Buying Selling Info in , Orihuela Costa, Costa Blanca, Spain
Buying in Spain
Buying a property in Spain is different than buying in the UK.When you buy a re-sale property the whole process is a lot quicker. The legal procedures are also very different.
Like the U.K, buying a property in Spain, if not carried out properly, can be a harrowing and potentially an expensive and regrettable experience.The purchase of property in Spain is subject to different legal procedures than those in the U.K. and it is very likely a Buyer will not have encountered these in the past.
The British Embassy Consular Services have developed a list of Do's and Don'ts on this subject. In order to avoid mis-interpretation we offer the advice of The British Consular below: Please be aware of the Valencian Land Grab Law, which has caught many people unawares.
There are three ways of purchasing your property, either privately, from an agent or a development company. Buying privately can be a risk so do your home work and get a good solicitor, do not give a deposit to the Owner of the property you wish to purchase but arrange to have a holding account with the solicitor of your choice. It is advisable to find your own solicitor and most importantly, personal recommendation is always the best recommendation. More and more Spanish banks are offering mortgages which are cheaper than the U.K. at the time of writing, Spanish banks normally lend up to 70% of the valuation and will lend up to your 70th Birthday.
Your bank will deal with the financial arrangements, most have English speaking staff. All banks will offer you money transfers from the UK but you will pay bank charges, many people use a Foreign Exchange Organisation where you normally get a good rate of exchange, the more you transfer the better the rate.
A brief guide to how the system works in Spain.
On Re-Sale property, there is what is known as a ‘Transfer’ tax, this is approximately 7% IVA known as VAT is 7% Land Tax: This is usually called “Plus Valia” and is a municipal tax on the increase in the value of land since the last change of ownership. It is normally paid by the vendor. Notary fees, these are fixed by law and are based on a sliding scale depending on the sale price, usually between €320 and €700.
Stamp Duty, which is around 0.05% on the declared price and is payable on a new property that has never been inhabited.
Legal fees: Fees for the conveyance are usually around 1 to 1.5% of the purchase price. Deed Registration fee: This is usually between €180 and €500
On Re-Sale property there will be a deposit of 10% to be paid, out of that 10% you pay €3,000 Holding deposit, which is when the Seller takes the property off the market. You then pay the balance of the 10% deposit within 28 days. The deposit is non-refundable.
Re-sales in Spain normally take a month.
Buying a new property is different, you make staged payments. New developments can take as long as the Builder takes to build the property, even though they may give you a date for the completion of your new home, any unforeseen events can delay the completion date.
If you are taking out a mortgage, a valuation will have to be done. Spanish banks do not undertake to surveying the property, it is the Mortgage Broker who arranges this procedure.
You will need to employ a Spanish Lawyer, one that speaks good English. Your Lawyer will take you through every step and also goes with you to the Notario. The Notario plays an important role in your property transactions, they are responsible for the legalisation of all documents, certifying Passports, approving the Deeds. He or she goes through the Deeds with your solicitor who then translates all documents to you. From the Seller to Buyer, Solicitor and Notario, the whole procedure will be very informal and friendly.
If you are considering buying in Playa Flamenca, Orihuela Costa, Costa Blanca, Spain, good luck and happy house hunting.