Home Mediterranean Properties Buying Guide.
The buying process in Spain has three (3) basic steps, which are:
Here we suggest to you a general guide of the buying process in Spain and general costs indications.
Each case is unique. We will provide you personalized information to guide you through the entire process of sale and will recommend you to some of our international legal advisors.
However in Home Mediterranean we offer you our Portfolio’s Services, which will help you to enter in contact with the more appropriate bank and financial companies.
We also recommend you cheerfully, to consult a private attorney, so you can fully be assisted on law changes that take place annually, in this way, you will be completely certain of the last update for each transaction.
In case you wish more information, please contact us through our Contact Form, or by phone: (34) 608 484 483 - (34) 635 690 577 or send an email to info@homemediterranean.com.
We are willing ro give you the necessary advice at any time.
1 - Purchasing Process
Steps 1 and 2 are optional, but our recommendation is to fulfill at least step 2 to guaranty the availability of the chosen property and its price while making administrative procedures.
1- Reservation
Once your offer has been accepted, a minimum deposit of € 3,000 will be required to take the property off the market while you proceed with the necessary documentation and set up financing of the purchase.
We need to draft the reservation document:
- Your personal information (copy of the DNI, NIE or Passport)
- Date of signing the Private Contract or Arras.
This reservation is subject to obtaining a mortgage or confirmation of such funding. The amount paid is fully refundable.
2- Private Contract or Arras
This point, apart from guaranteeing the availability of the chosen property is a firm commitment of the 2 parts on the purchase price of the property as well as general conditions. The seller then will make a 10% down payment of the total sale price.
This means:
- In case of withdrawal of the seller, this one will be under legal obligation to repay twice the amount paid as Purchase deposit.
- In case of withdrawal of the purchaser, this one will lose the entire amount paid so far.
Need
- Copy of passport or ID card
- For non-residents and foreigners: a copy of NIE
- Date of Notary
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3- Notary Deed
Requires physical presence or legal representation with power of attorney Deed. This is the official time in which you receive the keys of your new home.
The balance of the purchase price (selling price less payments made) and any other expenses paid by the owner and buyer, are made at this time.
A copy of the Notary Act (Deeds) is transmitted to the Tax Office and the Property Register to notify relevant taxes and expenses related to your new acquisition.
4- Purchase costs
General and total fees on buying real estate in Catalonia tend to vary between 10% to 12%. They include:
a)
Taxes - Finance
Value added tax (IVA). This tax is paid only for new built house and in case the seller is the promoter or builder. Its normal value is 9%, and is applicable on free properties and subsidized properties in the general scheme. The annexes to the property (storage rooms and garage) are taxed at 9% when purchased together with the property. If they are purchased separately, taxes will be rate on the standard of VAT (18%). The third car garage is also taxed at 18% regardless of whether they are purchased in together with the property or not.
Transfer tax (ITP). It is paid for the sale of any property on second and subsequent transmission, when the seller is an individual. It is of 9% and depends of the autonomous Community where the home is located.
Tax stamp duty (AJD). Only applies to free housing (which are not officially protected or public advocacy) and only in case the VAT is due (ie, to buy directly from the promoter or builder). The amount varies between 0.1% and 1%, depending on the Autonomous Community where the home is located.
b) Notary Costs
They are those produced by the intervention of the Notary in the act of sale. The amount is calculated based on the price of the property and applying a legally established rates. The notary may be chosen freely by the purchaser in the surroundings of the location of the property or of the tax residence of the applicant.
c) Registration fees
They correspond to the costs of registration in the Property Register. The amount depends on the value of the property and is computed by applying fees established by law. The registration is obligation.
In addition to those mandatory expenses you should take into account (as part of your individual and final decision) extra costs such as legal expenses (attorney). Those vary according to the advice required to the hired attorney.
2 - Annual costs
Local Taxes - Property tax IBI: Tax calculated on the ratable value of land and property established by the Tax Office. It is paid annually and varies according to the area where the property is located. An original copy must be presented, along with proof of payment of last bill, on completion.
Community fees: If the property belongs to a community of neighbors who share gardens, pool and common entrances, etc., Community fees charges will be determined by the Association set up with residents living in the complex. You have the right to attend neighborhood meetings or in your case be represented by an attorney.
Insurance: Covers damages in the inside of the house and its contents and liability insurance. We can help you by relating on various insurance companies.
3 - Mortgage
We cheerfully recommend you to consult on possible mortgage before you start seeking for any property. We do not provide funding but we will advise you on different options to get the best financing terms.
Different products are available in the market today and we will help you to decide which are most appropriate to your situation.
For non-residents in Spain, you should know that banks will provide 60% or 70% of the purchase. If you buy a plot, banks finance only 50%. |
