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When you purchase a property in Spain, it is essential to ensure that you have all of the correct information BEFORE you take the plunge.
First of all, you will need an NIE (Numero de Identificación de Extranjeros), which is the "Foreigner's Identification Number" - we can help with this and opening a Spanish bank account if needed. See this separate side box for more information.
Here is our guide to the process involved in buying a property here in Spain:
Viewings are primarily conducted in this area one-to-one with your agent. The more information you can provide on your specifications, the better. It is not unusual for one agent to show another agent's properties - this does not cost the purchaser any more money, as the two agents share the fees in the event of a sale. When at a viewing, it can be a lot of information to take in, and if you see several properties in one day, they all start to merge into one so ask questions, make notes, and if you want to take your own photographs, you can.
In the same way as the UK, once you have decided you would like to purchase a particular property, you make an offer, via the agent, to the vendor. Also, in the same way, as in the UK, there may be a little toing and froing by the agent between the vendor and yourselves to reach an agreement. It is best to organise your NIE number at this stage if you do not have one, and we can help arrange this. We can also help if you need a mortgage.
Once a purchase price has been agreed upon, it is usual to leave a reservation deposit with the agent (usually 3,000 to 5,000 euros). This ensures that the property is taken from the market and unavailable to other potential buyers whilst the contract is drawn up and preliminary searches are done. This deposit is non-refundable if you pull out and the paperwork is all in order.
The contract should be drawn up a few days after the reservation deposit has been paid and once all of the relevant paperwork has been collated. The lawyers will require copies of photo identity, title deeds for the property, rates and utility bills and will need to check that there are no outstanding debts on the property. Contracts will be in Spanish and will defer to Spanish law. (Some contracts will also be in English, but if not, ensure that your lawyer provides you with a complete translation).
The purchase contract will usually require you to pay 10% of the purchase price - either at the point of signing the contract or at an agreed date after that (often approximately 14 days)
Although purchasing a property is not complicated in Spain, and your agent should be able to take you through the process smoothly, we would always recommend that an independent lawyer is retained(Abogado). There are several lawyers in this part of Spain - we feel it is always sensible to use recommended lawyers - and many speak excellent English.
This Lawyer will take care of you and assist you through the complete buying process. Once the sale is completed, your lawyer should then change all relevant documentation and bills into your name.
All purchases in Spain are completed in the presence of an official Notary, where the title deeds (Escritura) are signed over from vendor to purchaser. The appointment will be made either by the agent or one of the lawyers either before (by mutual agreement) or on the date of completion as stated in the purchase contract. This is usually 4 to 6 weeks from making the deposit, and your agent and lawyer are also present. You will make the final payment to the Vendor, who will simultaneously pass over possession of the property to you, handing you the keys. The Notary will pass the details of the new Title Deed to the Land registry, which will record the new owner's details.
Pictured l-r: Daniel Herranz, a lawyer we work with and Emily and Rodney who bought a villa through us - all smiles on notary day.
The costs involved with purchasing a property in Spain can be almost as much as 13% on top of the purchase price. A 10% purchase tax (10% of the purchase price) needs to be paid to the Spanish government; there are notary fees and Land Registry. These fees are based on a sliding scale depending on the property's price (about 0.5% for both). And, of course, legal fees if a lawyer is retained (about 0.5%) will also be payable at completion.
Budgeting for 12%-to-13% (if you buy without a mortgage) is typical. If you buy with a mortgage, additional set-up costs and fees are associated with the mortgage deeds, which will be on top of the original purchase price (your mortgage provider will confirm these costs).
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