Buying Spanish Property Buyers Guide

Buying property for sale in Spain need not be a difficult or protracted process, although great care and attention should be afforded to the various aspects involved and the steps along the way. By working with a reputable and experienced real estate agent such as Arena Estates, the process can be achieved in the most efficient manner possible.

This page of our website is dedicated to providing important information needed when considering the purchase of Spanish Property. The information contained below is meant as a guide only and further research on the part of the buyer is advised. There are many good publications available on the Spanish Property market and the laws relating to foreigners in Spain although Arena Estates will take you step by step through the buying process ensuring the smoothest transaction possible.

Some of the most common questions that are asked about buying a property in Spain relate to the legal and financial aspects of ownership. It is completely natural to be a little cautious about embarking upon something that is unknown and might contain hidden pitfalls. We have therefore highlighted the most important aspects below. For more detailed advice on any of the steps or processes outlined below please call +36 1 266 5968 or e-mail info@arenaestates.com and one of our experienced advisors will be in touch as soon as possible.

Choosing a Location

As the old adage goes location, location, location… so consider the location first and foremost. Decide on a particular area where you think you will be happy spending a lot of your time. Research the area to find out what it is like in different seasons, what facilitates are available and the travel times to different places. And ask yourself, would you genuinely be happy living there?

Within this website you will find useful information on the various areas of southern Spain in which we operate, use this as a starting point. Speak to friends and family who may have valuable experience you can gain from and feel free to use Arena Estates experienced staff as we pride ourselves on our knowledge of various areas and regions and markets.

Budget

It is important to have a clear idea before you start, of the budget you have available, and broadly speaking the type of property you are interested in buying. Any good real Estate agent will be able to advise you much more clearly on what is available realistically once a budget has been set. Prices of properties in Spain vary drastically and by having a clear idea of price and type of property we will then be able to provide you with the most efficient service.

Choosing a Real Estate Agent

It is important to choose an experienced and competent real estate agent who will ensure your interests are looked after and who can provide a wide selection of properties that meet your criteria within the budget you have available. Arena Estates has years of experience and a long list of satisfied customers who have purchased property in Spain for both lifestyle and investment purposes.

Deposit

It is advisable to have a deposit immediately available of between 4,000€ to 10,000€ (Approximately 2,500 – 7,000 Pounds Sterling) dependant on the total price of the property in question. This will allow you to make an offer and secure a property in order to take a property off the market for an agreed period.

Spanish Property prices are still rising; although the market has cooled somewhat recently it is still a sellers market. By showing the seller the ‘colour of your money’ in terms of a deposit readily available, it will strengthen your hand in any negotiation process.

Appointing a lawyer

It is advisable though by no means compulsory that you appoint a lawyer (Abogado in Spanish) to ensure that you are covered against all contingencies. Arena Estates will introduce you to a lawyer upon your arrival in Spain or should you so desire, you may wish to choose your own legal representation.

Buying process

The legal process of buying a house is generally done in two stages. The initial contract signed between the two parties is known as the contrato privado de compraventa. The final exchange of deed is known as the escritura de compraventa. On occasion the two parties may agree to proceed directly to the exchange of title deed and omit the contrato privado de compraventa.

Property Purchase Costs

Transaction costs in the purchase of property in Spain are generally higher than in the UK and elsewhere in northern Europe it is advisable to budget in advance for between 9 to 11 percent of the total property value in costs.

Legal Fees
Legal fees are charged between 1% and 2% of the purchase value.

Value Added Tax
(I.V.A), which is currently charged at 7% plus 1% stamp duty. VAT is charged on new property only.

Transfer Tax
(I.T.P) at 7% is charged on the price of resale property.

Notary Fees
The scale is fixed by law and may range from 300 EUR for lower priced properties to 1,000 EUR for higher priced properties.

As an example, an apartment costing 300,506 EUR/ £186,314 will cost around 481 EUR / £298 in notary fees, whilst a villa costing 601,000 EUR / £373,000 will cost around 601 EUR / £373 in notary fees.

Property / Land Registry
Generally costs 60% of the notary fees.

Making an offer

Make your offer in writing if possible (subject to contract), and include not only the price, but also the amount of deposit, when you are prepared to pay it, when you are prepared to complete, what you consider to be included in the price (for example furniture and fittings if applicable) and, an often neglected point, that all machinery equipment and installations should be in normal working order.

Other compulsory costs involved in owning Spanish Property

Rubbish Collection & Water Rates
The rubbish collection rate is applied by the local town hall and payable every six months at a maximum rate of 258€ per year.

Water rates are charged by consumption in cubic metres on a quarterly basis.

Community Fees

Community fees vary dramatically dependant on the type of property and the urbanisation in question. It is extremely advisable to check in advance of what the community fees will be. The fees are payable for staff costs such as gardeners, maintenance and for the general upkeep of the premises. The budget for the annual expenses is set at the annual general meeting of homeowners.

Non-Compulsory costs to be considered

Insurance

A standard insurance cost for a 300,000€ apartment with contents valued at 40,000€ would be approximately 300€ per year. It should be remembered that in many cases the community is required to insure the building for its reproduction cost.

Telephone lines
A standard fixed line provided by Telefonica costs in the region of 120€ to install. Thereafter the bill is charged on a bi-monthly basis for calls made.

Disclaimer: The factual information within the Arena Estates website has been created using numerous sources. While every effort has been made to ensure the veracity of the facts contained within this website, Arena Estates assumes no legal liability or responsibility for the accuracy, of the information contained therein. Prices and exchange rates are also subject to change.