GUIDE TO BUYING A PROPERTY IN SPAIN

GOLDEN RULES

1. A home in Spain is probably the investment of a lifetime - find an independent lawyer to protect your interests and only yours. All lawyers at Andalusian Lawyers are totally independent.

2. The Spanish legal system is very different to those found in the UK and other Northern European countries. So it makes sense to place the legal side of buying a property in the hands of an independent lawyer.

3. Contact an independent lawyer before you pay or sign anything. Talk to your lawyer before you commit yourself to anything, otherwise the estate agent, developer or seller will take control of the purchase process and it could affect your interests, as there are initial checks to do before any money is paid.

4. Whatever the estate agent, developer or seller tells you, check with your lawyer first. Remember, estate agents in Spain charge very high commission and may pressurize you into a purchase.

FIRST STEPS:

Decide Which Property: as soon as you make your decision, instruct your independent lawyer to do the first basic checks BEFORE you part with any money.

Deposits: a reservation fee (e.g. €2,000) may be required. If so, make sure it’s returnable if you decide not to go through with the purchase. Ten per cent must be paid when you sign a private contract. Your lawyer draws up this contract protecting your interests. NEVER sign a contract drawn up by the estate agent, developer or seller.

Surveys: surveys are increasingly common in Spain and advisable if you are buying an old or rural property or a detached villa. Andalusian Lawyers can recommend good surveyors.

Requirements:

  • NIE (foreigners identity number): you need this to pay taxes and register the property in your name. Andalusian Lawyers can arrange a power of attorney for you to sign in your home country (at a Spanish Consulate or notary public) to allow us to apply for the NIE on your behalf. OR you can apply for it in person at a local Police Station when you're in Spain, but bear in mind you will probably spend all morning in the queue!
  • Bank account: you need to open a bank account in Spain for payments for completion and direct debits afterwards. Opening an account is easy, but Andalusian Lawyers can help if necessary.
  • Power of Attorney: Andalusian Lawyers can arrange one for you if you cannot come to Spain for completion.
YOUR FINANCES:

Mortgage: if you need a mortgage, start negotiations with a bank as soon as possible. Tell your lawyer as well so that the private contract includes extra time to finalize mortgage arrangements before completion. Andalusian Lawyers can give you a hand in this process, but bear in mind that in Spain lawyers do not arrange the clients finances.

Final Payment on Completion: the balance of the price (usually 90 per cent) plus the amount required by your lawyer (for taxes, fees and other expenses) should be transferred to your Spanish bank account a week before completion.

Buying Costs: allow around 10 per cent to cover taxes, fees and other expenses. The breakdown of costs is as follows:
  • Transfer Tax: 7 per cent of the price. Off-plan properties pay 7 per cent VAT plus 1 per cent Stamp Duty.
  • Notary and Registry Fees: expect to pay from 600 to 1,000 Euros for an average property.
  • Lawyers Fees: lawyers charge between 1 and 1.5 per cent of the price, depending on the price of the property and the complexity of the purchase. Expect to pay a minimum fee for very low priced properties.
  • Gestoría Fees: many lawyers use a gestoría to deal with some other paperwork for their clients (pay taxes, arrange direct debits and water and electricity contracts etc.). Expect to pay around 250 Euros for this.
COMPLETION:

Lawyers Duties: Before completion, the lawyer carries out comprehensive checks on the property to make sure you buy the property in perfect legality, free of debts (e.g. from the local council, community of owners etc.) and free of embargoes or encumbrances. The lawyer also checks for any other possible problems. Andalusian Lawyers are totally committed to this aspect of the buying process. For your peace of mind, all lawyers at Andalusian Lawyers are registered lawyers and covered by professional indemnity insurance.

Signing the Deeds: We accompany you to the notary and before you sign, check the title deeds are correct, translate them into perfect English and make sure you understand everything you are signing and doing.

AFTER COMPLETION:

Obtaining your Title Deeds: We arrange for your title deeds of your new property to be taken to the Land Registry, for payment of all taxes and fees, and collect the deeds when they are fully registered. This process takes from one to three months, depending on the Land Registry.

Arranging Direct Debits: For your peace of mind we can arrange direct debits for your new property to be paid through your Spanish bank account. These can include electricity, water and telephone bills, annual rates and community of owners’ bills. We can also arrange for water and electricity to be installed or contracts changed to your name.

POST-SALE SERVICES:

Annual Taxes: if you wish, we will organise the filing and payment for the Non-Residents’ Income and Wealth Tax (paid annually) on your behalf.

Wills: We offer comprehensive advice on inheritance matters and the drawing up of a Spanish will – essential if you wish to make things easier for your heirs during the inheritance process.

Andalusian Lawyers Your Independent Lawyers in Southern Spain