Marbella Property Solutions – Buyer’s Guide to owning a home in Spain.
As Spanish property specialists with a wealth of experience within the Real Estate Industry in Southern Spain , we are primarily focused on helping customers find their perfect property.
We will be able to recommend to you independent legal and financial advisors to help you feel comfortable with every phase of your property purchase in Spain .Ensuring that we recommend to you long established professionals who can speak your language, so fully understand the procedure every step of the way .
Almost without exception today’s property buyer begins searching on the Internet as the first step to purchasing a home overseas. The internet is a great tool, without question, but it the vast amount of information , which is to be found can cause confusion and uncertainty in the mind of a potential buyer.
Our advise is whilst you being your initial search , make contact with at least 3 Agencies, talk to them directly, not just on email. Arrange a skype call – in other words interview your Agent and feel comfortable with them before you come to view property. Make it your first priority to work with a experienced Agency who will take the time to get to know you , your requirements and will be prepared to go the extra mile to find you the right property.
The Costa del Sol Agencies all work on the multi listing system, so if your chosen Agency does not have exactly what you want in their own inventory they will be able to find that perfect property for you through their colleagues in other agencies on a commission sharing basis.
FINDING A LAWYER
Marbella Property Solutions always recommends that client’s buying a property in Spain use a qualified, bi lingual Spanish lawyer to represent them and when necessary, financial advisors to deal with tax issues. You do not have to wait before you have found your perfect property to look for a lawyer in Spain . We recommend you make contact with a lawyer – ideally one who comes with a recommendation from an associate or friend on your first property search visit.
Find a lawyer, obtain an NIE number (a number issued to foreigners in Spain) in place, and open a non resident bank account . These steps will strengthens a buyer’s position when negotiating as he or she can put down an immediate deposit if an offer is accepted, since all the other details will have been taken care of already.
YOU HAVE FOUND YOUR PROPERTY – WHAT NEXT?
The Spanish system is simple, secure, transparent and efficient .
Once you have found the property you wish to purchase , your offer will be presented to the Seller. If you offer is accepted , the next step would be for Marbella Property Solutions to draw up a “Reservation Contract”.
A reservation contract is used in Spain as a standard procedure to reserve a property for a specified period of time whilst your lawyer conducts the process of due diligence to confirm the legal status of the property and ensure there are no debts or liens/embargo’s on the property.
WHAT IS A RESERVATION CONTRACT?
Usually, the reservation contract would set out the basic terms and conditions of the purchase and would then be approved and signed by both the buyer and the vendor. This is a temporary reservation document only. Such a document would include:
Full name of the Seller and Purchaser
The agreed purchase price
The address of the property
Other special conditions – such as subject to finance approval .
The reservation deposit amount paid.
The proposed date of signing a “private purchase contract”
A €6,000 deposit will secure the property while the “due diligence” takes place. This deposit can be paid by credit card, bank transfer or in cash, it can be held in our company client account or with a lawyer of your choice. The reservation deposit removes the property from sale, whilst your chosen lawyer carries out due diligence. If you need a mortgage , you should use this time period – usually 4 . 6 weeks to arrange your mortgage.
This reservation deposit is fully refundable in the event that your lawyer should discover any legal reason’s why you should not purchase the property. If you continue with your purchase after the due diligence the 6,000 Euros deposit will be used as part of the purchase price.
WHAT HAPPENS NEXT ?
When your lawyer has carried out a full and thorough *Due diligence, you will be duly informed of his/her findings and discuss whether to proceed to the preparation of a private purchase contract or go straight to a final completion.
WHAT IS A PRIVATE PURCHASE CONTRACT?
A private purchase contract is a legally binding contract between the purchaser and the seller, setting out the terms and conditions of the contract. The contract will be prepared by your lawyer and will contain:
- A legal declaration from the vendor that he/she is legally positioned to sell the property
- The exact address and dimensions of the property and its features as set out in the “referencia Catastral, the Government registration of the property.
- The completion date and hand over of the keys.
