|
Buying property in Spain is much the same as buying a property anywhere else in the developed world. Costa Dorada Properties will be pleased to guide you through the 5 key steps to be taken:
Finding the property
The most common way to find property is to consult a number of estate agents, either via the Internet or by visiting local estate agents in the area in which you wish to purchase. In Spain estate agents typically charge the seller between 5% and 10% of the total sale price. As you may expect, there are a great many estate agents competing for such a high rate of commission.
The best way to find the property you are seeking is to speak to as many local agents as possible, requesting information regarding the properties each agent has on its books at any one time. If you speak to all the estate agents specialising in your target area within a one or two week period, you ought to be able to determine the state of the market. Naturally, if you wait for a few weeks or months other properties may come on to the market. By the same token, however, the best of what is currently available is also likely to have been sold.
At Costa Dorada Estates we provide our clients with full information regarding all the properties we have on the market. This includes the selling price, dimensions of the rooms and external areas, special characteristics, location, transport links and any other relevant details.
At Costa Dorada Estates we only take you to see properties that match your requirements. We have excellent local knowledge and, very often, we are able to show properties which have just come on to the market.
If it is a property in a new development you are seeking, we are able to introduce you to some of the most reputable developers in the area. Buying off plan is very common in Spain. However, it is essential to ensure that what you are buying has already been approved for planning. This can be done by asking for a copy of the relevant Licencia de Obras, or planning permission, issued by the local town hall. The document should be referred to in any agreement you sign and a copy of it should be attached to the agreement and signed by all parties.
Negotiating the terms of purchase, including the price
As a rule of thumb, price is always negotiable. Other negotiable terms include:
 The period of time between paying a deposit and completing the purchase
The Notary at which you will complete your purchase
The form of payment, i.e. cash, banker’s drafts, etc.
Who will pay the property tax (IBI) for the current year up until the date of purchase
Deciding whether any deposit will be paid prior to completion of the purchase and agreeing the terms of a sale and purchase agreement
Before paying any deposit, it is essential to have at least made preliminary enquiries in respect of the property and to be clear that:
The property is owned by those purporting to sell it
Either the owner signs the sale or purchase agreement, or the person who does sign is authorised to do so by the owner
The property can be used for the purpose for which you are purchasing it
There are no notes or cautions on the property register which may complicate the completion of your purchase
Agreeing a date for completion of the purchase
A final date for completion will be agreed in the sale and purchase agreement, if you enter into one. In that case it is important to leave plenty of time as, if you do not complete within the specified time, you run the risk of losing your deposit. Don’t fall into that trap unwittingly.
Completing the purchase, paying taxes and registering the property in your name.
Once all terms of the purchase have been agreed in principle, either in writing or verbally, completion of the purchase must take place either before a Spanish Notary or before a Spanish Consul. The Notary or the Consul will charge you a fee for the service. The Escritura Pública de Compraventa, or transfer deed, will contain all information relevant to the sale and purchase. Costa Dorada Estates will be pleased to assist you with this process.
If you are buying from a person not resident in Spain, you will be obliged to retain 5% of the declared purchase price and pay it into the Spanish tax agency on account of the non-resident seller. The 5% retention is designed to ensure that non-residents pay at least part of the tax they will owe to the Spanish state, in respect of their capital gain, upon the sale of the property. Form number 211 is used for this purpose and Costa Dorada Estates will be pleased to handle this matter for you.
Once you have purchased the property you will need to register your interest at the Registro de la Propiedad, or land registry. If you have borrowed money to purchase the property your lender will handle this matter for you as it is in the lender’s interest to register both your interest in the property and the lender’s security against the property. The lender’s security will take the form of a charge, or mortgage. The lender will levy a fee for registering your interest and the lender’s charge.
If you have not borrowed money to purchase the property it will be for you to ensure that your interest is registered. In order to register your interest you will first need to pay the tax payable. The amount of tax payable will depend upon the type of property you have purchased, from whom you have purchased the property and whether you have purchased a new or a resale property.
In order to make the tax payment you will need an NIE number. This is a “Número de Identificación Extranjero” required by the Spanish authorities to identify foreign nationals whose travel document number will change every time it is renewed. Although the certificate is issued by the Spanish Interior Ministry, the application for this number must be made at a central police station or Comisaria, from where the certificate must be collected. There are often long queues to apply for an NIE number and certificates are usually issued 3 or 4 weeks after application. Hence, it is essential to apply for your NIE number in plenty of time to ensure that you have collected the certificate on the day of completion.
Most Spanish Notaries will not allow foreign nationals to purchase without an NIE number. A minority may allow you to purchase without an NIE number. In any event, you will not be able to pay purchase tax until you have an NIE number. Failure to pay the tax payable within 30 days from completion of the purchase will result in a fine. Failure to pay within the first 3 months after the 30th day from completion will result in a 5% uplift of the tax payable, a 10% uplift is charged during the first 6 months, a 15% uplift is charged during the first 9 months and a 20% uplift is charged during the first 12 months. After 12 months have passed since the 30th day of completion, failure to pay will result in interest being charged on the 20% uplift. Hence, it is certainly wise to ensure prior to completion that you will be able to pay purchase tax within 30 days from then.
Once you have paid the purchase tax you will need to take the stamped transfer deed to the land registry for registration. The land registry will charge you a fee for registration.
Costa Dorada Estates is able to assist you at every stage of your property purchase. For more information please email info@costadoradaestates.com or call us on +34 977 254 300.
|