Buying a property in Spain
How you find a property and how you do finally select the property you want to purchase is a process that can last a long time or in some cases not more than a day. This all depends on how prepared you are and with whom you have contact in Spain.
Some buyers have been to Spain many times before buying a property here and they know exactly where and what they want to buy and at which price.
Others will benefit from advice from serious estate agents or advisors both what concerns in which area to purchase and also at which price.
The process and complexity will also depend on whether the property is new and bought directly from the constructor, when under construction, or if the property is second hand.
The buying process
When you have found the property you want to purchase and you have agreed on the price you sign a pre-agreement or a reservation contract. A reservation sum of Euro 3.000 - 6.000 is normal and serves for reserving the property for typically 30 days after this you either lose your deposit or proceed to the actual purchase.
Before signing the reservation contract your lawyer must check that there is no debt in the property, that all bills have been paid and that the seller is the righteous owner of the property and not at least that the title deed match with the property that you have agreed to purchase.
In the sales contract you agree on the date of the actual purchase and the payment terms. If you have not already applied for a NIE and opened a bank account you will need to do so before the actual purchase can be carried out.
The actual purchase takes place in the Notary´s office where either yourself or the person with the power of attorney and the seller or someone appointed by the seller are present with the Notary. Having signed the documents and verified that payments have been made you will then get the keys to your property.
Purchase expenses
As almost all prices are stated as net prices in Spain you must as a rule of thumb calculate an extra 8-10% to the advertized price. The 8-10% will cover the following fees:
| Type of cost re-sale property | Price | Example
Price E 300.000 |
Lawyer's fee
Depending on the price of the property and the complexity of the purchase | 0,5 - 1% | E 3.000 |
| Transfer tax (ITP - impuestos de transmisiones patrimonales) | 7% | E 21.000 |
| Notary fee maximum | 0,5% | E 1.500 |
| Property registrer fee | 0,1 - 1% | E 425 |
| Utility contracs - change of Electricity, water, gas | E 400 - 600 | E 500 |
| TOTAL additional cost | 8 - 10% | E 26.425 |
| | | |
Cost of owning a property in Spain
| Type of cost per year | Price |
Insurance
Depending on the price of the property and the content | From E 200 |
Annual property tax | 0,2 - 2,5%
Base - Valor Catastral |
Local annual property tax (IBI) | 0,2 - 1,1%
Base - Valor Catastral |
Community fees
Pool, garden, security, general maintenance | E 400 - 600 |
Utility contracts - fixed cost
Electricity, water, gas, garbage | E 400 - 600 |
| | |
Please note that if your property is rented out an income tax apply as well. For more information please contact us.
Important documents and procedures
Some documents must be at hand when purchasing a property in Spain.
First of all you need a NIE number (Numero de Identificación de Extranjero) This number you will need for applying for many things in Spain. First of all to open a bank account, but also if you wish to apply for a loan, purchase insurance or work in Spain etc. The form for applying for the NIE can be obtained at the local police station.
Thereafter you need to open a bank account. As soon as you have the NIE number you can open a bank account in Spain. This will serve not only for transfer of the purchase sum or part of it but also a bank account will ease the payments of the fixed charges such as electricity, water, local taxes and community cost. These expenses can then be drawn automatically on your bank account without extra charges.
You can either apply for these documents yourself or you can issue a power of attorney for someone in Spain, this could be the lawyer you intend to use when making the purchase.
If you have given power of attorney to someone you in fact do not need to be present at the actual purchase, this could then be carried out by the person authorized.
We should be please to help you with the practical details as well before purchasing a property in Spain. Please contact us for more information contact@atrea.dk
Visit Spain
Are you considering coming to Spain to take a look at the property offerings or maybe just to explore the regions where you might want to look for a property then please contact us for an inspection trip.
