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Property in Spain: How to save money buying a home on the Costa del Sol

Buying a home on the Costa del Sol represents a significant investment, perhaps one of the largest you’ll ever make.

Property in Spain: How to save money buying a home on the Costa del Sol
Photo: AFP

We aren’t just talking about the price of the actual property. Buying Spanish real estate also involves paying taxes and fees, between 8 and 15 percent depending on the price of the property.

Given the size of the investment, it makes sound financial sense to look at how to cut down your expenses.

In this article Celeste Alonso, manager of The Property Agent and an expert on real estate on the Costa del Sol, suggests seven ways to save money when buying a home on the Costa del Sol. 

Between them, they can potentially save you thousands of euros.

1- Tap into expert advice


Photo: AFP

Your first step to save money when buying a home on the Costa del Sol is to take advice from experts in the area. They include:

An estate agent with established roots and experience in your chosen location. Local expertise is vital, especially when it comes to understanding market prices – only a seasoned real estate agent will be able to tell you if a property is really worth its asking price. A good agent will also be useful when it comes to negotiating the price (see below).

A lawyer who speaks your language and defends your interests. Expert legal advice will check your chosen property for charges and planning illegalities, problems that can cost you money, time and stress later on.

Bottom line? Choose an agent who listens and cares about your purchase. This attention to detail will not only ensure you get the home you’re looking for but could save you money during the process.

READ ALSO: 


Photo: AFP

 

2- Negotiate the price

In Spain, haggling forms part of the culture, so there’s always wiggle room on a property price. However, there’s also a fine line between paying less and offending the owner. Go too low, and you risk the seller walking away from the table.

So, before you suggest a sum, tap into some expert advice from your estate agent to help answer the following questions:

Is the property priced to the current market?

A reputable local estate agent should be your first stop for advice on the price. They will be able to guide you on market values and tell you if your chosen property has a fair price. Ask also for examples of recent sales of similar properties. A seller may be more likely to accept a lower price if you can show that comparative homes have gone for less.


Photo by Euan Cameron on Unsplash

 

How motivated is the seller?

Your agent may also be able to give you some background on the seller. Why are they selling? How keen or desperate are they for a quick sale? Circumstances working against the owner, e.g. divorce, debt or mortgage problems, can shift the balance to the buyer’s favour.

How much would a cash purchase lower the price?

Cash is always king and can help you save money when buying a home on the Costa del Sol. If you are a cash buyer (or can be one), see if you can negotiate a lower price in exchange for a quick sale. A seller in a hurry may be willing to knock off a few thousand euros if it means you buy sooner.

Bottom line? Before you go to the negotiating table, decide how high you are prepared to go for the property. If the seller will only accept more than you can afford, be ready to walk away.

3- Bag some extras

Another way to save money when buying a home on the Costa del Sol is to purchase a property with as many extras as possible. They include:

  • Furniture and appliances – even if the furniture isn’t quite your style, you’ll be able to move in straight away and save on initial purchases.
  • Soft furnishings – curtains and blinds can be expensive, particularly if they’re custom made. You could save money if you negotiate their inclusion in the price or make a separate offer for them.
  • Garden furniture and fittings – most properties on the Costa del Sol come with an outdoor space, and you’ll save money if the terrace tables and chairs, pool loungers, barbecue… come included

Bottom line? Extras are only worthwhile if they’re quality. Sub-standard items with high wear and tear will cost you money to get rid of.

4- Get a survey


Photo: AFP

This tip for saving money when buying property on the Costa del Sol might seem contradictory because, after all, a survey costs money. However, the initial outlay can save you a lot of money later on.

Bear in mind that home staging and a fresh coat of paint make a home look fantastic, but they could be hiding a wealth of problems underneath. This is particularly true if you’re interested in an older or rural property. Bring in a surveyor to alert you to possible issues and defects so that you can negotiate a reduction in price with the seller or ask them to fix the fault before they sell.

