From costs to documentation, projects, and taxation, this is a complex process. We have summarized the key points for a successful operation.
Buying land to build a house is a complex process, with costs involved in the purchase, project design, construction, as well as taxes and related fees. To ensure that the purchase of land is a successful decision, in this article we summarize some aspects that can help in this decision.
Before signing a preliminary purchase agreement, you should ask the seller for documents relating to the property, such as the updated land registry certificate and property record book, to find out if the land has any encumbrances or charges that could prevent or hinder your decision to proceed with the purchase of the property.
If the land is intended for construction, you should also consult the PDM - Municipal Master Plan at the City Council of the area where it is located. In the PDM you will find:
- The regulations, which establish the rules that apply to the use, transformation, and occupation of the land, which are binding on public and private entities;
- The zoning plan, which shows the organization of space within the municipal territory;
- The constraints map, which identifies administrative easement areas and any public utility restrictions that may limit or prevent the use of the land for other purposes in any specific way.
Consulting these documents will allow you to find out whether it is possible to build on the land you wish to purchase and what constraints may apply.
Ideally, the land should already be located in an area with building permission and basic infrastructure, such as sanitation and power lines, should be easily accessible.
In addition to consulting the PDM, for land not included in subdivisions, it is necessary to submit a licensing project to the city council. This is a basic architectural project for a new construction. After this licensing project has been approved, it will also be necessary to apply for a building permit and, later, a housing license.
For land already included in subdivisions, it is also important to consult the latest version of the approved subdivision permit and any detailed plans that may exist and govern construction on that land. This characterization requires consultation with the local authority. It is from this plan that the characteristics of the possible construction (implantation polygon, areas, number of floors, basements, wall height, etc.) result.
Finally, you should check the Municipal Regulations on Fees Related to Urban Development and Related Operations for all information on applicable fees and any exemptions and reductions available.
There are two types of fees to which the licensing process will be subject, namely:
- Urban Development Fees
- Urban Compensation Fee
Finally, it is important to note that, in addition to the fees applicable at the municipal level in the licensing process, the purchase of land for construction is also subject to the payment of IMT (Municipal Transfer Tax) and IMI (Municipal Property Tax) at the time of purchase.
Source: idealistanews