THE AIPP / RICS / RDE
GUIDE TO BUYING
A PROPERTY IN SPAIN
2
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
03 Why this guide?
04 Who are the AIPP?
05 Who are RICS?
06 Who are the RDE?
07 Frank and Diane want to buy abroad
08 The property search
Property portals, search engines, print, high street agencies,
propertynders.WhybuythroughaRICS/AIPPmember.
12 Spain’s variety environment
Thecountryside,smalltownsandvillages,cities,seaside,
urbanisationsandresorts
14 Where in Spain?
CostaVerde,Catalonia,CostaBlanca,CostaCálida,
theSouthernCoast,theBalearicandCanaryIslands
16 Planning to view
Howtoview.Shouldyoutakeaninspectiontrip?
17 Team Frank and Diane
Lawyer,gestor,currencyspecialist,gettingamortgage
Contents
19 Viewings
Allowingforbuyingcosts,checklist,whattolookfor
20 Buying the property
Thereservationagreement,obtainingyourNIEnumber,eight
thingsyourlawyermustcheck.
23 Preliminary sales contract (arras)
Payingfromataxhaven,delayingthesale
24 Contract of sale (escritura)
TheNotary,powerofattorney,rentedproperties
26 Registering ownership
27 Inheritance
28 Contributing authors
29 APPENDIX ONE
Applying for Registry information
31 APPENDIXTWO
The costs of buying property in Spain
33 APPENDIX THREE
Related links
3
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
We are going to tell a simple but exciting story,
about a couple who buy a house in Spain.
Ourcouple,FrankandDiane,havedreamedaboutthishomeforalong
time.Theyhavetalkedaboutit,planneditandsavedforit.Buttheyare
worried.AftertheirmainhomeintheUKthiswillbethemostexpensive
thingtheyeverbuyandtheyintendtodoitright.
WewillfollowFrankandDianeastheygothroughtheprocessesof
buyingahomeinSpain.Alongthewaywewilllearnthedifferences
betweentheSpanishregionsandenvironments,fromthewetandwild
coastofGaliciatothedesertsofAlmanzora.Wewillinvestigatethe
processesofSpanishpropertybuyingandshowyouhowtobuysafely.
WearebasingFrankandDiane’sexperiencesonthethousandsof
peoplethatweattheAIPP,RICSandRDEhavemetandadvisedover
thepasttenyears.FrankandDianearenotspecicpeople,butthey
havethesamedreamsandfacethesamechallengesasthetensof
thousandsofrealpeoplewhowouldliketobuyabroad.Wewillfollow
themfromtheirlivingroomsomewhereintheUnitedKingdom,to
gettingthekeysandsettlingdownintheirvillaonaSpanishseaside.
AlthoughFrankandDianeareBritish,theycouldjustaseasilybe
LarsandLottefromBelgium,MaxandMiafromGermanyorShirley
andSheilafromAustralia.Thedangersareallthesamewhenfolks
“leavetheirbrainsbehindattheairport”andtherewardsarethesame
whentheydoitright.
Wehopeyouwilldownloadthisguideandkeepithandy.Feelfreeto
printitoffandpackitinyoursuitcase.Ifyouhaveafriendthinkingof
buyinginSpain,pleasesenditontothem.Weknowitisimmensely
rewardingtodeeplysavouranothernationthroughimmersionintheir
cultureasfacilitatedbypropertyownership,andwehopethatthis
guidehelpsyoutomakeawonderful–andsafe–startonyour
journey.
Why this guide?
4
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
TheAssociationofInternationalPropertyProfessionals(AIPP)isa
not-for-protorganisation,setupin2006,operatingintheinternational
propertymarketandbasedinWestminster,London.TheAIPPnowhas
over350corporatemembersin28countriesaroundtheworld
includingestateagents,developers,lawyers,banks,FX,media,
technical,advisory&otherinternationalpropertyprofessionals.
The AIPP focuses on two key things:
1. Championing & delivering buyer education and protection through
our free buying guides & seminars backed by the AIPP’s Code of
Conduct, Arbitration and Dispute Resolution Services. Allofour
servicesarefreetopropertybuyers.TheAIPPpresentedtheindustry
WhitePapertoUKMembersofParliamentintheHouseofCommonsin
November2014,withcallsforanAPPG(AllPartyParliamentaryGroup)
fortheinternationalpropertyindustry.TheAIPPisalsoaTrusteeofthe
InternationalPropertyEthics&StandardsCoalition.
2. Guiding the international property industry to best practice. The
AIPP,withitspartners,isnowbringingtothetradeasignicantnew
digitalinitiativetotransformhowdevelopers,agentsandbuyerscan
transactamoresecurepropertysale.
Thesaleofpropertyisusuallyan(ofcially)unregulatedactivityin
foreigncountries(itisintheUKtoo,althoughRICSBlueBookisaiming
toimprovestandardshere),yettouchesuponsignicantnancial,tax,
estateplanningandotherownershipissues.Ifyouareatallunsure
abouthowtonavigatethemanyissuesthispresentsthenpleasedo
contactanindependentnancialadviser.TheAIPPisnotregulatedto
givenancialadviceand,accordingly,wedonotseektodosohere.
YoucanndoutmoreabouttheAIPPatwww.aipp.org.uk,which
includesatwo-minutevideoonwhatwedo,free,forbuyers.Dotake
theopportunitytoresearchandconnectwithourmembersinyour
countryofchoice.
Unfortunately,wecannotassistmembersofthepublicwithissues
arisingwithnon-AIPPmembers.Membersarelistedonourwebsite
withcurrentmemberstobefoundonourhomepagethroughthe
simplesearchfacility.
Acoupleofquicktipsbeforeyouread-on:doensureyouuseatruly
independentlawyertohandleanypurchaseyoumakeandyoumay
alsobenetfromreadingourfreegeneralbuyingguide‘How to Buy
Overseas Property Safely’andour‘Guide to UK Pension
Changes & Buying a Foreign Property’.Youcandownloadthese
freeofchargefromourhomepage.
Who are the AIPP?
Peter Robinson,
Managing Director, AIPP
TheAssociationofInternationalPropertyProfessionals
5
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Condence through professional standards.
