GENERAL INFORMATION

Purchasing property in Spain is safe and simple. The system of land registration is advanced and professionally administered. It offers a high degree of certainty with reference to the ownership of property, especially relating to Title, descriptions of the properties and with regard to limitations or rights corresponding to the property.

As investment in property is one of the most important legal transactions one will ever make, expert legal advice is essential. A solicitor should always be employed to carry out searches and ensure that everything is legitimate. A locally based firm of lawyers, familiar with Spanish Conveyancing Law, is always strongly recommended.

PURCHASE PROCESS:

The purchase process can vary from property to property and is often adapted to suit individual circumstances.

When you have found the property you want to buy, you will have to pay a holding deposit of usually between €3000 - €6000 when you sign the reserve contract either with the builder or the Agent/Vendorof the resale property.

If you are purchasing a new property that is completed and ready for occupation normally you will pay up to a 50% deposit and the balance at completion of the sale. This could be within a few weeks.

If you purchase a new property with an extended delivery, say six months or more, then you will be required to make additional stage payments:

If you are purchasing a resale property, then you will be generally required to make the following payments:

1. €3000 - €6000 deposit when you sign the Reserve Contract

2. 10% of purchase price within 7 - 10 days on signing a Contract (usually Option Contract)

3.  Balance on Completion

Completion time will vary depending on your instructions to your solicitor or if the vendor is living in Spain or has issued powers of attorney to someone in Spain or if there are any complicated legal issues to settle. Normally the average time to complete is four to eight weeks.

PURCHASING SPANISH PROPERTIES - COSTS
Generally, the total expense incurred in buying a property in Spain is about 10% of the value of the property you are purchasing, made up as follows:

 NEW BUILD PROPERTIES

IVA (Spanish equivalent of VAT at 7%)
Stamp duty (On New Properties at 1%)
Legal fees ( Spanish Lawyers fees at 1%)
Notary fees (Approx 0,4% - 0,5%)
Land Registry fees (Approx 0.3 – 0,4%)
Total

RESALE  PROPERTIES

Transfer Duty  (7%)
Legal fees ( Spanish Lawyers fees at 1%)
Notary fees (Approx 0,4% - 0,5%)
Land Registry fees (Approx 0.3 – 0,4%)
Total

 There are some items not always applicable to every purchase such as “Plusvalia” tax, a local government tax on the increase of the value of the land since the last sale. By law, this tax should be paid by the VENDOR.

 
ANNUAL RUNNING COSTS -NON- RESIDENT PROPERTY OWNER
• Wealth and Income Tax are payable once a year and are calculated as a percentage of the property value.

• Wealth Tax = 0.2% of property value.

• Income Tax = 0.5% of rateable property value.

• Local rates

• Community fees

• Electricity bills

• Water bills

• House Insurance