The regional government approves a line of guarantees worth 50 million euros. Those buying a home off-plan will not have to advance up to 10% of the price during construction.
According to epe.es, the Community of Madrid approved on Wednesday a new line of guarantees worth 50 million euros to facilitate the purchase of new homes. With this measure, those acquiring a home off-plan will not have to pay up to 10% of its price during construction, a payment that was previously made to developers or cooperatives before receiving the keys.
The example provided is of a home worth €300,000, where the buyer could avoid advancing up to €30,000 during the construction. This amount does not disappear; it is postponed and must be paid later. Other payments prior to delivery are not covered by the system.
The mechanism will be structured through reciprocal guarantee societies (SGR), which will be able to guarantee developers and cooperatives. The Community will cover up to 70% of each guarantee at no cost, and the guaranteeing entities will assume at least the remaining 30%. The system will be available for both protected homes and freely priced properties.
The measure could be applied in urban developments in Madrid such as Valdecarros, Los Berrocales, Los Ahijones, or Los Cerros, as long as the developers adhere to the new system. The guarantees are not granted directly to buyers, although they benefit from not having to advance part of the price.
The regional government has not yet detailed whether there will be age or income limits, nor a maximum price for the home. It has also not clarified whether those who already have a signed off-plan contract can benefit. Once the construction is completed, buyers who take on the developer's mortgage loan can apply for inclusion in My First Home, the regional loan program.
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