TheRoyalInstitutionofCharteredSurveyors(RICS)promotesand
enforcesthehighestprofessionalqualicationsandstandardsinthe
developmentandmanagementofland,realestate,constructionand
infrastructure.Ournamepromisestheconsistentdeliveryofstandards
–bringingcondencetothemarketsweserve.
Weaccredit118,000professionals,andanyindividualorrm
registeredwithRICSissubjecttoourqualityassurance.Theirexpertise
coversvaluationandresidential/commercialpropertypractice;property
nanceandinvestment;projectmanagement,planningand
development;quantitysurveying;facilitiesmanagement.
Fromenvironmentalassessmentstorealestatetransactions,
ifourmembersareinvolved,thesameprofessionalstandardsand
ethicsapply.
Webelievethatstandardsunderpineffectivemarkets.Withupto
70%oftheworld’swealthboundupinlandandrealestate,oursector
isvitaltoeconomicdevelopment,helpingtosupportstable,
sustainableinvestmentandgrowtharoundtheglobe.
Withofcescoveringthemajorpoliticalandnancialcentresinthe
world,weareideallyplacedtoinuencepolicyandembedprofessional
standards.Weworkatacross-governmentallevel,delivering
internationalstandardsthatwillsupportasafeandvibrant
marketplaceinland,realestate,constructionandinfrastructure,for
thebenetofall.
Weareproudofourreputationandsustainit,soclientswhowork
withaRICSprofessionalcanhavecondenceinthequalityandethics
oftheservicesprovided.
Alfredo Millá,
Chairman of the Property
Professional Group of
RICS Spain
Who are RICS?
TheRoyalInstitutionofCharteredSurveyors
6
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
The Colegio Nacional de Registradores de
España, usually shortened to Registradores de
España, is the Spanish Registrars Association.
Weareapublicandlegalbody,bringingtogetheralltheLandand
CompaniesRegistrarsinSpain.Theseregistrarsarepublicofcersand
legalprofessionalsresponsibleformonitoringthelegalityofdocuments
authorisedbynotaries,issuedbyjudgesandadministrativeauthorities
orsignedbyindividuals,toensurethatonlycompletelyvalid
documentscanberegistered.
Tobearegistrar,itisnecessarytobeSpanish,withadegree
ordoctorateinlaw,andtopassacompetitiveexaminationonthe
currentlaw.
TheessentialpurposeoftheLandRegistry,andthereforethebasic
functionofregistrars,istoensuresafetyinlegalrelationsconcerning
propertyrights.Bythepublicationofpropertyrightsthrough
registration,afterdebuggingdefectsallegedlyvitiatingthedeed,if
needed,overallenforceabilityisachieved,makingtheserightsreach
undisputedcategory.Onceregistered,noonecanclaimtoignorethe
existenceofthepropertyright,itscontentortheidentityoftheperson
towhomitbelongs.
TheAssociationwasfoundedin1886andbecameanofcial
professionalassociationinMay1934.
Ouraims,apartfromcheckingmembershipandenforcinginternal
rules,aretocoordinatetheprofessionalactivitiesofregistrars,
ensuringprofessionalethicsandtheproperexerciseoftheirfunctions,
tocollaboratewithadvisorybodiesandpublicadministrationson
matterswithinthecompetenceoftheregistrar,andtopromotethe
modernisationoftheregistries.
Topromotebestpracticesinregistrationmatters,withspecial
attentiontoconsumers,theAssociationalsoworksinternationally.
Thatiswhywearepleasedtohelpinwritingthisguide.
Who are the RDE?
The Spanish Registrars Association
Gonzalo Aguilera Anegón,
Dean and President of the
Spanish Land and Mercantile
Registrars Association
7
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Itis6.20onaTuesdayeveninginthe
UnitedKingdom.Sittingonthesofain
theirhomeareFrankandDianeJones.
ThecouplearewatchingAPlaceintheSun
onChannel4,wherethepresenteris
showingacouplearoundavillainMojácar
–somewhereFrankhadneverevenheard
of.Theyhavewatchedtheshowbefore,but
onthisparticulareveningtheyarelooking
withrathermoreinterestthanusual
becausetheyhavenallydecidedthat
nowisthetimetobuyahomeinSpain.
Spreadoutonthecoffeetablearepiles
ofbooks,magazinesandnewspaper
propertysupplements,allaboutbuying
propertyabroad.Sometheyhavebought
foradviceandsomebecausetheylist
properties.TheyalsohaveDiane’siPad
openandhavebeenickingthrough
onlineproperties,lookingatmapsand
photosorproperties,evendronefootage.
Theyhavegatheredalotofinformation,
becausetheywanttodoitright.Theyare
determinedtheywillnotbethosepeople
whorunintotroublewiththeiroverseas
propertypurchases.
FrankandDianeareintheirmid-50sand
liveintheUK.Whyaretheythinkingabout
buyingabroad?Althoughbothareworking
theyalsobothhaveaneyeontheir
retirement.Itwillnotbeanidleretirement;
theyareastastheyeverwereand
arefeelingadventurousaboutlife.
Theirchildrenhavelefthometostart
theirownfamiliesandFrankandDianesee
itastheirchancetoshineagain.Theywant
toopenthemselvesuptonewexperiences,
learnanewlanguage,meetnewpeople.
WhybuyahomeinSpain?“Whynot?”
saysDiane.
Frank and Diane
want to buy abroad
The World ♥ Spain!
FrankandDianearefollowingalongtraditionof
foreignersfallinginlovewiththeSpanish
culture,lifestyle,environmentandweather.It
hasbeenwrittenaboutpoeticallybyGerald
BrenanandLaurieLee,andhilariouslybyChris
StewartandPeterKerr.Readtheirbooksfora
tasteoftheexpatlifestyle.
No-oneknowspreciselyhowmanyforeigners
liveinSpainbecausethelinebetweenlong
holidayandsemi-permanentresidenceoften
becomesblurredandmanypermanent
residentsdon’tinformtheauthoritiesoftheir
presence*.WhatwedoknowisthatBritons
havetraditionallybeenthebiggestforeign
buyersinSpain,witharound750,000Brits
beginningnewlivesinSpain.TheSpanish
RegistrarsAssociationfoundthattheBritish
madeup16%ofpurchasesbyoverseasbuyers
in2014(downfromnearly40%in2008).Next
cametheFrenchwith10%andbuyersfrom
Russia,Germany,Belgium,SwedenandItalyall
withmorethan5%ofthemarket.
