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Real Estate in Spain
New or rental
Acquiring a new or rental property and only having to unpack your bags is a choice that many decide to make.
Without the limitations of renovations or refurbishments, but with modern amenities that attract more and more buyers seeking simplicity.
We support you from A to Z in the acquisition or rental of your accommodation in Spain.
I search for and find the property that suits you best.
Finding
Informing
By conducting prior visits, I inform you of possible defects that a seller might “forget” to point out.
Ensuring
I check that all charges, taxes, and mortgages are paid. I also find a lawyer to verify the purchase contract.
The 8 steps to buying
in Spain
The procedures for buying real estate in Spain are less complex and faster than in Switzerland. Sometimes just a few days are enough between the moment a buyer commissions us and the moment we uncover their rare gem. But what is the process of buying a property in Spain? The following stages have an average duration of three months, depending on the city and the cases.
Here are the eight major steps that mark
the path to your investment in Spain:
definition
and fees
1
Get your NIE
STEP 1
A non-Spanish resident must have an NIE (Spanish identification number) if they are European, and a TIE for non-Europeans, which is in the form of a card.
Having a Foreigner Identification Number (NIE) is essential to make a real estate transaction in Spain possible. This document identifies you to the Spanish state.
Moreover, it will allow you to open a bank account, start a business, buy a car, or even place an order on Amazon.
2
Budget and financing definition
STEP 2
One of the first points we seek to clarify quickly with potential buyers who contact us is the issue of financing. In fact, the first thing to know about financing in Spain is that Spanish banks only lend 60% of the property value to non-residents, excluding notary fees.
In general, for a mortgage in Spain, count on a personal contribution of 50% of the property price.
Do the math well before you start.
3
Any property you buy in Spain is subject to a series of fees and taxes. These vary depending on each property. However, this represents approximately 15% of the purchase price. This increase relative to the total purchase price must cover all costs, including real estate, lawyer, notary, and tax expenses.
ITP
The main tax you have to pay if you buy a second-hand house in Spain is the Property Transfer Tax (“ITP”). This tax can vary from region to region and may be subject to changes.
STEP 3
Notary fees
Notary fees are set according to an official scale. Rates vary according to the size of the land, the size of the property, and the sale price of the property. Notary fees can be shared although often the buyer has to pay the notary fees. In addition to the notary, fees will be paid to the property registry.
Fees
The seller must pay the capital gains tax on the sale at the same time as the Plus Valia, which is a municipal tax on any capital gain based on the property registration.
Normally, the buyer will pay the aforementioned transfer taxes and fees. Spanish consumer regulations advise splitting this expense between the buyer and seller, but in some cases, the seller insists that the buyer pays them all. Again, this is something your lawyer should discuss with you and the seller.
IBI
​IBI is an annual property tax paid by the owner to the local council. Anyone who owns property in Spain pays this every year.
This receipt is very important when buying a property for two reasons:
-
It indicates the cadastral property number, which can provide information about the property you are acquiring.
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It will also show the cadastral value of the property according to the valuation by the Tax Agency.
Your lawyer should ensure that all IBI taxes have been paid in the last 5 years, making sure the house has no debts with the council.
4
Property selection
Your project is maturing, you are at the stage of finding your future property in Spain. Surely you have been redirected to articles like this, or real estate portals like Idealista, Habitaclia, Pisos.com, Kyero.com, Green-acres.com.
However, between sometimes (if not most of the time) dubious quality photos, the language barrier, doubts about the legal status of the property, its geographical location, among others, you are a bit lost.
You can plan round trips between your country and Spain, but you risk unnecessary trips, lost between bad rental properties advertised by agents, or victims of sometimes desirable severity.
For all these reasons, we advise you (obviously 🙂!) to call us. This option allows you to save time and avoid unpleasant surprises.
We advise and accompany you from A to Z in the entire purchase process and avoid these unnecessary expenses by moving around. During the visits, your agent is responsible for checking the general condition of the property and the building (heating, insulation, possible work), and collecting key information such as the amount of condominium fees and property tax.
STEP 4
5
Legal checks
STEP 5
In Spain, the role of the notary is very different from that in the rest of our French-speaking countries. That is why the intervention of a lawyer is necessary and indispensable.
