TECHNICAL BUILDING EVALUATION REPORT (IETE) AND CONTRACTUAL TERMINATION

We must acknowledge that this article has been inspired by a recent case at our real estate law firm in Alicante. In this case, the buyer, after signing the earnest money agreement and before the notarization deadline, attempted to claim unjust compensation, in our opinion, arguing that they had not been informed that the building was over 50 years old and lacked the technical evaluation report required by the Valencian Government.

The buyer, in our judgment acting in bad faith, did not demand compliance with the obligation—something natural—but sought damages under the pretense of hidden defects that were already known, insinuating deception in the transaction.

Although the specifics of this case suggest either poor advice or deliberate bad faith on the part of the buyer, it prompted us to write this article. After many years in real estate law in Alicante, this scenario had never arisen before.

THE TECHNICAL BUILDING EVALUATION REPORT – A LEGAL REQUIREMENT

The requirement for buildings over 50 years old to have this report is established in the Valencian Community by Decree 53/2018, dated April 27, which regulates the evaluation report for residential buildings.

According to Article 3, the formal obligation to obtain and bear the cost of the IEEV.CV report falls on the owners of the property, whether individuals or legal entities. For buildings under horizontal property ownership, the community of owners is responsible: “When the residential building is over 50 years old, the construction date recorded in the cadastral information shall be used unless documentary evidence states otherwise.”

Article 5 establishes that the IEEV.CV will be valid for 10 years from the date of telematic submission to the relevant registry. Property owners must submit a new IEEV.CV before the expiration of this period. Additionally, the report must be included in the building’s book as per the provisions of Decree 25/2011, dated March 18.

Furthermore, the consolidated text of the Law on Territorial Planning, Urban Development, and Landscape (Decree-Law 1/2021, dated June 18) establishes in Article 189:

1. Property owners must maintain their buildings in safe, functional, and habitable conditions, carrying out necessary work to preserve these conditions or to obtain administrative occupation authorization or equivalent documentation for their intended use.
2. Property owners of residential buildings over 50 years old must, at least every 10 years, promote a technical inspection conducted by a qualified professional to evaluate the building’s condition.

We can also mention the recent Law 12/2023, dated May 24, which explicitly regulates housing-related norms. Article 9 highlights the obligations of property owners. In buildings over 50 years old, failure to comply with the requirement to produce this report clearly constitutes non-compliance.

BUYER RIGHTS

Among the rights of buyers concerning the condition of the property, we refer to Article 31.1 of the Law 12/2023, dated May 24, cited earlier. This law specifies the buyer’s right to request information about various aspects of the property, including:

1. c) Essential characteristics of the property and the building, including:

3.º The building’s age and, where applicable, major renovations or works performed.

CONSEQUENCES OF NOT HAVING THE TECHNICAL BUILDING EVALUATION REPORT (IETE)

VIOLATION OF THIS REQUIREMENT

According to Article 7 of Decree 53/2018, property owners who fail to obtain the IEEV.CV report, despite being legally required to do so, commit a planning violation subject to penalties under urban legislation.

As per Article 284.2 of Decree-Law 1/2021, property owners failing to conduct the periodic inspections required by law can face fines ranging from €600 to €6,000.

SELLER’S OBLIGATION TO PROVIDE THIS REPORT

Sellers are obligated to inform buyers about the absence of this report. Failure to do so can lead to future issues for the buyer. However, administratively or legally, this does not entitle the buyer to claim damages beyond resolving the earnest money agreement or the sales contract itself.

Our professional experience shows that many individuals are unaware of this requirement. Therefore, the best approach is to remedy the situation by producing the report, which is relatively straightforward to obtain.

CONSEQUENCES OF NOT HAVING THE IETE REPORT IN PROPERTY PURCHASES

Failure to provide this report before the purchase grants the buyer the right to terminate the sales or earnest money agreement. However, this does not entitle the buyer to claim compensation beyond the return of the earnest money.

REAL ESTATE LAWYER IN ALICANTE

At Carlos Baño Lawyers, we specialize in real estate law and horizontal property. If you need advice on drafting statutes, interpreting regulations, or resolving conflicts related to vacation rentals, we are here to help.

Contact us through our website or visit our offices in Alicante. Our team of professionals will provide you with personalized and effective solutions.

You can also find us on Google Maps.