Spainisstillattractingrecordnumbersof
tourists;65millioninternationaltouristarrivals
in2014setyetanotherrecord,againwith
Britonsmakingupthebiggestcontingent.Its
economymayhavesufferedinrecentyears,but
Spainismorepopularthanever.
*When overseas residents don’t register with
the authorities the government doesn’t allocate
money to care for them in the health services,
so it is vital for people living in Spain to register.
8
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
WhenFrankandDianeboughttheirUKhome
20yearsagoithadbeenveryeasy.Achoice
oftwoorthreetownscloseenoughtoeach
others’workplaces,relativesandadecent
school,thebudgetdictatedbytheirdeposit
andearnings.Theyjustlookedthroughthe
localpaper,wentintoafewestateagent
shopsandahandfulofviewingslaterthey
choseahousetheybothloved.Everythingwas
sortedoutbythelawyersandestateagent.
Niceandeasy.
WiththeirSpanishproperty,thechoicesare
innitelywider.Sotheirrststepsaretosee
whattheycangetfortheirmoney,decidewhat
sortoflifestyletheywouldlikeinSpain,and
where.Theyhavebeentoldthattheyshould
budget15%forbuyingexpenses.Ontheother
hand,theywouldhopetonegotiatealittle
moneyofftheaskingprice,sotheyhave
decidedtolookatpropertiesonorslightly
belowtheirbudget.
Finding a property
DianeisalittlemoretechsavvythanFrank,
sosheislookingviatheinternetandheis
goingforthetraditionalmedia.
Property “portals”
Propertyportalsdidn’tevenexistthelast
timeFrankandDianeboughtahouse.Now,
virtuallyallpropertiesappearonthem,in
everycountry.Portalsarenotestateagents,
theyaremorelikeanonlinemagazinewhere
individualestateagentspaytolisttheir
The property search
Property Portals
Whatportalsdowellisshowingthepropertiesin
auser-friendlywaywiththeverylatest
technology.Theycanevenbeusedonthemove,
toresearchpropertyforsaleinaSpanishvillage,
forexample,whilesittinginthevillagesquare!
Onhertabletdevice(iPad,Nexus,Hudl,etc)
Dianeisabletobringupanonlinemapand
drawwithherngeronthescreenaroundthe
areainwhichsheisinterested;instantlyevery
propertywithinthatareaappearsonherscreen.
Thebiggestportalsineachcountry–
RightmoveintheUK,SelogerinFrance,
Immobilienscout24inGermany–eachhavean
internationalsectionwithhundredsifnot
thousandsofSpanishproperties.Dianealso
discoverssomespecicallyoverseasproperty
portalssuchaswww.aplaceinthesun.comand
Spainspecialistssuchaswww.kyero.com.There
areportalsaimedatSpanishbuyersbutwith
listingstranslatedintoEnglishtoo,suchas
www.idealista.com/en,andiftheyarenotin
English,suchaswww.pisos.com,herbrowser
(Chrome,Safari,etc)hasasettingthatgivesher
aninstanttranslationfromSpanishtoEnglish.
Bytheendofhersearch,Dianehassaved50
propertiesinvariouspartsofSpainthatshehas
keptforacloserlook.
9
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
properties.Tousetheportal,Dianegoesto
thewebsite,typesintothe‘Search’boxher
chosenarea,typeofproperty(villa,
apartment,farmhouse,landetc),minimum
andmaximumbudgetandnumberof
bedrooms.Instantlytheportallistsallthe
propertiesthatmatchhercriteria,froma
rangeofdifferentagents.
Shecanthenickthroughthemandsave
toherowndedicatedlistanyshewantsto
takeacloserlookatlater.Shealsoprintsthe
detailsoftheonesshelikestoshowthemto
Frank.Withacoupleofthepropertiesshe
likesmostofall,Dianeclicksonthecontact
detailstoseewhotheagentisandwhatelse
theyoffer.
Search Engines
Portalsarenottheonlyresourceonline.
AfterafewsecondsofGoogling,Dianends
hundredsofestateagentwebsitesandonline
magazinestolookat.
Aswellasthese,shealsondsherself
invitedtosignupforfreeguidesoffering
adviceonbuyingpropertyinSpain.
CRUNCH POINT: This is a potential
risk.Peoplewiththemoneytobuya
propertyabroadareatempting
targetforanyone,honestornot,tryingtosell
“investments”.TherelaxationofUKpension
rulesin2015hasmadethoseover55even
moretempting.Therststepingettingyouto
partwithyourmoneyoftensoundsinnocent
enough–a“pensionreview”forexample,ora
freedownloadableguide.Thevastmajorityof
theseareentirelyinnocentandoftenvery
useful;atworstyoumaygetasalescallfrom
an“investmentexpert”.Butwhengivingout
personaldetailsuseextremecare,especially
whenitcomestonancialdetails.
Six critical reasons to buy through an AIPP/RICS member
AIPPandRICSmembersareboundby
CodesofConducttoofferanhonestservice.
AIPPManagingDirectorPeter Robinson
answerssixcommonquestions:
1. Is buying a home in Spain
difcult?
Notatall!However,potentialheartache,
timeandmoneycanbesavedbyjust
‘startingright’.Mostpeoplepurchasea
foreignhomewiththeirspouseorpartnerso
itisveryimportantthatyouareboth
completelyinagreement,thatyouwantthe
sameoutcomes,samecountry,region,
propertyandlifestyle.Takesomequietand
reectivetimetopondertheseissuesand
perhapswritedown,separately,whatitis
youreallywantbeforeembarkingonyour
journeytogethertowardsapurchase.
Selectingagoodagenttoworkwithiseven
moreimportantthanintheUKasthe
processofbuyingandthensupport
followingapurchaseisdifferent.Itcantake
muchlonger(often6-18months)tondthe
rightlocationandpropertyinSpainandit
willbeamorecomfortableprocessifyour
agentisreputableandcanofferyouthe
appropriate,expertguidance.Beinga
memberoftheAIPP/RICSisagreatstart.
2. Any tips on budgeting?
Ifyouhaveapropertyinyourhomecountry
youunderstandwhatitcoststobothbuy
andownaproperty.Butwhilethesales
priceofyourSpanishpropertymaybe
appealing,theactualcostofbuyingand
owningitmaybehigherthanyouthought.
