Buying or selling a property in Spain.

Buying or selling a property in Spain could be hugely different to the same process  in the United Kingdom and this is the reason why, we would be happy to provide you with a brief letter with some points that may be of interest for you.

Firstly, it is mandatory to know that you must have an NIE number. This is the Spanish tax identification number for non-resident citizens regardless their nationality and it is required to carry out most of the economic transactions here.

Secondly, the first step to be taken during the purchase process would be to block the property so it is not in the market anymore.

For this purpose, the common practice is to leave a deposit supported with a reservation contract, which could vary depending on the purchase price and it´s deposited in a lawyer´s client account in order to provide reassurance and strength to the transaction.

Which are the legal checks?

Thirdly, this reservation contract is normally subject to legal searches so your lawyer can do the appropriate “due diligence” from that moment until the completion date. These checks should include:

• The legal condition of the property.

• Prepare draft and sign the necessary contracts with the vendor side.

• That the property is free of debts, charges and encumbrances.

• That utilities are up to date or ready to be connected.

• That the property has all necessary planning permissions and licenses.

* At the reservation contract you will also establish the guidelines of the transaction in terms of dates and following payments.

Fourthly, once the buyer and the vendor are ready to proceed, your lawyer will prepare the purchase deed to be signed on your behalf on completion. This will be done before a Notary Public and your lawyer can do it on your behalf if you have granted power of attorney to him / her. At the signing, the balance of the purchase price will be paid to the vendor and the vendor will hand over the keys.

Fifthly, after the signing, you will become the new owner of the property and your lawyer will work to make sure that everything is in order by:
Paying Transfer Tax.
• Registering your ownership in both Town Hall and Land Registry.
• Opening a Spanish bank account for you.
• Setting up direct debits for the payment of utilities, Community of Owners’ fees and Council Tax.

How much is the cost?

• The Transfer Tax rated at 7 % depending on the purchase price or VAT rated at 10 % and Stamp Duty rated at 1.2 %.

* Please note that these taxes could vary depending on the region.

• The Transfer Tax for plots of land is of the 21% VAT plus the 1.2% Stamp Duty.

• Legal Fees, normally a 1% of the price, however this would have to be agreed between client and lawyer.

• Notary fees.

• Land Registry fees.

In conclusion, in order to get an approximate idea, the expenses usually range between 9 and 13% of the purchase price.

Last but not least, please bear in mind that all these procedures can be done by your lawyer if you are not planning to be in Spain during the process by granting power of attorney.

Do you have any further questions? Contact us and we will be happy to answer them.

«What are you waiting to buy or sell your property?»

Contact us and we will help you with it.