Buying a Property in Spain

In our opinion, given the relative high cost of purchasing any kind of property, the associated taxes, as well as the impact of any kind of mistake, the purchase process requires full attention to detail and dedication.

Define what you want

Do you know what you really want? Do the other members of your family unit share these values? Can you define the search variables for your dream property in detail?

Having a clear definition of the property we are looking for helps save both time and money, and avoids unneccesary complications during the rest of the purchase process.

We advice you to :

• Define what you are going to use your property for (primary housing, vacation, office, secondary housing, investment etc)
• Define your budget (including costs & taxes) and the financing (interest rate, term, interest type)
• Define search areas, in other words, in which province, city, area and if possible even building, community or urbanization (also think of the surroundings, and decide if you need to live near work, a school, a hospital, nature, the beach, golf courses, center of town etc)
• Define the kind of property (size, rooms, facilities, layout, quality etc)

Once we have managed to define the search parameters in the most precise way possible, the search in itself can start.

With or without a Real Estate Agent?

Now that you know what kind of property you want, where and at what maximum price, you should consider if we want a Real Estate Agent to find it for you, or if you want to contact directly with the owner. Using a Real Estate Agent means paying their commission, aproximately 5% of the sales price of the property, an important sum. In our opinion, it is important to know beforehand what additional value the Real Estate Agent will bring to the purchase, to be able to evaluate if it is worth the while using one.

It is also important to understand that the Real Estate Agent is interested in selling above all, it is really not that important what a client buys, as long as he buys. A Real Estate Agent is not a neutral party in a purchase.

Finding a property without a Real Estate Agent can be done by searches on the internet, or directly in the areas where you are interested in acquiring a property.

Having found the property

If you have found a property that interests you, some Real Estate Agents insist that you sign a "reservation" contract, which supposedly makes the sellers take the property off the market. Under no circumstances can we recommend signing a contract of this kind, since it in many cases forces you to accept the clauses in a purchase contract that you have not even seen yet!

It is preferable to sign the purchase title deed directly in the notary, or in case this is not possible, because of time constraints or other reasons, sign a purchase contract, with all conditions clearly outlined until the signature of the title deed.

In case of signing a purchase contract, it is very important to clearly understand all clauses and the consequences of the same BEFORE you sign.

After finding a property you are interested in, we recommend you ALWAYS ASK FOR A SECOND OPINION. This could be from e-consejo through our reports, or it can be from a third party with sufficient knowledge. Make sure that the person that gives the second opinion is NEUTRAL, and that they have no relation to the result of the operation.

We recommend you ALWAYS check :

• The structural state of the property
• The general state of the property
• The juridical state of the property (if it has charges or encumbrances, embargoes or servitutes)
• That previous taxes (associated with the property) have been paid
• That there is no debt to the Community of Property Owners – ask the seller for a certificate from the Community
• That the municipal taxes have been paid - ask the seller for a certificate from the Town Hall
• That all electricity, water, gas, telephone and other services have been paid
• The energy efficiency certificate

If you have the possibility to study the previous title deed we recommend you do so.

In case that the property is new, straight from the promotor, it is also very important to check :

• That the first occupation licence is in order
• That the property is correctly inscribed in the Property Register
• What the percentage of participation in the Community of Property Owners implies
• That the ten-year insurance policy is in order

If you are financing your purchase it is important to understand all the conditions of the mortgage title deed. It may seem exaggerated, but if you have time or are not sure we also recommend you examine the Town Hall Planning documentation for the area, so that you can be sure that no highways are planned on the prospective property, or any other unknown and negative urbanistic change.

And of course, if you are going to proceed, understand all clauses and stipulations of the purchase title deed.

Once the purchase is made and the corresponding title deed has been signed, it is important to pay the corresponding taxes within the stipulated time to avoid penalties. Finally, to register the title deed in your name in the Property Register.

Don´t forget to change the ownership information in the Town Hall, as well as electric and water contracts.

Do you want to keep everything under control, or do it by yourself?

Download our checklist here : Checklist for purchasing property in Spain.pdf