Country estates part I: which economic opportunities do they offer?

1. Rural properties: concept and uses

In this entry we talk about a new topic: rural estates.The National Statistics Institute defines as: 'real estate properties that belong to the countryside or the rural world'.

It is a poor conceptualization because it fails to make explicit that this type of property can include woods, but it does have one great advantage: it defines precisely the geographic scope of these properties. 

The main uses of rural properties are the following:

- Agricultural

- Livestock

- Forestry

- Hunting, fishing or tourism

- Nature conservation  

2. What are the main characteristics of the rustic farms?

Dimensions: its extension in Spain is currently from a few hectares to 18,000, an extension that is equivalent to 0.58% of Catalonia.

Buildings inside the estate: As an owner, can I build a house for my own use and enjoyment on land classified as rustic? No, in Catalonia you cannot build  on rural land. This principle has an exception: if the building is unequivocally dedicated only to the work in the countryside it can be built. 

As a conclusion to this section, click on this link to access the Generalitat's answers to frequently asked questions about rural properties.

3. Explanation of each rural properties type:

- Agricultural: Devoted to the production of crops (cereals, fruits, vegetables, etc.).

The ' Farmer Calendar' compiles the tasks in the garden for each of the twelve months. In this way, we quote the "Calendar of the works planned for the coming November:

"We will sow baits we will transplant spring brambles, collect bees, barley, Brussel sprouts, saffron, cardoons, broccoli, grasses, tomatoes, bitxos. It is necessary to keep the garden clear of the first plants that fall".

- Look after livestock: cows, sheep, horses, etc.

- Forestry: Focused on sustainable forest management. It is worth detailing the specific management tasks to be carried out:

- Extinguish forest resources

- To carry out the stubble burning: you must always communicate it to the Generalitat and ask for authorization. In this link you can do both procedures.

We recommend the utmost caution and common sense: in high temperatures or strong winds desist from this activity and, in any case, you must always be aware of the levels of danger that the administration decrees in relation to these two climatological factors. 

- Clearing of combustible organic matter from the soil and controlled tree felling: Everything that can be used as fuel must be removed from the forest.

How? By clearing the forest roads from: bad grass, branches, dead trunks or trunks and other physical obstacles, we can finally make such controlled felling. It is beyond our individual reach that the electric companies maintain in good conditions the high tension lines in the forest and, periodically, supervise their condition.

If we do all this on a constant basis: firstly, the risk of fire will decrease. Secondly, when the fire occurs, uncontrolled expansion will be more difficult and, thirdly and lastly, extinction tasks will be more feasible.

- Environmental conservation: Natural reserves where ecosystems and biodiversity are preserved. With this objective, it is important to remember that the Administration can totally or partially buy farms or declare them of public utility and expropriate them, although it must only be in the explicit cases foreseen by law and always with a fair economic compensation. 

 - Recreational: We must not forget that leisure, whether private or open to the public, can be a very profitable and, at the same time, sustainable activity.

4. A rural property, however small it may be, requires intense maintenance

The rustic property is yours, as such, it demands an intensive maintenance. This involves planning and carrying out work (most likely you will have to hire workers to do it).

It is no secret that having a farm involves high costs, but the benefit will be even greater from all points of view (environmental, improved economic performance, preservation of the farm, etc.). 

In order to carry out this conservation task, it is necessary to have several circumstances under control:

• Pests
• Tear of materials and infrastructures (eventually it will be necessary to renew them).
• The temptation not to manage the forest
• An improbable waste in the sowing and harvesting of crops or in the breeding of livestock.
• The problem of watering -and contamination- by animal excrements (purines)
• The inertia of not adapting to the increasing droughts and, more specifically, the poor management of the soil and water

5. A rustic property can be used to obtain economic profit in the market of purchase and sale of properties.

In this last section we deal with how to obtain economic profit in the market of a rustic property.

As an investment resource in search of yield: Rural properties tend to be an attractive investment due to their high capacity for revaluation. This is notorious when they are located in geographic areas with development potential.
Long-term profitability: Although investment in rural properties can be profitable, it is important to bear in mind that the results will vary, since the economic return often depends on climatic factors, changing markets and our actions (or inactivity).  
Buying and selling: As in any market, in order not to suffer losses, firstly, it is crucial: to investigate thoroughly until we know the big trends, secondly, not to make impulsive decisions based on what we believe.
At this point it is necessary to seek advice from various professionals:

a) Real estate agents:

At Finques Feliu our professionals specialized in real estate can advise you on whether the 'market momentum' is favorable for selling, renting or, on the contrary, the most prudent thing to do is to wait.Let us suppose that you decide, after a meticulous analysis, to sell.

This is when our experience in real estate brokerage comes into play. In this sense, we will inform you about the taxes that fall on the parties when the transaction takes place, pointing out which party has to pay them. Naturally you can clarify any doubts you may have. 

b) Lawyers specialized in rural properties:

Arrived at this point, the lawyers who have the objective to obtain a legal, accurate drafting of contracts. As in the previous step, you should feel free to ask questions.

c) Notaries: 

They have the legal obligation to do the following tasks:

• To make sure that both parts understand the contract they sign. This includes that as always if there are doubts they have to answer them in an exact and intelligible way.
• Make the parts aware of the contract clauses which they sign.
•  To warn the parts of the taxes that burden the transaction and to indicate which part has to pay them.
• To validate in a reliable way the operation, whereas, the notaries are the testimony for legal effects.

With the intervention of all these professionals you will be able to make the transaction without surprises.

Are you ready for the second part of this subject that we will deal with in a week: 'the settlement of the estates built in rustic land in the Catalan Civil Law'.