OUR GUIDE: BUYING PROPERTY IN COSTA BLANCA, SPAIN
This page is set out to give you some understanding on what to expect when buying a property in Spain. When setting your budget for your new purchase it is important that you build in the costs associated with buying a Spanish property, which currently equates to approx 13% of the selling price. Please find below a guide to the costs involved. It can be a daunting experience when buying in a foreign country but please be rest assured that Citrine Real Estate are here to help you every step of the way during the process in Spain.
Resale Purchase tax - When purchasing a resale property the buyer is required to pay the transfer tax which is currently 10%.
New-Build Purchase Tax (IVA) - 10% tax payable of the declared value as per the terms of the contract.
Stamp Duty - Payable when purchasing a new build property at around 1.5%.
Notary Fees - Preparing the Escritura, registering the title. (usually between €550-€900)
Land Registry Fees - To register the property at the relevant Land Registry Office. (usually between €150-€600)
Plus Valia - Tax levied by the Town Hall in accordance with Spanish Law. It is the vendor who is liable to pay this tax, however both parties are free to negotiate who pays it.
Additional Costs - You will have the fees from your lawyer and if you are taking out a mortgage you will also have these fees to pay. Please note that your costs will be higher when obtaining a mortgage and that you mortgage advisor will be able to give you a full breakdown of costs.
NIE - To buy a property as a non-resident in Spain you must obtain a fiscal identification number, known as an NIE number and open a local Spanish bank account
Notary - All property transactions in Spain must be approved by a registered Notary who are a legal representative of the Spanish government. It is only the Notaries who can register you as the rightful and legal owner of a property in Spain's Land Registry. They do this after witnessing the signing of the Escritura (the deeds) by both the buyer and the vendor and after ensuring that all associated and relevant taxes and payments have been paid.
Once you have found your dream home in the sun and the price has been agreed it is standard practice that a reservation contract is signed and the property secured with a reservation fee which is usually €3000-€5000. This fee forms part of the price paid for the property and here at Citrine we always recommend that where possible any fees/deposits are held by a lawyer and not an agent.
The next step is to draw up a contract which will give a completion date. This date will differ to suit different needs but if the completion date is going to be longer than 4 weeks then it is usual practice to make a further payment of around 10% of the purchase price as security.
During this period your independent lawyer will perform due diligence on your chosen property and Citrine Real Estate will liaise with the lawyers and notary who will draft the required paperwork. On the actual day of signing both parties and their lawyers will be present at the notary along with a representative from Citrine Real Estate. If there is a mortgage on the property then it is usual practise for a bank representative to also be present. It is here and at this stage that the remaining balance is paid.
Please take a look at our Trusted Professionals page to help you every step of the way with the purchase of your new place in the sun.