To offer the most complete service possible to our clients, we systematically include in our fees the intervention of a lawyer registered with the bar association of the province in question. This lawyer will give you a written legal opinion that will allow you to decide whether or not to proceed with this real estate acquisition. They will also be present with you on the day of the sale.
Their function is to verify the identity of the owners, the absence of debts, charges, cadastral conformity, and the absence of urban planning violations.
Some points can be completed in a matter of weeks, while others may take several months. In any case, the decision to proceed with a transaction is yours.
The cadastre office is the second system used to identify the exact boundaries and location of the property. The cadastre provides a brief description of the property.
6
Property reservation
In Spain, to consider your intention to purchase, you must pay the agency or the property owner an amount that can vary between €1,000 and €3,000. This, called “Reservation” or “Signal,” is accompanied by the signing of a pre-contract that contains the main information about the property.
The owner then has between 2 and 5 days to accept or reject the offer. In theory, visits should stop. Unfortunately, in practice, many owners or agencies persist in trying to get a better deal.
If your offer is not accepted, the agency must refund the total amount of the reservation.
On the other hand, if accepted, the advanced amount becomes part of the sale price. It is usually increased when the sales agreement is signed.
ADVANTAGES
Financing is quick. Bankers are very responsive and it takes an average of 7 business days to get an agreement in principle. Since the mortgage law came into effect on June 16, 2019, an incompressible period of 10 business days is required to be able to sign the sales deed before a notary.
DISADVANTAGES
The financing rate is less attractive if you do not live in Spain. For non-residents, that is, those who stay less than half the year in Spain, the bank finances only 60% or even 70% of the property amount for the best cases.
If you are a resident in Spain, the bank can finance 80% or even 90% of the property amount for the purchase of your main home. If it is a second investment, you are in the same boat as a non-resident.
Additional costs. It is necessary to hire an expert for what is called an appraisal, who will evaluate the property value (between €300 and €700 depending on the property size). Then, you must sign the bank loan before a notary. A process that costs around €900.
STEP 6
7
STEP 7
The sales agreement is a private contract established between the buyer and the seller. Called “Arras” in Spanish, it is not signed before a notary but will be requested by the notary on the day of the sale to verify the conditions agreed between the parties. This will include much essential information such as:
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The identity of the seller and buyers;
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The property address;
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The property sale price;
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The deadline for signing at the notary;
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The notary’s address where the sale will be signed;
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Any outstanding debts;
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Payment methods;
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The distribution of notary fees;
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Penalties in case of withdrawal by either party
In most cases, the financial advance made by the future buyer at the time of the signal (reservation) will be completed up to 10% of the property price.
In the case of a sale through a real estate agency, this money will, in most cases, be blocked in the agency's account to arbitrate in case of dispute.
In fact, in most cases, the commitments signed between two people are called “penitential arras,” governed by Article 1454 of the Spanish Civil Code.
This means that if the buying party withdraws, they lose the amount advanced. On the other hand, if the selling party withdraws, they must repay double the amount advanced by the buyer.
8
Signing at the notary and receiving the keys
The big day has arrived ! You will conclude the transaction by signing the "Escritura" or authentic deed. This is when you pay the outstanding balance. Some notaries agree to receive the transfer of the property amount in their account and then issue cashier's checks to the seller.
Others, on the other hand, refuse to receive an overseas transfer as a money laundering prevention measure. In this case, you should bring the cashier's checks duly issued by your Spanish bank.
To do this, you must have taken care to open a bank account in Spain first. In the event that a Spanish bank finances your purchase, it will issue the checks and bring them with you on the day of signing.
Good to know :
Ask your Spanish bank advisor in advance about the fees for issuing a bank check - you might be surprised! Indeed, some banks show tempting promotions offering you certain fees, such as the opening commission. On the other hand, they compensate you generously with the issuance of the check with fees that sometimes reach several hundred euros.
What if the seller of your future Spanish country house were none other than five brothers and sisters who had just inherited a family property? In this case, five checks would have to be issued and no one would pay them for you ...
The keys are always handed over at the same time as the signing of the title deed. The notary certifies the payment and the new notarial deed will be registered in the Land Registry, through his office or a collaborating firm. The taxes inherent to the purchase and in particular the ITP (Wealth Transfer Tax), must be paid within 30 days from the date of signature.
Now that you know every step of the process of buying a property in Spain, get started!
STEP 8
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