Bottom line? Only a surveyor will be able to tell you the true nature of those cracks, the state of the roof, the age of the plumbing and electrical installations…

5- Shop around for a mortgage

If you’re buying on the Costa del Sol with a mortgage, spending some time researching what’s available has the potential to save you thousands. To help you see what’s available, use an online comparison tool and take note of the best mortgage deals suggested. Then contact the banks in question and find out what they can offer you.

Bear in mind:

  • The pros and cons of variable and fixed-rate mortgages.
  • Bank commissions for early cancellation, switching to a variable from fixed etc. Read the small print carefully and make sure you understand every clause.
  • Other commitments such as compulsory house and/or life insurance.

All the above can cost you money, so it’s worth spending some time doing the Maths.

Bottom line? With the Euribor in the negative territory now is an excellent time to take a mortgage on the Costa del Sol. 

READ MORE Spanish mortgages: Ten things foreigners should know before getting one

6- Use a currency transfer specialist

If you’re buying on the Costa del Sol with funds from a non-euro currency, transferring the money to Spain from pounds sterling or Swedish krona, for example, can cost you thousands in bank fees. To avoid extortionate bank charges, use a specialist currency firm to transfer funds for your purchase. Not only will you get a better exchange rate than at a bank, but you will also avoid a high commission. Transferwise is a great online tool that converts currencies at the market rate without all the extra costs charged by banks.

Bottom line? Consider looking into an exchange rate. While no one has a crystal ball and can predict what currency rates will do, there are general trends. Committing to a fixed rate for the time it takes you to buy can save you a lot of money.

7- Buying new build or off-plan on the Costa del Sol.

Photo: Niklas Schoenberger 

 

Purchasing a new property on the Costa del Sol is a popular option, and there are currently some excellent new developments under construction. At The Property Agent, we specialise in this type of property and just like resales; you can save money when buying a new home on the Costa del Sol.

Here’s how:

  • Buy offseason

The winter months are the least busy time of the year for off-plan property buying on the Costa del Sol. By extension, this is when you’re most likely to find better discounts. January is a quiet time of the year and a good month to approach the sales office.

  • Negotiate the price

Just like regular homeowners, developers are often open to discussing a price. Even if they refuse to budge on the final price, you may be able to get a special deal on the mortgage or an extra included for the same original price.

  • Change your requirements

If you have your heart set on a particular new development on the Costa del Sol, but your dream home is out of your budget, consider buying a smaller property or one with a different orientation. Slightly smaller floorplans, apartments looking west instead of south or with views over the hills instead of the sea are almost always cheaper.

  • Upgrade the finishes

Even if you can’t negotiate a lower price for your new build, the developer may be open to giving you better fittings and fixtures. You could get quartz worktops instead of granite, Bosch appliances rather than Balay or the air conditioning fully functional instead of the pre-installation. All these upgrades are worth money and add value to your home on the Costa del Sol.

Bottom line? The property market on the Costa del Sol is currently slanted towards the buyer, so there’s plenty of room for negotiation. And of course, if you don’t ask, you don’t get!

Contact the experts

This article has been written by Celeste Alonso, who runs The Property Agent specializing in real estate on the Costa del Sol. If you are looking for property on the Costa del Sol contact her for HERE. 

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PROPERTY

REVEALED: The cheapest most in-demand areas in Spain to buy a house

If you're considering making the move and buying property in Spain, but don't fancy purchasing in a rural village in the middle of nowhere, you should know where the cheapest, most in-demand parts of the country are.

REVEALED: The cheapest most in-demand areas in Spain to buy a house

If you’re thinking about relocating, Spain is a fantastic place to do it. Foreigners have been moving to Spain for decades, not only for its fantastic food and weather, along with a laid-back lifestyle, but housing is generally affordable – if you know where to look.

Though the rise in the Euribor has sent interest rates spiking, house prices in Spain are expected to flatten somewhat in 2023 and it could be a good year to find a bargain, depending on your financial situation.

Knowing what type of house you want and where in Spain you want to live is one thing, but knowing the cheapest, yet most in-demand parts of the country could really help you narrow down your search.

