Buying in Spain
Viewing…
Hallewell Estates can offer you an informative, friendly inspection visit with our experienced sales personnel. We don’t believe in the “hard sell” approach and will only show you the properties that appeal to you and that are within your price range.
Not only will you be able to view the luxury properties we have to offer, but you will also get to see the areas which interest you – whether it be the picturesque mountain scenery, traditional Spanish villages and vast olive groves in the North or the cosmopolitan towns, excellent restaurants and bustling night life in the south. We can show you all of what the Costa Blanca has to offer and which area would suit your individual needs.
Procedure…
During your viewing, if you decide to purchase a property, a private purchase contract (Contrato de Compra-Venta) is made between yourself and the vendor. Upon the signing of this contract a deposit must be paid to secure the property and price, this will insure that the purchase price is fixed until completion. A personalized payment schedule will be arranged with the vendor to suit your individual needs where possible. However, the normal payment schedules are as follows:
For the purchase of a new property the payment schedule would normally be as follows. A deposit of €3000 will be required to secure the reservation. Approximately 40-50% of the purchase price will be required within 90 days. The outstanding balance would normally be paid upon completion. Some vendors will need a intermediate payment before completion.
For the purchase of a resale property the payment schedule is slightly different. A holding deposit of €3000 will be required to secure a reservation. Within 30 days, 10% of the balance will be paid. The final balance, including all taxes, will usually be paid approximately 2 months later (this time factor can sometimes be negotiable depending on circumstances).
Once your property is completed, a date will be arranged for the signing of the official title deed (Escritura Publica de Compra-Venta) this official document will be prepared by a Spanish Public Notary (Notario) and signed by both the purchaser and vendor. Whilst the original Title deed is sent to the Spanish Land Registry for inscription in the register, you will be provided with a temporary copy (copia simple) this document is proof of ownership and will enable you to resell the property if you wish.
Hallewell Estates can offer discounted furniture prices and specialised “furniture packs” whether it be for a holiday home or permanent living. If you need assistance with moving furniture over here to Spain we have an association with a reliable and reputable removal company. We also have contacts with car and boat suppliers on the Costa Blanca.
Finance…
We can offer English Speaking solicitors (abogados) who will assist you with all legal matters throughout your purchase. We can also recommend numerous banks and assist you with opening bank accounts and arranging mortgages if required. As in England, when applying for a mortgage, proof of income is required, such as P60’s, payslips or certified accounts if self employed.
Hallewell Estates has teamed up with specialist currency brokers based in the UK and Spain. They will advise you on buying Euros and due to the fluctuating value of the Euro it can have a dramatic effect on the final cost of your property.
To calculate the approximate additional costs of the purchase price, a guideline figure of around 10% should be added. This would include Spanish IVA (VAT) at 7%, legal and notary fees and water and electricity connection. To provide a figure for approximate annual running costs you should assume this will be around 1 – 2 % of the purchase price. This would include the community charges, local taxes, rates, house and contents insurance, fiscal representation and standing charges for water and electricity.
Example of additional costs associated with purchase…
| A buying price of €225,000 (£150,000) is used for this example. | ||
| € – Euros | £ – Sterling | |
| IVA 7% (Spanish VAT) – Payable on the declared value of a new property or 7% Transmission Tax on a resale property (Impuestos de Transmisiones Patrimoniales) | €15,750 | £10,500 |
| Legal Fees – Making searches, preparation of the Escritura (title deeds) and translation before a Public Notary. | €2,250 | £1,500 |
| Notary Fees – Preparing the Escritura, registering the title and stamp duty. | €2,000 | £1,333 |
| Connection charges – Water, electricity etc. | €1,500 | £1,000 |
| Plus Valia – Capital Gains Tax levied by the Town Hall on the increase of the value of the plot since last sold. (On resales, variations may occur depending on last sale) | €150 | £100 |
| TOTAL | €21,650 | £14,433 |
“All costs are estimates and for guidance only. Sterling prices on this list are based on an exchange rate of €1.50 to £1 and are liable to fluctuation.”
“If you decide to arrange a mortgage there will be additional set up fees and the Notary fees will increase.”
“Connection charges for water and electric vary along the Costa Blanca.”
Selling your property…
You may pay Capital Gains Tax on the sale of your property. The current rate is 35% and is applied to the profit you make on the sale. This liability, however, may be reduced by effecting certain allowances. If you are not a resident in Spain when you sell your property, the Spanish Tax Authority (Hacienda) will retain 5% of the sale price until they have ascertained that all taxes have been paid. This retention will be released to you through your lawyer once the process has been completed. If you are a Spanish resident holding a valid Residence Permit the above will not apply.
It is recommended that you discuss your Spanish Will and Inheritance tax with your Spanish legal representative.
There are no restrictions on removing money from Spain provided that all taxes have been paid.