What is the best strategy to find the perfect property for me?
1 - Be clear where you want to purchase. It advisable to get known the area first, without viewing properties so that you can decide on this most important issue independently.
2 - Be sure of your maximum budget considering all possibilities (mortgages, additional purchase costs etc.). Once decided, stay with your budget.
3 - Think about the size of the property you want. How many bedrooms will be needed?
4 - Property situation. Think about the situation you would like to have. Rural, in town, close to beach etc. consider the advantages and disadvantages of the different situations and decide which would be best for you.
5 - Instead of searching thousands of websites, seek help from your re-d broker. Give him/her as much information as possible and he/she will recommend properties to you. If the recommendations are not what you want, give your broker feedback. This helps him/her search more effectively for you.
Category: How to find the best property for me?
What are the mostly made mistakes searching for a property in Spain?
1 - To be unsure what you actually want. If you start viewing without certain limits you will end up with a never ending property hunt.
2 - Too many viewing on one day. It does not make sense to view more than 3 or 4 properties a day. Rather spend time to find out as much as possible in advance and only view the properties that are really interesting.
3 - Hesitating or being unprepared. If you find your perfect home you should not hesitate or loose time for things which you could have done in advance. The best houses are not long on the market. Be prepared with your documents and money to reserve the property with a deposit payment to the owner (contrato de arras).
4 - Don't combine holidays and property searching. Property searching abroad is a time consuming and stressful task. Concentrate on it and don't try to combine it with your leisure time to get your dream property.
Category: How to find the best property for me?
How long does a normal search usually take?
Of course, if you are lucky you will find your perfect home right away. But be prepared for your search to last a couple of months. Consider travelling to Spain as often as possible. At least 3 or 4 week-ends will be necessary for viewings but consider that most agencies don't offer viewings on Sundays. After you have found a property and made a decision to purchase, you will need to come also for the notary signing. Our clients are searching for properties, for usually at least 3 months and up to 2 years.
Category: How to find the best property for me?
How can I find properties on the re-d website?
There are several search functions on our website. While searching you will find on the left side of the webpage filter possibilities after type, living area etc. Use them to reduce the property list to the offers that are interesting for you. If you search for a certain location, please check also our property sitemap which lists all locations where we offer properties. However, our aim is to advise you in the best way possible personally via our staff, so don't hesitate to contact the re-d broker who is responsible for the area. Your broker will be happy to help you in your search and recommend certain properties that fit your needs. The re-d brokers contact details are shown in each of our property descriptions.
Category: How to find the best property for me?
How do I get help from re-d brokers?
Whenever you use our enquiry forms or contact possibilities on our website your re-d broker will get an email. We try to respond within two working days. If it is urgent or you don't get response, don't hesitate to call your broker directly. The re-d brokers contact details are shown in each of our property descriptions.
Sometimes our email responses get lost in email spam filters. If you still have problems contacting your broker you can also contact our main office in Barcelona where our staff will help you as soon as possible.
What documents do I need to purchase a property in Spain?
The most important document is the Spanish NIE number (numero de identidad de extranjeros) as your identification number in Spain. It is obligatory to have a NIE number if you want to purchase or sell property in Spain. This goes for all owners and co-owners of a property. You can apply for your NIE number in Spanish embassies or in Spain directly. Download here a form which you can use for the application. The application is free but takes time, at least 4-5 weeks. If you need help don't hesitate to ask your re-d broker.
Whenever you start your property search take care of the NIE number because you will need it anyway. In addition you will also need your passport for a property purchase.
Furthermore you need a Spanish bank account as you can only pay for the property by Spanish bank confirmed cheques. An account is also useful to pay taxes, for example the ground tax IBI.
Category: Buying procedure
How long does it take to get an NIE?
The application takes time, at least 4-5 weeks. Download here a form which you can use for the application.
If you need help with this don't hesitate to ask your re-d broker.
Category: Buying procedure
Do I need to be Spanish resident?
It's not necessary to become a Spanish resident to buy a property. There are no restrictions for foreigners who wish to buy in Spain.
Category: Buying procedure
What are the next steps when I decide to buy a certain property?
1 - The usual process is that you will be asked to sign a pre-contract, in Spanish contrato de arras. It includes a deposit payment to the owner, normally 10% of the purchase price and will reserve the property for you as the owner cannot sell it to somebody else for a certain time period (1 - 6 months).
