The purchase process in Spain

Buying a property in Spain

Wouldn't you love to make the glorious feel-good vibe of your summer holidays last all year? We all would. Think back to how happy you felt during your last holiday. Nothing beats the joy of relaxing on a beach at sunset, the excitement of stumbling upon a gem of a local restaurant or the fun of wandering through a colourful market. When you are on holiday, you are more relaxed, happy, spontaneous and more open to new experiences than you usually are. So why not thinking of owning your own place in the sun? The perfect investment to last your holiday feelings forever or to make a good return of your investment. The first steps on your way "home" starts right here.

Finally, the time has come to move your life to a better place. You are planning to buy your dream property in Spain. Most international property finders choosing property portals to find out what is on the market within their budget. INTERHOMES ONLINE is one of those portals where you can find properties for sale in Spain. Interhomes Online pre-selected professionals in real estate who value quality above quantity to ensure your property search will be in the right hands. Think Spain? Think Interhomes Online. We are 100% independent and only real estate orientated. Check online all offers, send an enquiry to the promoter, make a viewing appointment and hopefully you can come to a deal. Before you plan MOVING TO SPAIN read the information here.

Foreigners have the right to buy and resell all kinds of properties - residential, commercial or land, with no limits. Acquiring properties in Spain doesn´t automatically give one the right to live permanently in the country if the buyer isn´t an EU citizen, in the absence of a special agreement between the two states (Spain and the country of the buyer). But permission for permanent residence may be obtained by opening a bank account in a Spanish bank with not less than € 150,000, and owning a business in Spain. On these conditions, a Spanish VISA for the buyer and the members of his/her family is obtainable, which however does not give the right to work in the country.

When both parties have agreed on a price, you must ask for a proof which says that the seller owns the property and that it is free of charges. As a buyer, you are advised to check the deeds in the Registro de la Propriedad (Property Registry) and to check for any outstanding mortgages. Remember that in Spain, debts are charged to the property and any outstanding mortgage will be passed on to the buyer. A Nota Simple will confirm this. When all is well, the parties are advised to sign a preliminary contract, a Contrato privado de compraventa. When there is a mortgage on the property, the bank needs to approve the sale. In that case the bank will be taking part on the day when signing the deeds at the notary to take a bank draft from the amount of the mortgage. After this process, the notary makes sure you buy the property free of any debts.

You are then requested to pay a 10% of the purchase price as deposit. The estate agent or lawyer will hold these funds in a bonded client account. As a precaution, it would be wise to put your deposit into an escrow account, a blocked account where neither party can get at them until the sale is closed.

If you intend to raise finance for the purchase, make sure that the sales agreement has an arres agreement (i.e. a 10% deposit) and a date specified for completion. However, it is possible to sign the contract without such a deposit and while technically you have the right to sue a seller who subsequently withdraws, with an arres agreement in place you are entitled to twice your deposit as compensation if the seller decides to withdraw.

You pay the balance of the purchase price and all fees when you and the seller have signed the Escritura de compraventa, the definitive contract equivalent to the Deeds of the property. If you are buying a new property, you do not own the property until the work is completed, and you are in receipt of relevant certificates.

In Spain, the notary is a public official and is required to witness the deed of the sale. But getting expert, independent legal advice in addition to the notary is recommended to protect your own interests. The notary prepares the official contracts and makes sure they comply with Spanish regulations. The notary enters the sale on the local property registers (Registrio de las Propriedad) to protect against third party claims. If there is a common ownership, a Community of Owners must be established through which community charges can be shared. If your property is in an apartment block then the situation relating to the Horizontal Division should be clear, especially in new developments.

The transaction is normally completed between 2 up to 12 weeks. Read HERE MORE ABOUT BUYING A PROPERTY IN SPAIN.

Do you need a mortgage?

If you need a mortgage from the bank it makes things a bit more complicated. In Spain non-residents receive up to 70% and residents up to 80%, from the valuation price given by the bank to the property you want to buy. The bank will obligate you after you agreed on a price with the sellers and the agencies involved to do a valuation by a company approved by the bank where you are planning to take the mortgage from. Be aware that those companies work in advantage for the bank and the bank just need to lower their risks. Not only as it is the banks policy, but by law the banks need to give a lower valuation than the true valuation. In most cases the final bank valuation of the property will be lower than the agreed purchase price between you and the vendor. In that case you get a lower amount as mortgage and you need to invest more own money. We advise any buyer never to pay any reservation fee, or 10% deposit before you are sure what the bank will give you as loan. Sometimes agencies can present you the property as unique and one of a kind and will ask you to reserve already while the bank is calculating your mortgage amount. But if you find out later that the loan is not enough to cover your purchase you lost your reservation fee. Via Interhomes Online we connect you with professionals only who are aware or should be aware of these facts. If you have any conflict with an agency, contact us for legal help and assistance. The banks valuation need to be paid by the buyer and will cost in Spain about 1500 Euro excluding IVA.

If you need a mortgage before purchasing it can take up to 6 months before the bank has approved you the requested mortgage. It all depends about your nationality, age, paperwork, your income and the property you are planning to purchase. For more information according mortgages or the legal process to buy a property in Spain visit the website of one of our partners SUN LAWYERS

Find your way home!