Forexample,whenjudgedagainstaUKor
Australianpropertybynumberofbedrooms
orpersquaremetre,aSpanishproperty
maybeverywellpriced.Butyouneedto
factorinaround12%-15%forbuyingcosts,
especiallywhenbuyingusingamortgage.
Thesecostsneedtobepaidforincashand
covermainlylegal,notaryandlocaltaxes.
Therunningcostsmustbecarefully
consideredtoo.Hotterweatherandthe
effectsofseaaircanmeanspendingmore
careandcashonyourproperty.Detached
villaswithprivatepoolsneedmore
caretakingthananapartment,forexample,
andtherewillbelocalmunicipaltaxesto
paytoo.Itiswiththisinmindthatbuyers
shouldconsidertherentalappealoftheir
property,andindeedwhetherlocallaws
allowthemtorenttheirpropertyout.
Rentingoutyourpropertyevenforashort
timecanhelptooffsetorcompletelycover
thecostsofmaintenanceandownership.
However,thisincomewillbesubjectto
taxationsodoyoursumscarefullyand
checkwiththeauthorities.
3. Could we save by not
getting a lawyer?
FewBritishpeoplewouldbuyapropertyin
theUKwithoutappointinganindependent
legalrepresentative,andthesamegoesin
mostcountries.Sowhytaketheriskwhen
buyingabroad?TheAIPPandRICSadvise
appointingatrulyindependentlawyer
(abogado)whoonlyhasyourbestinterests
atheart.Alawyerlinkedtotheagent/
developersellingthepropertymaybe
10
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Magazines, newspapers, books
Frankishappierusingoldtechnologyandover
thecourseofaweekhasgatheredupapileof
magazinesandnewspapersupplements.
Mostnationalnewspapersincludeaproperty
supplement,especiallyattheweekends,and
therearealsomagazinesdevotedtooverseas
property,suchasAPlaceintheSunintheUK,
orglobaltitlessuchasAbode2.Many
countriesalsohavespecialistmagazines
dedicatedtoSpain,suchasLivingSpainin
theUK.Allofthesecarryadverts(aswellas
adviceandinformation)forpropertyinSpain.
Frankhasalsobeentohislocallibraryand
orderedbooksonbuyingpropertyandretiring
toSpain.Lookingcloser,henoticeshowever
thatmanywerewrittenatleastadecadeago.
BUYING TIP Asarststepintheir
search,Frankhasboughttwo
identicalcopiesofapopular
overseaspropertymagazine.Hekeepsonefor
himselfandgivesonetoDiane,andeachof
them,separately,circlespropertiesinthe
magazineusingcolouredpens.Aproperty
Franklovesgetsagreencircle,onehequite
likegetsorangeandapropertyhedislikes
getsred.Onlyafternishingcirclingalltheir
propertiesdotheyswapmagazinestosee
whattheotherreallylikes(andhates!).
Six critical reasons to buy through an AIPP/RICS member (cont...)
workingforthe‘deal’.Bewaretheterm
‘solicitor’too.InEnglishitnormallymeansa
qualiedlawyerbuttranslatedfromSpanish
itmayrefertosomeonewithoutanyformal
legaltrainingbutwithabusiness‘advising’
onpropertysales.Youcanndabogados
whoareAIPPorRICSmembersat
www.aipp.org.ukandwww.ricsrms.com.
4. What about a survey?
YounormallygetasurveydoneonaUK
property,sowhynotonaprospective
Spanishhome?Manyrepossessedor
unsoldhomesbuiltintheboomof2000to
2007havelainempty.Unlessyourproperty
comeswithaspecicguaranteethatyour
independentlawyerveries,thenAIPP/RICS
recommendyouhaveabuildingsurvey
completed.Ifyouarebuyinga“resale”
property,previouslyownedandoccupied,a
surveyiswellworthhavingtoo.Spanish
buildingregulationshaveimproved
immeasurablyoverthelast20yearsorso,
butevenmorerecentpropertiesmighthave
beenbuiltby‘cuttingcorners’andneed
checkingoverbyaprofessional.
5. What issues do permanent
emigrators face?
Relocationforshort/longperiodsorona
permanentbasisbringsdifferent
considerations.Schoolstendtorequire
applicationsinJanuaryfortheautumn
intake.Taxresidencyisabigsubjectand
youshouldtakespecialist,regulatedadvice.
IfyouarereceivingapensionintheUKyou
needtoconsidertheupside/downsideof
sterlingcurrencyuctuationsintoeuros.A
currencybroker(severalmembersarelisted
ontheAIPPwebsite)canhelpyoumanage
yourmoneyanddeliverbanktransfersthat
couldsignicantlyimprovewhatyoureceive
versusyourbankdefaultoption.Healthcare
isfreelyavailabletoEUcitizensinmember
statesbutyoushouldregisterwiththelocal
doctorandsatisfyyourselfthatyourSpanish
languageskills,orthedoctor’sEnglish,are
goodenoughtobeunderstood,perhapsin
anemergency.Hospitalsvaryintheirability
tounderstandEnglishandcanbehard-
pressedtocopeifasignicantnumberof
olderexpats(ofmanyforeignnationalities)
liveclosebyandarefrequentusersoftheir
services.Planningeverydayconsiderations
aroundanup-to-datepassport,European
drivinglicenceandthelogisticsofmoving
housecontentsinalorryforapermanent
move,alsoneedcareandattention.
6. Planning for the future
Makingalegallybindingwillinyourhome
countryandSpainisveryimportant.
Inheritanceandsuccessionplanningmay
besobersubjectsbutyouwillneedtopay
carefulattentionifyouaretoleavetoyour
family/beneciariesallthatyouintended.
On17August2015,EuropeanUnion
legislationon‘forcedheirship’changed
accordingtoregulationnumber650/2012.
Anypersonthenowningpropertyina
participatingEUstate(whohastaken
appropriateactionbeforetheirdeath),can
choosebetweenthelawofthecountryof
theirhabitualresidence,orthelawoftheir
nationalitytogovernthedevolutionoftheir
EUestate.
Betweenyourhomecountry,Spainand
theEuropeanUnion,rulescanchange
frequently,sogettingproper,up-to-dateand
regulatedtaxadviceisessential.