2 - In the contracted time period we will check and prepare all papers for the final notary date which is the official purchase date. In this period you also have time to negotiate with banks if you need a mortgage.
3 - On the agreed notary date the official purchase happens and the new property title deed will be written, the Escritura de compra-venta and the remainder of the purchase price has to be paid by a bank confirmed cheque. After that the notary takes care of registering the property in your name in the Spanish land registry (registro de la propriedad). With the Escritura you are officially the owner of your new home.
Category: Buying procedure
In what kind of contracts will I be involved?
You will be involved in a pre-contract, in Spanish contrato de arras. It includes a deposit payment to the owner, normally 10% of the purchase price and will reserve the property for you as the owner cannot sell it somebody else for a certain time period (1 - 6 months).
In addition you will be involved in the Escritura de compra-venta which the notary prepares and which is the official property title deed.
Category: Buying procedure
How long does it take from the purchase decision till the property transfer?
This depends both on you and the seller. Normally the time period between decision and purchase is 1-3 months. Keep in mind that you need time to transfer money to Spain and, if you need a mortgage, the banks need time to value the property. If you already have your money in Spain and the property is vacant, we can go to the notary one week after the decision.
Category: Buying procedure
How do I pay a property in Spain?
Normally you will pay a deposit of 10% to the owner which you can do by bank transfer or in cash. The remainder of the purchase price will be paid as a Spanish bank confirmed cheque. For that you will need a Spanish bank account. The notaries don't accept any other form of payment.
Category: Buying procedure
How can I be sure that everything is legal regarding a property?
There are three important issues regarding the legality of a property sale in Spain:
1 - Is the owner who is offering it the real owner
2 - Are there debts on the property which the owner wants to hide
3 - Is the property registered in Spain as the owner offers it (for example registered square meters etc.)
On our website we offer our properties on the basis of information given by the owners and our collaborating agents. But as soon as you are seriously interested in a certain property we will check the actual ownership, debts like mortgages and taxes and the legality of the buildings of this property in the Spanish land registry. We usually include a property data sheet of the registry, which shows all relevant information for the pre-contracts. It is called the nota simple.
In addition the notaries in Spain are obliged by law to check and control this information precisely for the notary and purchase date.
Category: Buying procedure
How do I make sure there are no debts on a property?
As soon as you are seriously interested in a certain property we will check the actual ownership, debts like mortgages, taxes and the legality of the buildings of this property in the Spanish land registry. We usually include a property data sheet of the registry, which shows all the relevant information for the pre-contracts. It is called the nota simple.
In addition the notaries in Spain are obliged by law to check and control this information precisely for the notary and purchase date.
Category: Buying procedure
What is the Valencia land grab law and does it apply here?
The Valencia law LRAU from 1994 allowed the town halls to expropriate rural land in some cases where the owners can't pay for their urbanisation (water, electricity, telephone connections and roads). The law was changed in January 2006 to a new one, called LUV, which makes it a lot more difficult to expropriate land. Also the new law applies only to buyers of rural land in Valencia. In this case we recommend taking advice from a solicitor.
Category: Buying procedure
Do I need a lawyer?
In general it is not necessary because the notary is obliged by law to check and inform about the important issues. However, if you feel unsure or there are problems in the documents of the property you can hire one to get help in the buying process. To obtain the most objective advise, take care that your lawyer is only lawyer and not also working as an estate agent.
Category: Buying procedure
Taxes and additional costs regarding a sale/purchase
What taxes and fees do I pay as a Buyer? When and how to pay?
On the notary date:
1 - the property transfer tax ITP of 7% of the purchase price. In case of a newly built property which you buy from a construction company you don't pay ITP but IVA. IVA for houses and apartments is normally also 7%.
2 - the notary costs which include the escritura, registration etc. This differs between 0,5% to 1,5% of the purchase price.
If you include things like bank costs, mortgage opening commission and legal advice you can calculate 10% in addition to the purchase price.
Annual taxes:
Owners of houses have to pay the ground tax IBI which varies from townhall and type of land (rural or urban).
If you have rental income due to your property you need to pay also normal Spanish income tax, renta.
Category: Taxes and additional costs regarding a sale/purchase
What taxes do I pay as a Seller and when and how to pay?
1 - The Plusvalía which is a municipal tax on the increase in value of the land of a property (not the buildings). The basis of calculation is the value of the land in the Catastro (land registry office). The values in the Catastro are usually quite low and not comparable with market prices. Depending on each municipality the tax differs between 16% and 30% on the increase in value.