- The terms and conditions as agreed buy the purchaser and the seller
- A 10% non refundable deposit is payable on the signing of the Private purchase contract
THE PRIVATE PURCHASE CONTRACT IS GENERALLY REQUIRED IF THE COMPLETION DATE WILL TAKE PLACE SEVERAL MONTHS, OR LONGER, AFTER THE RESERVATION DEPOSIT HAS BEEN MADE. IF THE PURCHASE IS TO TAKE PLACE IMMEDIATELY FOLLOWING THE DUE DILIGENE PROCESS, THIS MIDDLE STEP IS UNNECCESSARY.
ADDITIONAL PURCHASE COSTS
In Spain costs vary from 10% to 13.5% of the purchase price, and the costs are broken down as follows:
TRANSFER TAX (I.T.P)Payable by the buyer for the purchase of any Real Estate (villas, flats, land, commercial premises, garages), provided the vendor is not a developer or normally trading in the business of resale properties. If the “minimum fiscal value” of the property as per the Regional Government, is greater than the price, then the minimum fiscal valuation applies:
Villas, apartments to the value of 400,000€ - 8% .
To the value between 400,000€ - 700,000 € - 9%
For value exceeding 700,000€ - 10%
9% is applicable to the amount between 400,000€ and 700,000€ or between 30,000€ and 50,000€ for garages; 10% is applicable to the amount exceeding 700,000€ or 50,000€ for garages.
VAT AND STAMP DUTY – APPLICABLE TO NEW BUILD PROPERTY
• Villas, apartments, or a garage that is annexed to an apartment or villa, where the vendor is a developer, promoter or habitual trader for brand-new properties. 10% (VAT ) + 1.5% ( stamp duty
• First sale or resale of parcels of land, and for the first sale of brand- new commercial premises where the vendor is a developer, promoter or habitual trader or a company. 21% VAT + 1.5%( stamp duty )
NOTARY AND PROPERTY REGISTRY FEES The cost increases according to the number of pages or complexity of the title deed, and value of the property. +/- 3,000 €
MUNICIPAL ADDED VALUE TAX (PLUS VALÍA )This can be as little as a few hundred Euros or as much as many thousands of Euros on a property with a lot of land that has not changed hands in many years. It is a tax by the town hall based upon the increase in the index value of a property between the year of purchase to the year of sale. This tax corresponds, by its nature, to the vendor who is responsible for its payment, unless otherwise negotiated.
LAWYER’S FEES These are in the order of 1% of the selling price, more or less, depending on the lawyer and the price of the property.
Therefore when calculating the likely total costs for purchasing a property in Spain are – you should consider the addition of :-
1. Constructed residential properties that are 2nd hand 10 – 11 % of the agreed purchase price.
2. Newly constructed or off plan properties 12% if VAT is paid on the purchase price plus lawyer’s fees.
Make your search for a Spanish property as stressfree and simple as it can and should be by using a Marbella Property Solutions Personal Property Finder.
Peace of mind – Your PPF is in effect like an independent broker , with no agenda accept to find the perfect property for you . Your PPF will offer sound, impartial advice, no sales pitch and will only deal with legal properties and reputable Agencies.
Save time - Your PPF will look through thousands of properties, eliminate inaccurate andnon-existent listings and present only those that they know are right for you, even previewing on your behalf to ensure that when you view, the right boxes are being ticked .
Save energy - Eliminate the time you waste answering the same questions with endless agencies only to be offered the same properties over and over again.
One point of contact - your search is dealt with by a dedicated PPL who understands your requirements.
Complimentary service - The service costs you nothing at all and there are no strings attached.
After- sale service - Once your sale has completed, your PPF is still just a phone call away should you need any help settling into your new home
Why not ask for your own Personal Property Finder ?
This NO COST complimentary service is in essence a personal concierge service tailormade for your requirements.
Just email us with your requirements and your telephone number and we will allocate you an experienced member of our team who will work with you to find the right property for you. Your PPF will organise your viewing trip , organise accommodation and car hire on your behalf, plan and book all viewings , accompany you on your viewings, and help you with obtaining required legal papers such as your NIE number ( tax number ) opening a bank account and any other matter’s related to your property purchase in Spain.