Legal Information on buying a Spanish property on the Costa del Sol

Purchasing a property in Spain is a serious commitment and it is essential that you think carefully about the what it is to be used for. A property which may be suitable for holidays or rental income may not be suitable for a permanent residence and vice-versa.

There are many Estate Agents in Spain who advertise on the internet and photographs on their websites may not portray the location and area of the properties. We have listened to many people who have seen properties on Estate Agents websites and booked flights to view and be very disappointed when they see the property is not what they expected due to its locality. i.e. too close to other properties, 5 kilometres along an unmade track or if it is in a town or village, no vehicular access. We do the ground work for you, investigating all the above to ensure that you only view properties which meet your criteria.

To purchase a property in Spain you will need an N.I.E. This is an I.D. document for foreign nationals who wish to own a property in Spain and is a legal requirement. We can help you to obtain one of these.

We also recommend that you open a Spanish bank account. This will enable you to make payments to utility companies and allow you to make financial transfers.

When you have found your ideal property you will be asked to make a reservation deposit of between 3000 and 6000 Euros. This takes the property off the market and allows the purchasing procedure of your new home to begin. We strongly recommend that you instruct a lawyer (abogado) to act on your behalf. The lawyer will make sure that the title of the property and all the paperwork are in order. When this has been verified as in order the purchase contract will be drawn up and a deposit of 10% will be required. A completion date will be made and on this date the purchasers and vendors will meet at an office of a Government official (Notary) who will oversee the purchase. The balance will be paid at this time. The keys are handed over and the property will now be yours.

Important : You should budget for an additional 10% on top of the purchase price to cover;

Transfer Tax. If a new property is purchased I.V.A. (Spanish V.A.T.) will be charged at 7% of the declared price. In addition there will be a charge of 1% Stamp Duty. If a resale property is purchased the transfer tax payable is 7% of the declared price.

Land Registry Fees. The fees for registration of the property at the Land Registry will generally be in the region of €400- €900.

Notary Fees. This is a fixed scale. These will amount to between €500 for a property price of €120,000 up to €1000 for a property which cost €600,000

Legal Fees. The fees that a lawyer will charge varies from firm to firm and will generally be 1 - 1.5% of the purchase price.

Frequently Asked Questions

Q: How much deposit should I pay to secure the property?

A: The amount you will be required to pay as a deposit is not written in any law. In most cases the deposit will be 10% of the agreed purchase price. In all cases you can secure the property with a smaller amount; normally this will be the equivalent of £2,000. In the event of any problems with the property all deposits should be refundable.

Q: How can I finance the purchase of my property?

A: Finance is readily available through all the major banks for your Home in Spain. Our associates have dedicated mortgage advisers able to offer the help required to select the most suitable loan to match your budget.

Q: What will it cost to register my new property?

A: The taxes vary on a new or resale property. However as a guide, your transfer tax, Notary fees, land registry fees and solicitors’ fees should not exceed 10% of the purchase price. This may increase if you take out a mortgage. Our associates will clearly explain and guide you through this process.

Q: Will I need to open a bank account in Spain?

A: We recommend that you open an account in a Spanish bank. You will need this account for the payment of your standing orders for, electricity, telephone, community fees, etc. Our offices will be able to recommend suitable local banks with English speaking staff.

Q: Do I really need a solicitor?

A: Yes, a solicitor is a must when buying a property in Spain. They will safeguard your interests and provide you with accurate information throughout the transaction.

Types of Property

Apartments.

Studios

These are situated on the coast and have communal swimming pool and garden areas. They normally have one room in which the lounge doubles as the bedroom area, there will also be a kitchen area and a separate bathroom.

Apartments or Pisos.

These again are situated on the coast with communal gardens and swimming pools but have separate bedroom or bedrooms. Some may have an en-suite bathroom and a separate bathroom.

Penthouse or Atico.

These are apartments on the top floor and may have more than one terrace or balcony area.

Finca.

A Finca is a detached bungalow on its own land. Its size could very from 50m2 up to 200 m2. These were originally very simple dwellings for people who worked on the land although now new fincas are built with modern techniques and are very comfortable.

Cortijo or Country House

A Cortijo is a collection of dwellings normally attached. These may be owned by several people or a sole owner. These are very popular for those who want a large house or for those wishing to start their own Bed and Breakfast or small hotel.

Townhouse

There are two types of houses which come under this category. The first is typically Spanish and these are situated towns and villages. They vary greatly in size from a one bedroom house with one small reception room through to a very large building with six or more bedrooms with two or more reception rooms. The second type are new builds on an urbanisation with private terraces, communal swimming pool and gardens.

Villa with Swimmming Pool

Villas

These have their own pool and land and could be on the coast or in the country.

Conditions of Properties

Conditions of properties can vary and for the purpose of our property search only, the following descriptions apply.

Ruin. This requires extensive work which may involve structural work including walls and roofs. There may be no electricity or water. The building may require demolishing and a total rebuild.

Reforms. These properties are probably structurally sound but may require work such as roof repairs, rewiring, new windows and complete modernisation .

Modernisation. These properties require internal modernisation such as new kitchen and bathrooms

Resale. These types of properties are generally less than five years old and are generally in very good condition.

New build. These properties as suggested are new and should be covered by the builders 10 year guarantee