2 - The capital gains tax in Spain is 18% for residents or non-residents and you pay it with normal tax declaration (renta). There are exceptions and possibilities to reduce this tax. It is recommendable to involve a tax consultant for this.
Very often non residents don't declare their taxes in Spain at all and after a sale the fiscal office can't reach them any more. That is why non residents pay on the notary day a so called retención of 3% of the purchase price. This is treated like a deposit which the Spanish retains in case the seller does not, in future, declare his/her renta. A paid retención can be calculated into the renta declaration.
Category: Taxes and additional costs regarding a sale/purchase
Do I need to declare a sale in my tax declaration in my home country?
This depends on each country but normally Spain has double taxation agreements with EU countries. That means yes, you also need to declare your gain in your home country but you should not pay more capital gains tax because of that. Since there are different agreements for each country it is recommended that you involve a tax consultant for this.
Category: Taxes and additional costs regarding a sale/purchase
What is the difference between rural and urban land regarding building restrictions?
Rural land:
Fincas and Masias are located in rural areas and usually have a large amount of land. This land is classified as "rustico" which means there are special regulations regarding building on the land. The regulations vary from province to province and each town hall has its own guidelines. On Mallorca for example town halls usually allow a building when the plot has more then 15.000m2, in Catalonia you can only rebuild the existing m2 of a ruin.
Urban land:
Land classified as "urbano" is building land. Each town hall has its own development plan which advises the surface and height you can build on your land.
Category: Building and restoring projects
Do I need a license to restore a property?
Yes, you need a license to restore your property. It can be applied for at the townhall with plans from an architect and the respective land registry maps.
3 - To build your property legally you need a registered architect who applies for the planning permission. He is the highest supervisor on the building site and writes the "final de obra" (final acceptance) when the building is finished. The final acceptance is necessary to register the new building at the town hall and in the property register.
The second person required is the "Aparejador", an engineer who takes care of the structural engineering and the daily progress on the site. Furthermore he writes a technical project which has to be attached to the plans of the architect to get the planning permission. The third person is your builder. He has to comply with the regulations of the project and is responsible for the quality of his work.
Category: Building and restoring projects
How can I calculate the costs?
The average construction price of a Spanish property ranges from € 700 to € 900 per m2. It is entirely possible to spend more or less than this although these figures are an accurate reflection of the cost/quality balance that most are seeking. Usually the quality of the primary components (structural, services and general installation) does not greatly influence the building cost. However, secondary components (building finishes, special details and decorative elements) do cause substantial price variation. Typically, owners tend to spend an additional 25% to 50% of the amount spent on internal spaces on the immediate environs of the house.
Total project costs for building restoration are in keeping with new build costs. Restoration costs are typically lower than new build costs by approximately the cost of acquiring the initial property. The example below is based on € 500/m2.
Price example:
Initial purchase of a 150m2 house with courtyard = € 62,000
Ca. 10% additional purchase costs for tax and notary = € 6,200
Restoration costs of home (150m2 x € 500) = € 75,000
External spaces @ 35% of amount spent on home = € 25,000
Total Cost = € 168,200
Category: Building and restoring projects
How long does such a project take?
Regarding timescale I would estimate for a restoration project about 1 year from the very beginning until moving in. You can divide the year into three phases:
3 months - Design and cost estimation
2 months - Planning Permission, Building Regulations and Contracts.
7 months - Construction
Category: Building and restoring projects
Where can I find help regarding such a project?
The best way to start is to find a good architect. This architect has to be registered at the official architects college of Spain. Please ask your re-d broker for useful contacts.
Usually we recommend choosing a Spanish one because they give you better terms and you will need a Spanish bank account for the purchase anyway. However, if you have a good relationship with your English bank it is worth asking them of course too. Ask your broker about Spanish banks available in the area where you want to purchase.
Category: Money / Mortgages
How do I transfer money to Spain?
Within the EU transferring money has become quite easy with the European BIC system. Ask your bank for your IBAN account number. An IBAN transfer is cheap and fast.
Category: Money / Mortgages
How do I exchange money to Euros?
If your home bank is charging too high a commission there are several companies offering cheaper money exchange and transfer especially from the UK to Spain. If interested please ask us for a list so you can compare the rates.
Category: Money / Mortgages
Where and how do I get a mortgage?
