Buying
Spanish Property
Once you have decided on the Spanish property you wish to purchase, an
initial reservation deposit will need to be placed of between 3000 and
6000 euros, then a full deposit of 10% of the purchase price is required
as official confirmation of your intent to buy that Spanish property.
The remaining 90% is payable on the signing of the title deeds at the
Notary (normally 70-80% is with a mortgage).
If you are purchasing a new construction then the developer may ask for
stage payments to be made on the property. These can vary dependent on the constructor and the length of time remaining to completion of the
property.
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Appointing
a solicitor (abogado)
We will appoint an abogado that speaks your language to deal with the
purchase your property in Spain. They will be able to do the necessary
searches and check out any outstanding debts that may exist on the
property as well as help with contracts and NIE numbers(see below). They
will also check the legal paperwork and make sure the property has the
required permissions. You are free to appoint a solicitor of your choice,
or if you prefer we can recommend one.
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NIE
number (Numero de Identificacion de Extranjeros)
NIE number (Numero de Identificacion de Extranjeros)
It is essential to have an NIE number for any financial dealings you may
have in Spain, including buying Spanish property. Obtaining an NIE
number is a simple process that will normally be dealt with by your
solicitor at the same time you make your purchase and the price for this
is generally included in the fee for the conveyancing. However, you can
apply for one separately via a Gestor (fiscal representative) who will
normally charge around 30 or 40 Euros.
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Applying
for a Bank Account
It is necessary to have a Spanish Bank Account to purchase a property in
Spain, it will also be used for direct debits for all future bills on
your property e.g. electricity and water. Again, the solicitor will
usually make all the arrangements for you at the same time as the
Conveyancing. If you prefer to arrange a bank account yourself we can
help with recommending good local banks with staff that speak your
language.
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Applying
for a Mortgage
You can choose to apply for a mortgage in Spain or from the UK. Mortgage
rates in Spain tend to be slightly lower than in the UK, currently
around 3.25%. Spanish banks will normally lend up to 70-80% of the
property value. You will need to prove that you have sufficient income
and you will also need to put down a minimum 20% to 30% deposit.
It can often be more practical and cost effective to simply re-mortgage
your home in the UK. We can arrange for a consultation with a fully
qualified and independent mortgage advisor if you would like to discuss
your options.
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The
Notary(Notaria)
This is a lawyer appointed by the Spanish government to witness the
signing of all legal public documents. In this case the title deeds (escritura)
of the property. He represents both the buyer and the seller. The
Notary fees are around 0.5% of the purchase price of the property and
must be paid at the time of the signing of the deeds.
The Original signed document is retained by the Notary who will apply
for a formal change in the land registry. The purchaser will receive an
initial legal copy of the title deed which is signed and stamped by the
Notary. The official title deed can take a while to be processed and
until then this is your official proof of ownership and must be kept in
a secure location.
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Purchase
Taxes and fees
We recommend that you allow a sum of around 9 to 10% of the price of the
property to cover payment of purchasing fees e.g. land registry fees,
notary fees, legal fees, transfer taxes.
If you are purchasing property in Spain we suggest you consult with a
professional financial adviser beforehand to discuss any possible
financial/tax implications regarding Spanish or UK income tax, capital
gains tax or inheritance tax.