Buying process
Would you like to buy the house of your
dreams in Spain? It’s a good idea, many foreign
people have done this and they are very content with
where they now live. But some of them have had bad experiences
in the process.
In Spain, only estate agents with ‘Agentes
de la Propiedad Inmobiliaria’ (API) accreditation
are recognised by the Ministerio de Fomento (The Spanish
Government department that monitors and controls these
types of businesses)
To obtain API accreditation you must have
(an appropriate) university degree and have passed an
examination set by the Ministerio de Fomento. This regulation
dates from 1969, it conforms to the Constitution set
by the Constitutional Tribunal of the API.
AIRMAR recommend that you do not pay fees
or commissions to people or agencies without API accreditation
for mediation in the sale and purchase or the rental
of properties.
AIRMAR is an estate agency that is licensed
and qualified to assist you through the whole purchase
process. We belong to the API College for Castillon,
our registered number is 403.
What do you need to know
In reality, for foreign people, there
are no legal restrictions in respect to the purchase
of any properties in Spain.
Properties offered in Spain can be divided
as follows:
- Apartments
- Semi-detached houses
- Detached house
- Country houses... and any other quality
properties.
You need to understand that, as the buyer,
there are extras that you will need to pay for,
this represents about 10% of the purchase price. You
will have to pay for:
- Transfer Tax (ITP 7%) for the purchase
of second hand properties, or, for the purchase of
new properties Value Added Tax (IVA) again 7% of the
purchase price.
- The expenses of the Notary and the registration
of the purchased property (approximately 2% of the
purchase price)
- The expenses associated with the connection
of the various services to the property (water, electricity,
telephone, etc.)
- Finally the charges to AIRMAR for managing
these activities for you.
As a result of being a property owner in
Spain, the taxes that a non-resident
citizen has to pay are as follows:
- Annual Property Tax (Impuesto sobre Bienes
Inmuebles)
- Local tax for rubbish collection and
main drainage (Basuras y Alcantarillado)
- Wealth Tax based on bank and savings
accounts in Spain (Impuesto sobre el Patrimonio)
- A tax based on the theoretical rental
value of your property (Impuesto sobre la Renta de
No Residentes)
It is also important to know that, when
a non-resident sells their property in Spain, the “Hacienda” (the
Tax Office) will take 5% of the declared price written
into the Property Deeds,
this is an advance payment against any liability for
Capital Gains Tax on the property sale. AIRMAR will advise
the Vendor what the final Capital Gains Tax should be,
they will assist in recovering any over paid tax or conversly,
if you wish, they will assist you in paying any further
tax due.
The Community of Proprietors
When you buy a property in Spain, often
the property is a part of a larger building with shared
elements (gardens, pool, parking etc.) or if a house,
it may be situated within a group of other properties,
again, with shared elements (roads, street lighting etc.)
If this is the case, you have now become a member of
a Community of Proprietors (the
Community), where you and the other property owners are
jointly responsible for the upkeep of these shared elements.
Status
Each property that forms a part of the Community has
a calculated ‘quota’. Normally this ‘quota’ is
based on the relative size of each property. Your annual community
charges will be based on this ‘quota’ as
a proportion of the overall annual costs of running
the Community.
The decision
making body
The highest decision making body in the Community is
the Junta General (a meeting
of all the property owners). These meetings can
take two forms: the Annual General Meeting (AGM), which
occures every year, and the Extrordinary Meeting, which
can be conviened at any time when a situation demands
it.
The AGM elect a President,
a Secretary and
an Administrator,
who manage the Community during a period that has been
agreed by the Junta General,
generally one year.
Community Charges
At the AGM a budget for the coming year is presented
to the Community. When the Community accepts the budget,
the Administrator apportions the amount to be paid
by each property owner, based on the ‘quota’ for
each property. The amounts are either paid in advance
for the whole year, or in stages through the year.
The Property Deeds
(Escritura)
In Spain, because Property Deeds are
a legal document, they always have to be approved and
signed by a Notary.
The Vendor presents, to the Notary,
a draft of the Property Deeds and
the declarations of the two parties involved with the
sale and purchase of the property. If necessary, the Notary will
edit the Property Deeds as
presented to him. If it is new property, the Property
Deeds will be based on the law of horizontal
division and the laws related to the construction of
new houses.
Once signed in front of the Notary,
it is recommended that the Property
Deeds be then registered with the Registrar
of
Properties for the local area, so that
your rights to the property are legally protected.
If it is not necessary to a have a mortgage
for the purchase of the property, it will be written
into the Property Deeds that
the amount of the purchase has been entirely paid and
that the Property Deeds constitutes
a firm and complete receipt of the purchase.
The Purchaser has to pay all the expenses
associated with the Property
Deeds, with the exception of Capital
Gain Tax. (Impuesto de Plusvalía) which, in accordance
with Spanish law, is paid by the Vendor.
Registration
Some days after the signing, the Notary will
send to AIRMAR a copy of the Property
Deeds. At AIRMAR, we will carry out the administration
necessary for the Property Deeds to
be entered into the Property Register (Registro de la
Propiedad) at the Land Registry Office.
Once the Property
Deeds have been entered into the Property
Register. The Registar will complete the entry to give
an appropriate Registration Number. When the formal
steps are complete, the Registrar sends a copy of the
new Property Deeds to
AIRMAR, and we pass the Deeds to the client.
The original Property
Deeds are kept in the Notary's archives. On
the payment of an appropriate charge, at any time,
any interested party can obtain a copy of the Property
Deeds.
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