11
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
On the high street
WhenevertheygotoSpain,FrankandDiane
enjoylookingatestateagentwindows.It’sa
goodplacetostart,becauseevenwiththe
growthofportalsandtheweb,goodpremises
isanearlyindicationofarespectableagent.
Alocal,trainedandexperiencedagent
shouldbeeveryhomebuyer’sbestfriend.
Althoughpaidbytheseller,itisthebuyerthey
needtoimpressandtheyshouldbepricing
propertyfairly,buttosell.Theywillbeableto
offerguidanceonallaspectsofthearea,the
propertyandthebuyingprocesses.Manywill
stayintouchandhelpbuyerslongafterthe
sale–thisisaspecialisedmarketwhereword
ofmouthrecommendationgoesalongway!
YoursafestbetistobuythroughanAIPP
and/orRICSmember,astheyaretrained,
vettedandhavesigneduptoacodeof
conduct.ToseeAIPPandRICSmembers
workinginSpain,consulttheirwebsitesat
www.aipp.org.ukandwww.ricsrms.com.
BUYING TIP Spainhasprofessional
organisationsforestateagents,both
atlocallyandnationally.Bestknown
nationallyareAPI(AgentesdelaPropiedad
Inmobiliaria,www.consejocoapis.org)and
GIPE(GestoresIntermediarioenPromociones
deEdicaciones,www.gipe.es/en).APIand
GIPEmembersshouldbetrained,butensure
thattheagentyouchooseisstillamember(or
waseveramember)bylookingatthe
organisations’websites.
Frankispuzzledtoseethesamepropertyon
rivalagents’websites.Therecouldbeseveral
explanationsforthis.Thesellermaybetrying
hisluckwithtwoormoreagents,justasthey
doinothercountries.Theagenciescouldbe
teamingup–whichmakessenseinSpain,
whereoverseasbuyersoftensearchacrossa
widerangeoflocationsandispossibledueto
therelativelyhighcommissions.Another
possibilityisthattheagentislistingpropertyhe
isunauthorisedtosell,tomakehiswebsite
lookmoreenticing–magicallythepropertywill
havebeensoldwhenyouasktoviewit!
Rememberthatjustbecauseanagentis
fromyourcountryorspeaksyourlanguage
well,youshouldnotabandonallcaution.
Property nders
Anotheroptionistoemploytheservicesofa
“propertynder”.Theyaremostpopularwith
expatriateexecutiveswhoareshortoftime,
butreceivearelocationbudgetfromtheir
employer.Propertyndersareusuallyexpats
themselvesandsoareabletooffera
supportive“handholding”roletonewarrivals.
Thebenetsincludebeingthebusybuyer’s
friendontheground,siftingthroughproperty
andhelpingtonegotiatepricesfromaposition
oflocalknowledge.Intheorytheycouldpay
backtheirownfeesbygettingyouacheaper
priceandsavingyoutimeandeffort.
However,thisisanunregulatedactivityand
youneedtobesurethatapropertynder
genuinelyhascontactsandknowledgeinyour
chosenareaandpricerange.
12
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
ForFrankandDiane,asformanypeople,
buyinginSpainisaboutmorethanwarm
weather.Itisthechancetoreassesstheir
livesandtheirpriorities.Whattheywanttodo
inlifewilldeterminewhattheywantfromtheir
Spanishproperty.
Dotheywishtotakeonthechallengeof
livinginanentirelynewculturewherealmost
no-onespeaksEnglish,orwouldtheyprefer
thesafetynetoffellowoverseasresidents
nearby?Dotheywantsomelandtoenjoya
morerurallifestyle?Couldtheycopewith
lookingafterchickensandolivetrees,or
wouldtheyreallyprefertojustrelaxbythegolf
courseandpool?Eveniftheywouldliketo,
couldtheymeetthosechallenges,physically?
Ifbuyinginretirement,dotheyhaveaplanfor
whentheybecomemorefrail?Howarethey
withextremeheat?Willtheybeabletolearn
Spanish;theycouldfeelveryisolatedinrural
areasorsmalltownsiftheycannot.Willthey
bespendinglongenoughinSpaintomaintain
theirowngardenandpool?Willtheyever
wanttorentthepropertyout?Ontheother
hand,cantheyaffordtobuythestress-free
propertieswhereeverythingisdoneforthem?
Thesedecisionswilldeterminethesortof
environmentwheretheychoosetobuy.Here
areafewoptionsforthemtothinkabout.
Living in the countryside
Spainhasaround95peoplepersquare
kilometre.TheUKhas265,Belgium370and
theNetherlandsnearly500.Sofornew
arrivalsfromnorthernEurope,Spainisbigger,
emptier,hotterandfarmoremountainous.
Gojustafewmilesinlandfromthecoast
andit’snotunusualtoseefarmersriding
donkeysandshepherdstendingocks.
Thisisthe‘campo’,thecountryside.
Peoplearejustaswarmandfriendlyas
onthecoasts(maybemoreso),butthey
areunlikelytospeakEnglish.
Livinginthecampocertainlyhasits
attractions–thequiet,thespace,thebeauty
bothofthecountrysideandthefarmhouses,
andallatamuchlowerpricethanyouwould
normallypayforBritishruralproperties.If
lookingtobuyinthecountrysideyouneedto
paycloseattentiontowhereutilitysupplies
willcomefromandhoweasyaccesswillbein
weatherextremes.Historically,therehave
beenproblemsoverplanningandownership
ofruralpropertiessoalwaystakeextracareto
getagood,experiencedlawyer.Bealittle
cautiousifyourlawyerisrecommendedby
yourestateagent;mostareentirelyreputable
butinasmallcommunitytheycouldbeclosely
connectedsociallyorbyfamilyandbemore
loyaltotheagentwhoregularlysendsthe
workthantothe‘oneoff’housebuyer.
Certainly,youshouldnotusethesamelawyer
astheseller.
Towns and villages
50yearsago,thevastmajorityofSpaniards
livedinvillagesandsmalltowns.Fromthe
1970stothe1990smorethan10million
movedprovinces.Manyoftheyoungerpeople
movedtothecoastslookingforbetterpaid
workinthetouristtradewhilemillionsmore
movedtothecities.Sincethen,however,in
thesouthandeastespecially,expatsfrom
Britain,northernEuropeandevenfurther
aeldhavearrivedseekinganewlifestyleand
revivingvillagelife.Schoolshavereopened,
villageestasbegunagainandlocalpeople
havecashedinonoldpropertiesandland.