Depending on your personal financial situation either English or Spanish banks will offer you mortgages. Usually we recommend choosing a Spanish one because they give you better terms and you will need a Spanish bank account for the purchase anyway. However, if you have a good relationship with your English bank it is worth asking them of course too. Ask your broker about Spanish banks available in the area where you want to purchase.
All banks usually finance up to 80% of the purchase price as well as the restoration project. However if you are looking for a rural property where the land is declared rural (Spanish "rustico") they might only give you half of that so 40%. But in case of a townhouse in a village whose land is declared urban (Spanish "urbano") you will get 80%. The rates are very different depending on your individual needs but they usually start at 3.65% with a duration of 30 years.
Category: Money / Mortgages
What is the procedure for getting a mortgage for a Spanish property?
When you have decided on a bank, they will ask you for your last pay slips, your income tax declaration, passport, NIE number and any other income or asset proofs. If everything is alright, they will send an independent valuer to the property who writes a dossier and estimates the price. When the valuation is ready and all your documents approved, it is time to go to the notary where the bank lends you the money for your house. The notary sets up 2 official title deeds, the purchase and the mortgage. Both transfers will be registered in the property register.
The whole process takes normally between 4 and 8 weeks.
How do I change the contracts of services like phone, electricity and water?
This is part of the re-d after sales service, your broker will be happy to do that for you.
Category: After the sale
What running taxes and fees do I need to pay as property owner?
1 - The ground tax, in Spanish Impuesto de bienes inmuebles, called IBI. The IBI varies depending if the land is rural or urban and in which town.
2 - If you are an owner of an apartment or urbanisation of houses with communal areas, you'll have to pay your part of the community costs.
3 - Electricity, water, gas and telephone depending on your consume.
4 - It's recommended that you get insurance for your home in Spain which covers damages from water for example, robbery etc. Usually Spanish banks offer house insurances, the costs are around 200€ per year depending on the size and equipment.
Category: After the sale
How do I rent my property?
We recommend leaving this in the hands of professional renting agencies, please ask your re-d broker for contacts.
Category: After the sale
What taxes do I need to pay for renting out my property in Spain?
You have to declare your gain from the renting in your annual Spanish tax declaration. It's recommended that you get help from a tax consultant in this case.
Category: After the sale
Should I make a Spanish will?
Yes. A will signed at a Spanish notary will help to transfer the property the heirs more quickly.
I you have already decided who will inherit your property then it is recommended to transfer it at a notary before to save inheritance tax.
NIE Numero de identidad de extranjeros: Spanish identification and personal tax number for foreigners
Category: Terms – What is?
Escritura de Compra-Venta
Official property title deed and purchase/sale contract.
Category: Terms – What is?
Contrato de arras
Option contract, deposit contract. Fixes the price of the property, the time period within the notary date shall be, the conditions etc.
Category: Terms – What is?
Nota simple
Property register sheet, shows actual owners, description of the property and possible debts.
Category: Terms – What is?
Licencia de obra
Planning permission
Category: Terms – What is?
Declaracion de obra nueva
Declaration of new building in a Escritura at the notary
Category: Terms – What is?
Cedula de habitilidad
Certificate that the property is habitable, sometimes asked by banks or electricity supply company.
Category: Terms – What is?
ITP
Impuesto de transmisiones patrimoniales, property transfer tax.
Category: Terms – What is?
IVA
Impuesto sobre el valor añadido, Value Added Tax VAT.
Category: Terms – What is?
IBI
Impuesto sobre los bienes inmuebles, property ground tax.
Category: Terms – What is?
Plusvalía
Municipal tax on the increase in value of the land of a property. To be paid by the owner after the sale.
Category: Terms – What is?
Renta
Income
Category: Terms – What is?
Residentes / Non-Residentes
Residents and Non-Residents. Important regarding tax and financial issues.
Category: Terms – What is?
Patrimonio
Asset
Category: Terms – What is?
Registro de la propriedad
Property register
Category: Terms – What is?
Catastro
Land registry or mapping office
Category: Terms – What is?
Retención
Non resident sellers pay on the notary day a so called retención of 3% of the purchase price. This is a deposit which the buyer has to pay to the fiscal authorities in the name of the sellers to cover your taxes from the gain in sale price.
Category: Terms – What is?
All information given without warranty. Is there any question not answered or have you found any wrong or out of date information? Please help us and contact us with your comments.
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