The draft bill proposes that categorisation of terrain for change of use registration will be obligatory: from residential to touristic, for one-family homes destined to be developed for use as holiday homes. This means that if an already existing dwelling is situated on residential territory it will be necessary to change the category of the land under local authority by-laws to touristic. The draft bill sets out the administrative procedure that has to be undertaken in order to accomplish this change of use. The text, which was agreed between the ruling Partido Popular and Union Majorca parties, includes a full section on sanctions that will be brought to bear if the developer fails to comply with the new law. In the case of very serious breaches of the law, fines will range between 15'001 and 35'000 euros and it would be possible to suspend the developer's business activities if he continued to flout the law. Buildings that were operating as holiday homes prior to 1st January, 1998 will be able to fall in with the new law as long as the structure doesn't exceed the stipulated height and that it can be verified that such a business was indeed in place as of that date. The object of this draft bill that is to become law is to bring a business activity that has been pushing the margins of legality, especially in Santanyí, Pollensa and Formentera, under one umbrella. It is estimated that there are currently some 2000 of these properties operating in this market of which only 700 are doing so legally. The law will not give accreditation to holiday home dwellings under five years old so that the construction of new homes to put straight onto the holiday lets market is out of the question.
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