Inthenorthernprovinces,therearestill
entireabandonedvillagesforsale,while
inAndalusiathepicturesque“whitevillages”
havebeengreatfavouritesamong
Britishbuyers.
IfFrankandDianechoosetoliveinasmall
town,whetheronthecoastortheinterior,
theywillhaveahugechoice.Theycouldlivein
Spain’s varied environment
13
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
atownlikeTorrevieja,inAlicante,withalarge
Britishpopulationthathascreateditsown
institutionssuchasweekendcarbootsales,
andstartedthesameclubsandsocietiesas
at‘home’.Ortheycouldoptforatowninthe
interiorwithhardlyanyforeignresidents–but
withrichtraditionsandestasbasedaround
theCatholicfaithortheruralwayoflife.They
mightnotndmuchEnglishspoken,butwill
beabletoimmersethemselvesmorefullyin
oneoftheworld’sgreatlanguagesand
civilisations.
The cities
BudgetightstoMadrid,Barcelona,Alicante,
Málaga,PalmadeMallorcaandsomany
Spanishcitieshavemadetheideaofa
weekendboltholeveryappealing.Whilecity
apartmentsareoftenhighlyexpensive,and
citiescanbepollutedandnoisy,Spainhas
investedheavilyinthosethingsthatbringin
tourists,suchastransportinfrastructure,
museums,theartsandculture.
Comparedtomanycountries’cities,Spain’s
areclean,safeandwell-managed,with
extremelygoodshoppingbothinstreet
marketsandhigh-endinternationalbrands.
Andofcourse,thecafécultureintapasbars
andstreetcafésisunsurpassed.Therental
potentialforapropertyinthecitycanbe
verytemptingtoo.
The seaside
Mostoverseasbuyerscomefortheseaside.It
isn’tjustthechancetoswiminit,thecoastal
stripalsohasthefacilitiesandinfrastructure
–airports,golfcourses,nightlife,international
schools,attractiveproperty,English-speaking
professionals–aswellascoolingseabreezes
andaready-madeexpatsociallife.Pricesare,
ofcourse,moreexpensive,butyoumightnot
necessarilyneedaseaviewandmanyofthe
seasideadvantagescanbehadafewmiles
inland.Spainisblessedwithtwowonderful
islandgroups,theBalearicsinthe
MediterraneanandtheCanariesfurthersouth
offtheNorthAfricancoast(whichmakesthem
warmallyear).
Urbanisation
Thewordurbanisationmaynotsoundvery
enticing,buttherearesoundreasonsfor
expatstochoosethem.Essentiallytheyare
housingdevelopmentsbuiltoutsidetowns
andvillageswheretheownersform
themselvesintoacommunityandmanage
thedevelopmentamongstthemselves.
Thebenetsofbuyingonanurbanisation
include:farlessriskofbuyingan‘illegal’
property,theyareagoodwaytomeetthe
locals(theSpanisharejustaslikelytobuyon
anurbanisationasforeignersare),andyou
canhaveasayinhowyoururbanisationis
runifyouchoosetogetaplaceonthe
managementcommittee(indeedyoumay
havetowhetheryoulikeitornot!).
Resort property
Thisisundoubtedlythestress-freeoption(so
longasmoneyisn’tshort).Buyonaresortand
FrankandDianewon’thavetoworryabout
cleaningthecommunalpool,wateringthe
garden,maintainingtheroadsorndingrental
guests.Dependingontheresorttheychoose,
ofcourse,theyarelikelytobelivingamonga
widerangeofforeignownersaswellas
Spanish.Therewillbesocialandsports
activitiesonsite,oftenincludingbeachclubs,
golfcourses,tenniscourts,gymsandspas.
Thedownsidesincludetheexpensive
managementandmaintenancefees,the
somewhatarticialnatureofsomeresorts,
thecontroloverhowyoucandecorateyour
homeoutside(thiscanbethecasewith
urbanisationstoo),thefactthatmanyofyour
neighboursmaybeanendlesschurnof
holidaymakers.
14
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Costa Verde
NorthernandsouthernSpainhavevery
differentclimates.Thenorth-west,sticking
outintotheBayofBiscayandtheAtlantic
andknownasGreenSpainorCostaVerde
comprisesGalicia,Asturias,Cantabriaand
theBasqueCountry.Itisgreenerbecauseit
iswetter,withmountainsthatarestillhome
to(afew)wolvesandbears,leadingdownto
lushmeadowsandforestsandontoshing
villagesonthecoastthatstretchessome
800kilometresfromFrancetonorthern
Portugal.Howwetisit?It’swetterthan
Wales,with1,545mmofrainonSantiago
deCompostelacomparedto1,150mmon
Cardiff.TheCostaVerdeismuchless
touristythantheothercoasts,butthatis
moredowntotheunpredictableweather
thananylackofbeauty.Thereisa
goodchoiceofruralpropertyhereat
reasonableprices.
Catalonia and the North East
Themostwell-knowncityisBarcelona,the
mostfamouscoasttheCostaBravawith
resortssuchasBlanes,LloretandTossade
Mar.Itisagreen,ruggedandmountainous
coastwithsandybays.Althoughitattracted
largenumbersofpackagetouristsinthe
earlydays,ithasmadeaconcertedattempt
togoupmarketinrecentdecadesandprices
herearerelativelyexpensive.
Climate-wise,theweatherisperfectfor
summers,butcangetchillyinthewinter.
Indeedanyonelookingforwinterwarmth
shouldheadsouthofValencia.
The Costa Blanca
SouthofValenciatheweatherwarmsupall
yearandthemostpopularexpatareasstart.
IthasaclimatejudgedbytheWorldHealth
Organisationtobethehealthiestinthe
world,withwarmthallyearbuttemperedby
Mediterraneanbreezes.CostaBlancaNorth
isgreener,moremountainousandwith
smaller,quieterresortsandexpat-friendly
townslikeDéniaandJávea.Inland,theJalón
Valleyispopularwithoverseasbuyers.When
youmovesouthofBenidormtheCosta
BlancaSouthisatteranddryer.Whileithas
sufferedfromoverdevelopment,itisalso
cheapertobuyinresortssuchasTorrevieja
andOrihuelaCosta.Thehistoriccityof
AlicantesitssouthofBenidormandthe
CostaBlanca’sbeautifulinteriorincludes
odditiessuchasthepalmforestofElche.
