1) Hire a lawyer
Even though hiring a lawyer or the equivalent of a solicitor is not mandatory in Spain, it’s a good idea to have someone who understands the process and can walk you through it. This is particularly important if you’re buying as a non-resident, but residents who aren’t fluent in Spanish or who are buying property for the first time, may want to as well. Your Spanish seller may find this strange, as it’s not typical for them, but it’s better to be safe.
READ ALSO: What’s the difference between a gestor, a lawyer and a notary in Spain?
2) If you are buying as non-resident – apply for an NIE number and open a bank account
If you don’t live in Spain usually and are buying a property as a non-resident for use as a holiday home for example, then there are several extra steps you’ll have to take, that residents will have already done. This includes applying for a foreign identity number or NIE. Your lawyer can help you do this. You will also need to open up a Spanish bank account, so you can pay associated fees such as utility bills etc.
READ ALSO: 14 things you should know about Spain's NIE number for foreigners
3) Find out what charges are associated with the property
Once you have found a property you like, you will need to check a few things before making an offer on it. One of these is to find out if the property has any charges associated with it. If these are not sorted beforehand, then you could get lumped with them. Check if there’s any debt for example, if it has a mortgage and if there are any limitations imposed on it by the owners’ association. For example, some buildings may not allow you rent out and say that only owners must live there. You can request what’s called a nota simple directly from the property registry or through a notary office in order to find out.
READ ALSO: What is the 'nota simple' and why is it so important?
4) Find out how much mortgage you will be granted
If you need to buy the home with a mortgage then you’ll need to know what budget you have before you can put in an offer. This means contacting various banks to find out what they can offer you. In order to grant you a mortgage, the bank will also need to carry out a valuation on the property.
READ ALSO: What will happen to mortgages in Spain in 2024?
5) Get a surveyor to look over the building
Again, this is a step that many Spanish buyers don’t bother with, but it’s important for peace of mind to find out what state the property is in. This is particularly important for rural older houses or ones that you’re buying off plan. This will help you find out if there’s any issues or structural problems. Based on the report, you may not want to make an offer at all or you may want to put in a lower one, taking into consideration repair costs involved.
READ ALSO: What's the process for buying a property in Spain?
6) Make sure you have extra for expenses
If you’re buying the property outright and aren’t getting a mortgage, it’s important to remember that you’ll need quite a bit extra on top of the sales prices. In fact, you’ll need an extra 10 percent for notary fees, Property Transfer Tax, the Property Registry and any possible real estate agency fees.
7) Find out what the community fees are
If the property is an apartment in a larger building or is in a gated community for example, there will typically be monthly community fees that you’ll have to pay. This will be for upkeep of the communal areas, to put into a contingency pot for any possible repairs and to pay for building caretakers if necessary.
READ ALSO: 'La comunidad': What property owners in Spain need to know about homeowners’ associations
8) Put in your offer and negotiate
Once you’ve found out all of the above, you’ll know how much you can afford to pay for the property and can put in an offer. Don’t forget, like in other countries you can negotiate and don’t have to pay the full asking price.
READ MORE: How and when can you negotiate the price of property in Spain?
9) Sign a reservation contract and pay a deposit
If your offer is accepted, you will need to sign what’s known as a reservation contract and pay a small fee in order to save the property for you. You will pay this to the estate agent, who will typically ask for around €3,000, or more for more expensive properties. Keep in mind this is a non-refundable deposit, so you need to be sure you want this one. Once signed, the seller agrees to save the property for you for 30 days. If you go ahead and complete and buy the house, the deposit will be included in the sales price, but if you pull out, then you lose it.
10) Sign the arras contract
The next step is to sign another contract, known as the contrato de arras. This requires you to put down 10 percent of the agreed price of the property straight away. It acts as a type of guarantee to ensure that it’s not as easy to pull out of the agreement as it is in some other countries. If you pull out of the contract for whatever reason, then the seller will get to keep your 10 percent, but if they pull out or don’t have all their paperwork in order by the time you sign the deeds, they will have to pay you 20 percent. In both cases, one party walks away with the money and there is no more negotiation. If for example the seller doesn’t have everything in order by the time the deadline comes around, but you still want to buy the property, you can agree to continue and they won’t have to pay the 20 percent.
11) Sign the deed in front of a public notary
Around a month or a little longer after you have signed the arras contract, you and the seller will have to appear in front of a public notary together to sign the deeds. The notary will read out the full contract, which will include for example what is staying in the property such as ovens and light fixtures. This is typically only in Spanish, so it’s important you bring your English-speaking lawyer with you to explain everything and translate. Once you have both signed and you have handed over the money, the seller will give you the keys right then and there.
12) Register the house under your name
Even though you’ve signed the deeds, the property is not actually officially yours until your lawyer lodges the information at the land registry and it’s transferred into your name. This may take one to two months after signing with the notary.
13) Pay the associated purchase charges and property taxes
In order to complete everything, you will also have to pay further fees and taxes on top of paying for the property, this includes notary fees, land registry fees and Property Transfer Tax or (ITP). This is typically between six to 11 percent of the purchase price.
READ ALSO: How to avoid paying Spain's ITP tax when buying a second-hand home
14) Put the utilities in your name
When everything has been legally sorted and the property is yours, you’ll need to change the utilities over to your name. This means finding out which companies already supply electricity, gas and water etc and contacting them to change the name and bank details over. If you don’t want to go with the same companies, you can also choose different once to sign with.
READ ALSO: How to change the title holder of utility bills in Spain
15) Register on the padrón or change your padrón certificate
If you are moving to Spain for the first time you will have to register on your town hall census called the padrón. If you already live here, you will need to apply for a new certificate detailing your new address. This certificate will be necessary in order to apply for several other documents you may need while living here.
Comments (1)