Fortunately, Spain’s leading property website Idealista has put together a list of the most ‘in demand’ municipalities of Spain and where you can find the most expensive and, more importantly for the house hunters among us, the cheapest municipalities of Spain to buy property.

It’s based on data from the last quarter of 2022 and is the average price of housing in towns with more than 1,300 sale announcements and costs valued at more than €1,100 per square metre. 

You can find the ten cheapest areas of Spain to buy property by average price below, but it’s worth noting that Idealista did these rankings by average price across the entire municipality, so there are likely individual towns and villages dotted around Spain where prices are significantly lower.

That said, this list gives you a good idea of the areas to look out for.

READ ALSO:  What will happen with property prices in Spain in 2023?

The 10 cheapest municipalities in Spain to buy property 

Santa Pola (Alicante) – Santa Pola, in the Alicante province, is the cheapest most in-demand municipality to buy a house, according to Idealista’s rankings. The average price for a house in Santa Pola costs just €151,796, though this may come as a surprise given its prime location in a foreign hotspot on the sought-after Costa Blanca. The main town of Santa Pola itself is a small beachfront community with a population of around 35,000. It also has a large foreign population and is a short drive or bus away from both Alicante and Elche.

Ourense (Galicia) – Next on the list is Ourense in Galicia where the average price is €154,941. The municipality is home to several towns and villages, surrounding the main medium-sized town of Ourense itself in southern Galicia. The town has a population of around 105,000 and is a little over an hour’s drive from both Santiago de Compostela and the coastal city of Pontevedra.

Oviedo (Asturias) – Third on the list is the municipality of Oviedo where you’ll pay an average of €154,968 for a property. Another area in northern Spain, the main city Oviedo itself, which is the capital of Asturias and has a population of 220,000. It sits between Cantabrian mountains and the Bay of Biscay. It’s known for its picturesque medieval old town and impressive architecture. 

Jerez de la Frontera (Cádiz) – Properties cost an average of €155,563 in the municipality of Jerez de la Frontera, or Jerez as it’s commonly referred to. It’s located in the Cádiz province of Andalusia and is a real piece of ‘traditional’ Spain. Jerez city is a decent-sized place with a little over 200,000 people and is known for horses, flamenco dancing and sherry, as well as the Alcázar de Jerez, an 11th-century fortress that harks back to Andalusia’s Moorish past.

READ ALSO: Is it better to buy or rent in Spain right now?

Torrevieja (Alicante) – Another municipality in Alicante and another incredibly popular with foreign homeowners. Properties here go for an average of €155,787. Torrevieja itself has a population of 82,000 and is another coastal town, but also has nature trails and salt plains nearby.

Murcia (Murcia) – Murcia is often overlooked, wedged between Alicante and Andalusia, but you could grab a bargain here with average prices of €157,119. Murcia capital is a bustling city of almost 450,000 people, and is strategically placed for trips to the Costa Blanca, Costa Calida, Costa del Sol, and Costa de Almeria.

Parla (Madrid) – The municipality of Parla lies just 20km south of Madrid and the town of the same name is home to 130,000 residents. It’s a great commuter area for those who work in Getafe or the capital. A house here costs an average of €160,652. 

Salamanca (Castilla y León) – The municipality of Salamanca surrounds the capital of Salamanca in Castilla y León in northwestern Spain. Buying a property in this area costs an average of €162,909. The main city of Salamanca is known for its university, which is the oldest in Spain and dates back to 1218. Understandably, much of Salamanca’s roughly 150,000 residents are students, which gives the town a lively atmosphere.

Burgos (Castilla y León) – Another northwestern Castilla y León municipality, is Burgos has around, where you can buy a house for just €163,164. The city of Burgos has around 180,000 inhabitants and is known for its medieval architecture and grand cathedral. 

Dos Hermanas (Sevilla) – The second most populous municipality in the province of Seville, properties cost an average of €163.274 here. The Andalusian town is just 15km south of Seville, making it great for commuters or those who want plenty of culture nearby. 

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