Year-roundgolfisaspeciality.
Costa Cálida and
Costa Almería
Spainbecomesmorearidasyouheadsouth
fromtheCostaBlanca,includinganactual
desertatAlmanzora.However,itisalsoa
majoragriculturalsuppliertoo,especiallyin
Murciainthenorthernsectionandinlandto
thesouthofAlmeriacity.SouthofMurcia,
withinAndalusia,Almeriawasarelatively
quietandpoorprovinceuntilthetouristsand
newresidentsarrived,pricedoutofthe
neighbouringcostas.InMurciathereare
well-knownresortsaroundtheMarMenor,in
thenorthinwhatiscalledtheCostaCálida,
andfurthersouth,MojácarandRoquetasdel
Where in Spain?
Spain’s Regions
1. Andalucía
2. Aragón
3. Asturias
4. Cantabria
5. CastillayLeón
6. Castilla-LaMancha
7. Cataluña
8. Extremadura
9. Galicia
10. IslasBaleares
11. IslasCanarias
12. LaRioja
13. Madrid
14. Murcia
15 Navarra
16. PaísVasco
17. ComunidadValenciana
Costa Verde Costa Blanca
SpainismadeupofAutonomousCommunities
(“autonomies”)whichfurtherdivideinto
provinces.ForbuyerslikeFrankandDiane,the
differencesmaybeofonlypassinginterest,but
procedurescanvarybetweenregions,for
example,ingettinganNIEnumber,andthere
aresmalldifferencesinlawsbetween
autonomieswhichyourlawyershouldbeaware
of.Languagestoo,canvary:Catalonia,
Valencia,theBasqueCountryandtheBalearics
havetheirownlanguages,sowhileDiane’s
rudimentaryCastilianSpanishwillallowherto
beunderstood,thelocallanguagesaremorein
commonuse.
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9
3
4
16
15
2
12
5
8
13
6
14
17
7
11
10
15
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
MarontheCostaAlmería.Intheyearsupto
thenancialcrisistheseareassawamajor
propertyconstructionboom.
The Southern Coast
ThesouthofSpainincludesthewell-known
CostadelSolinthemiddle,thelessfamous
CostaTropicaltotheeastandCostadela
LuzrunninguptoPortugal.
WithresortslikeAlmuñecar,Nerja,
Torremolinos,Fuengirola,Mijas,Marbella
andEsteponaitistheclassicSpanish
property-buyingdestination.TheBritishare
stillthebiggestbuyershere,butthereare
alsolargenumbersofRussians,Belgians,
GermansandScandinavianstoo,attracted
bytheunrivalledopportunitiesforfun,with
golfandwatersportsfortheenergetic,along
withgreatshoppingandrestaurants.Hotin
summer,warminwinter,openallyear,ifyou
wantyoucanliveherelikeinEssexor
Rotterdamwithsunshine;yettraveljusta
fewmilesinlandandyou’restraightbackin
oldSpain,withitsroughruraltraditionsand
grandhistoryincitieslikeGranada,Málaga,
Córdoba,Seville,JerezandCádiz.
The Balearic Islands
Mallorca,MenorcaandIbiza(andthetiny
islandofFormentera,offIbiza)formthe
BalearicIslandsintheMediterranean.
OnMallorca,themadnessofresortslike
Magalufsitsalongsideclassyseaside
villagesandresortswheretheSpanishroyal
familyspendsitssummersandthelikes
ofRichardBransonhavehomes.Ithas
somethingforeveryone,includingthe
beautiful(andexpensive)cityofPalma,
artycommunitieslikeDeiàandValldemossa
alongthenortherncoastandthemore
family-orientedresortsoftheeastcoast.
Aswellasvillasandholidayapartments,
beautifulandhistoriccity-centreapartments
andconvertedfarmhousesintheinterior
arealsopopular.
MenorcaisespeciallypopularwithBritish
families.Itisquieter,moreeasy-goingand
lessexpensivethanitsneighbours,but
travellingthereislesseasyinwinter.No
problemsgettingtoIbizaallyear,wherethe
partyneverstops.Althoughitmaybeknown
foritshedonisticlifestyle,Ibiza’sattractions
alsoincluderollingpine-coveredhillsand
hiddencoves.Propertyisamongthemost
expensiveinSpain.
The Canary Islands
TheCanaries,sittingoffthecoastof
Morocco,arewarm,butnotespeciallyhot,all
year.Buyhereandyoucangetfourseasons
ofenjoyment(orrental).Theyarecomprised
ofsevenislands:Tenerife,Lanzarote,
Fuerteventura,GranCanaria,LaPalma,La
GomeraandElHierro.Eachisdifferent,
somesandy,somemorevolcanic,others
withvibrantnightlifeandcheapholiday
apartments,othersquieter.Buyinghere
requirescarefulconsiderationaseachisland
issodifferent–it’snotlikebuyinginthe
CostadelSol,whichhasabitofeverything.
TheCanaryIslandsmaybeknownfortheir
inexpensive,year-roundholidayvibe,butthey
alsohavegreatnaturalbeauty,deepgorges,
bananaplantationsandSpain’shighest
mountain.
Costa Almería
Balearic Islands
Canary Islands
Costa del Sol
16
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
A trip to Spain
FrankandDianedecidetomaketheirown
waytoSpain.Theycallafewoftheagentsin
theirchosenareaandtakeadviceonhow
manypropertiestheycanviewinaday.One
agentinparticularseemsverypushy.“Don’t
worryaboutanyotheragentsinthearea,”
shesays,“weallpoolourpropertiesanyway,
soIcanshowyouthemall.Infactwecando
itallforyou,wehavelawyers,ourown
in-housesurveyor.Youcanevenstayinour
subsidisedguesthouse!”Agentsdoindeed
oftenshareproperties,butyoushouldnever
usean“in-house”lawyer.Frankdecidesto
steerclearofthisagent.
CRUNCH POINT
Take Control!
Hereisthecruxoftheproblemfor
ForeignpeoplebuyingpropertyinSpain:
thelegalsystemisdifferent,thelanguageis
different,theprofessionalcultureis
different.Vitallegalandplanning
documentswillbeinSpanish.Professionals
whoserolesFrankandDianethinkthey
understandmaybehardertond,while
theyaresuddenlyexpectedtounderstand
whata‘gestor’ora‘notary’does.
