The risks of buying at auction (and how to check them)

Which encumbrances can survive the sale?

In an enforcement sale the rule is that registered mortgages and seizures are cancelled, because the proceeds pay the ranked creditors. But some rights follow the property and survive the sale, and that is where the risk sits.

**Easements** (of way, of view, of water) are rights over the land and continue after the sale. A right of way across a plot can materially reduce what you can build on it.

**Usufruct**, if someone holds a lifetime usufruct, you are buying bare ownership: the property without the right to use it. You can only occupy or let it once the usufruct ends.

**Leases predating the seizure** may survive. You buy the property with the tenant, the rent they pay and the term of their contract.

**Pre-emption rights**: a co-owner, a tenant or the municipality may have a statutory right of first refusal. It does not stop you buying, but it can force you to hand the deal over after you have won it.

Where to check: the **permanent land registry certificate** lists everything inscribed. The sale notice states what survives. Where the notice is unclear, treat the ambiguity as a risk rather than as favourable silence.

What if the property is occupied?

This is the most underestimated risk, because it has no number attached. An occupied property can take months to recover and cost thousands in proceedings, and in the meantime it neither earns nor can be worked on.

If the occupier is a **tenant with a valid lease predating the seizure**, the lease may survive. That is not necessarily bad: some investors buy precisely for the rent, but it changes the deal into an income investment rather than a resale.

If the occupier is the **former owner or someone with no title**, recovery goes through the courts. The transfer title gives you the right to possession, but actual possession may require a separate procedure and time.

⚠️ A property described as vacant in the notice may not be vacant on the day of handover. It is worth driving past and looking for signs of life: post, blinds, meters.

Who pays the condominium debts?

The Civil Code answers by when each debt should have been paid: charges that fell due before the transfer are the responsibility of whoever owned the unit then, unless the buyer expressly accepts them in the deed (art. 1424-A(3)). Charges falling due after the transfer are the new owner's (art. 1424-A(4)).

⚠️ That rule was written for voluntary sales with a deed, and an enforcement sale has no deed. How it applies to a judicial sale is not settled, so do not count on a clear answer: ask the condominium administrator for a statement of debt and read what the conditions of sale say about the condominium. On a unit that spent years in enforcement, arrears can run to thousands of euros.

Check also any **approved but unexecuted works**: if the assembly approved a façade job, ask the administrator how much is still to be paid and when it falls due, because instalments falling due after the purchase are the new owner's (art. 1424-A(4)).

Do tax debts transfer to the buyer?

As a rule no: the former owner's property tax and other tax debts are theirs, and in an enforcement sale the tax authority claims in the proceedings. But there are two things to confirm.

First, **the property may be seized for a tax debt**: which is different. That seizure is on the register and its cancellation is part of the sale; confirm on the certificate that it was actually cancelled after registration.

Second, ⛔ **in a TAX execution the conditions can differ from an ordinary enforcement.** Do not assume the regime is the same: read the conditions of that specific sale rather than applying the general rule.

What if the area or the description does not match?

It happens often, and it is a problem that transfers whole to the buyer. The tax record, the registry certificate and the sale notice do not always say the same thing.

An **area discrepancy** between the tax record and the certificate has to be rectified, and rectification is a process with cost and delay.

**Unlicensed building work** (an extension, a basement converted into living space, a pool) may have to be legalised or reversed. The municipality decides, and the application is made by the current owner.

A property **omitted from or not described** in the register has to be regularised before it can be sold or mortgaged. It is doable, but it adds time and fees.

How much do the works you cannot see cost?

You do not know, and that is the honest answer. A judicial-sale property has typically gone years without maintenance, often empty, and you cannot see inside before bidding. Budgeting works optimistically is the most expensive mistake at an auction.

What you can infer from the outside and the photographs: the state of the roof and the window frames, damp on the façades, the age of the building. What you cannot: plumbing, wiring, whether the kitchen and bathrooms are still there.

A prudent rule for an old, empty property is to budget a full interior refurbishment and treat anything better than that as margin. And ⚠️ always add the cost of **standing still**: months of property tax, condominium charges and tied-up capital while the work runs.

What are the risks in the PROCESS itself?

Beyond the property, the judicial process that sells it carries risks: the sale can be challenged, the payment deadline is short and inflexible, and a third party's pre-emption right can take the deal away after you have won.

**Challenge to the sale**: rare, but a judicial sale can be annulled if there is a defect in the proceedings, such as a missing notification or a successful appeal. The risk drops sharply after registration, but it is not zero.

**The payment deadline** is the most concrete risk: in a sealed-bid sale it is 15 days after the offer is accepted (CPC, art. 824(2)). There is no extension because your bank is slow. If the price is not deposited, the enforcement agent may declare the sale without effect and the bidder loses the deposit, among other consequences (art. 825).

**Pre-emption rights**: a co-owner, a tenant or the municipality may hold one. It does not prevent the purchase, but it can require you to hand the deal over on the same terms after you have already won.

**Delays**: credit claims, incidents and appeals stretch the time to issue of title. Your money is committed throughout, and the property earns nothing.

How do you check all this without being a lawyer?

With four public documents and one comparison. None of them requires legal training to read, though knowing what to look for helps.

**Permanent land registry certificate**, what is inscribed against the property: mortgages, seizures, easements, usufructs, the description. The most important of the four.

**Tax record (caderneta predial)**, the property's fiscal record: areas, type, rateable value, year of construction. Use it to cross-check the certificate.

**Sale notice**, the conditions of that specific sale: base value, minimum, deadlines, what survives.

**Condominium debt statement**, when it is a unit in a building.

Then the value comparison. The Licito Report gathers these documents, summarises the encumbrances and pending actions, estimates market value from INE and computes the true total cost, but the sources are public and anyone can consult them.