The Process of Buying a Spanish Property
In Spain the process of buying a property is regulated and you have to ensure that the property you have chosen is free of debts. We can put you in touch with English Speaking Lawyers that will guide you through the legal process. However, it is very common for the Spanish to purchase a property without the use of a lawyer and sealing the deal at the Notary.
We would advise all buyers to have a survey carried out on the property they have chosen to ensure that it is structurally sound and if there are any defects, how they can be resolved.
There are Two Legal Steps to Buying a Property here in Spain
- Contracto Privado de Compraventa (Preliminary Contract)
Before anything is signed with the vendor, A Nota Simple should be sourced by your solicitor. This is a check to make sure from the Authorities that there are no outstanding debts or charges lodged against the property. In Spain, a debt is transferred with the property.
Once this has been done and both you and your solicitor are happy and unless you are paying in cash in full for the asking price, a preliminary sales contract is drawn up. This is known as a Contracto Privado de Compraventa. It will contain all the details relating to the property such as they property description; the purchase price and the date of completion for the purchase. At the time of signing the Contracto Privado de Compraventa you will be expected to pay a deposit of between 5% and 15% of the purchase price.
- Escitura de Compraventa (Final Contract)
On the day of completion all parties will meet at the Notary’s office and the purchase price less the deposit already lodged, must be made payable to the vendor. Both the purchaser and vendor will sign the Escatura de Compraventa document, which is the equivalent to property deeds in the UK. This is conducted in front of the Notary who witnesses the transaction. A copy will be sent to the Tax office and to the Official Property Register.
Cost of Buying a Property in Spain
Buying a property in Spain is more expensive than buying one in the UK and this should be born in mind. These costs are as follows:
Property Transfer Tax
The property sales tax is as it suggests. A tax payable for the purchase of a property within Spain which is similar to Stamp Duty in the UK. The amount does vary depending on the type of property you are purchasing and the status of the Vendor. If the vendor is a private individual re-selling a property, then the purchaser will pay 10-15% of the purchase price.
If the vendor is a property developer, the buyer will pay 7% and then 5% AJT (additional stamp duty) unless this is a piece of undeveloped land or a commercial property, in which case it is 7% and then an additional 1% AJT.
Obviously, there is a charge for the Notary and this is usually between 400 and 800 Euros. If a mortgage is used to purchase the property, then there usually is a nominal fee added for registering the legal charge for the mortgage lender.