.
3. Seek references from previous clients of the builder who can provide positive feedback.
4. Ensure they have the necessary team and equipment to carry out the construction.
5. Request a detailed and itemized budget that clearly specifies what is included and what is not.
6. Beware of excessively low budgets, as quality work cannot be achieved at significantly reduced costs.
7. They should be willing to show you recent or ongoing projects they have completed.
8. They should be willing to commit in writing to meet the agreed-upon timeline.
9. They should comply with safety and health regulations at the construction site.
10. All their workers should be insured and up-to-date with workplace safety training.
11. Agree on a reasonable and progressive payment plan tied to the progress of the construction. It is advisable not to pay a significant amount upfront.
12. It is preferable for the builder to personally guarantee the construction contract by acting as a co-signer, so that, in case of any legal disputes, you can pursue claims against both their personal assets and the company’s assets.
13. Inquire about which parts of the project they plan to subcontract, in which case they should take responsibility for the subcontracted work.
If desired, we can assist you in selecting the builder. With over two decades of experience working with builders, we have acquired the ability to identify whether they possess the desired qualities. We ask them questions about construction details, such as how they handle certain aspects like waterproofing, adhesive mortars for exterior tiles, materials used for specific tasks, and their familiarity with necessary products for different parts of the construction. We even have some “trap” questions that can help determine if they are straightforward or not. This can be highly useful when the time comes.
There is an important concept, even with legal validity, called “the standards of good construction.” It mainly refers to the level of finishing in the construction. For example, vertical and perfectly perpendicular walls, level floors, uniform dimensions of stair steps, even and properly grouted tiling, smooth and without patches or protrusions plaster finishes, straight corners with edge protectors, correctly installed baseboards, well-fitting doors and windows, properly placed door and window casings, and more.
As architects, it is our responsibility, along with the site supervisor, to ensure that the builder adheres to these standards of good construction throughout the project.
Over the years, we have learned a little trick to keep the builder under control. It involves signing an initial construction contract that only covers the early phases of the project, such as site preparation, foundation, and structure. The rest of the work is left for a subsequent contract.
This approach motivates the builder to fulfill their commitments correctly, as otherwise, you could decide not to hire them for the remaining construction. If the builder does not accept this arrangement, it may raise suspicions about their intentions.
If this happens, it is a problem, and every effort should be made to avoid it within reason.
That’s why it’s crucial to choose a builder who inspires confidence and offers guarantees.
If the breaches (in terms of deadlines, prices, quality of work, etc.) are minor, we recommend, within reason, trying to be understanding and patient. Give the builder an opportunity to provide their perspective (there may be an explanation for the situation) and negotiate a mutually agreeable solution. The alternative is to dismiss them, which should be avoided if possible.
In such cases, we mediate between the builder and the homeowner to reach a reasonable agreement for both parties. We refer to the contract and regulations and make it clear that the builder must adhere to what was agreed upon to prevent further issues.
Builders are aware that as architects, we can recommend them for future projects, so they usually take our advice seriously.
If, on the other hand, the breaches are so significant that they cannot be tolerated, and the relationship is irreparably damaged, then it may be necessary to consider terminating the contract due to the builder’s fault. In such cases, we would intervene as witnesses (providing photographs of defects, etc.) if the conflict were to escalate into a legal dispute.
However, rest assured that it is rare to reach such an extreme situation (we have only encountered it about five times in twenty years, on average once every four years). This is mainly because the builder, in those cases, knows they are likely to lose and tends to comply with our reasoning. It’s our job.
To avoid issues during the construction process, it is advisable to avoid accepting bids with excessively low prices. A builder submits a bid with a low price when it is significantly lower than other bids you have obtained and the prevailing market prices.
Such a low bid can have various explanations: the builder may not have thoroughly studied the project, may lack sufficient experience in that type of construction, or may intend to secure the contract at a much lower price than the market prices in order to recoup their profit during the course of the project (e.g., by using lower-quality materials or demanding additional payments during the construction).
To avoid issues during the construction process, it is advisable to avoid the so-called “baja temeraria”. A builder submits “baja temeraria” when his quotation is SIGNIFICANTLY lower than the other bids you may have obtained from all the other candidates.