Itcanfeellikecostsaremountingupall
thetime.
Andtheyarenotdoingthisfromthe
comfortoftheirownhome,withfriendsto
consultwith,butinSpain,probablyfroma
hotel,withtheclocktickingbecausethey
haveightshomescheduled.
Thisiswhatisknownasbeingoutofyour
comfortzoneandexplainsexactlywhyso
manypeoplemakemistakes.
Subconsciously,buyersarelookingfor
someonetotrust,buttheonlypeoplethey
aretalkingtoaretryingtoselltheman
expensiveproduct,aproperty.Nowonder
peopledroptheirguard!
BUYING TIP FrankandDianeneed
togetbackincontrol.Theyshould
dothisbeforetheyevenleavethe
UKbypreparingforeacheventualityand
recognisingpotentialproblemsinadvance.
Firsttheyneedateamofpeoplebehind
them.SowhileDianeischeckingight
prices,Frankisorganising“TeamFrank&
Diane”.Forastarttheymustalwaystake
independentlegaladvice.
Planning to view
Inspection trips vs. going it alone
CRUNCH POINT: Withsomuch
planningalreadydone,Frankiskeento
getontheinternetandbookights.
ButthenDianeseesanadvert:“Inspectiontrips,
just€49!!”
AninspectiontripisashortbreakinSpain
subsidisedbytheagent,whowillbeyourtour
guideonthetripwhiletryingtosellyoua
property.
Inthelastbuyingpropertyboomtenyears
ago,entirejetswerebeingcharteredby
developerstobringBritonsoverfortwoorthree
daysasacaptiveaudience,whilecommission-
desperateagentsblastedthemwithhard-sell
techniques.Theygainedsuchabadreputation
thatthesedaysinspectiontripstendtobecalled
somethingdifferent–“discoveryvisits”or
“viewingtrips”perhaps.Theadvantagetothe
house-hunter,however,wasacheaptriptoa
locationtheymightlike,withexpert(ifbiased)
guidancetothelocalareaandnoneedtoworry
aboutbookinghotelsorcars.
Thedaysofthosekindsofmassinspection
tripmaybeover,butmostagentswillhelp
potentialclientsinotherways.Forexample,the
agentmaygivethemafreenightinaresort,or
promisetorepaythecostofightsiftheydo
agreetobuy.Thereisnothingwrongwithtaking
aninspectiontrip,butyouneedtobeawarethat
youarenotstayingwithfriends,butwithan
agentwhowon’tearnacentfromthetripunless
youbuyaproperty.
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THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Lawyer
Thelawyerisyourmostimportantteam
member.Itissensibletoensurethatthey
areonyoursideandhavenonancial
connectionwiththeestateagentor
developer.Thiscanbeeasiersaidthandone
intheexcitedushofmakinganofferona
home.Whatwillyoudowhentheagenttells
youaboutthebrilliantlawyertheyalways
workwith?Manyagentswillindeedbeable
torecommendagood,fairandreasonably
pricedlawyerwhospecialisesinproperty,so
whynotusethem?Ifyoudo,however,doask
formorethanonerecommendationandask
toseequalicationsandreferences.
Onewayaroundtheissueistoengagethe
lawyerinadvance.Feesvarydependingon
theservicesprovided,butareunlikelytobe
lessthan1–1.5%ofthepropertyvalue,plus
VAT.Younormallyonlystartpayingwhenthey
startworkingforyou,perhapsongettingyour
identitynumber(NIE)andopeningabank
account(whichshouldalsobedonebefore
ndingaproperty).Youwouldtypicallypayup
to€1,000atthispoint;therestbystages.
FrankandDianecanndspecialist
Spanishpropertylawyersinanyofthe
magazines,booksandwebsitestheyvisit.
WithaBritish-basedlawyertheyshouldrst
checkthattheyarequalied,reliableand
haveexperienceoperatinginSpain.Most
importantisthattheyareconscientious,as
theywillbetakingthebuyer’splaceinthe
negotiationsand“duediligence”.Canthey
betrustedtoaskallthequestionsFrankand
Dianedon’tknowtoask?Frankchecksthat
theUK-basedlawyersareregisteredwiththe
appropriateLawSocietyintheUK–even
thoughtheworkinSpainwon’tberegulated
bythem–andthattheyarequaliedas
lawyers,“abogados”,inSpain.Theyshould
alsobespecialistsininternational
transactions.
Agoodplacetostartwhenlookingfor
alawyeristheAIPPwebsiteortheRICS
website.Thereyouwillndlistedseveral
Spanish-specialistpropertylawyersas
members–basedbothintheUKandSpain.
Currency (“FX”) specialist
Whentransferringlargeorregularamounts
ofmoneyabroadthebestmethodisviaa
specialistcurrencybroker.Theywillgiveyou
abetterrateofexchangethanusingoneof
themoreobvioussuchasyourdebitcard,
highstreetbankorairportcurrencyshop.
Team Frank and Diane
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THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Ontheotherhand,ifthepound
strengthensto€1.40bycompletionthenthe
housewouldhaveonlycost£98,570had
theyboughttheeurosatthelastmoment,
andtheyhavelostout.Frank,beingmoreof
arisktaker,wasratherlookingforwardto
trackingtheexchangerateastheprocess
movedon,butDianeconvinceshimtoplay
safe.Buyingaforwardcontractmeansthey
knowexactlywhatitwillcost.
Andthegoodthingis,theydidn’tneedto
paythemoneywhensettingtherate,only
whenactuallycompletingonthepurchase.
BUYING TIP
Gestor
Thisrolegoesbacktothedays
whenmanypeoplewereilliterate,and
neededarepresentativetodealwith
bureaucracy.Nowtheyarehelpfulnotonly
indealingwithbureaucraticaspectsoflife,
likeavoidingendlessqueuing,butalsoin,
forexample,organisingtheconnectionof
utilitieswhenyouhaveboughttheproperty.
Alawyercouldalsoassistwiththis.
Howmuch?Around3or4%ontheexchange
rateandusuallywithnotransferfees.Ona
£100,000propertyanFXrmshouldsave
youseveralthousandpounds.
FrankandDianendtheprocessisquite
simple:theygotothewebsiteofoneofthe
currencybrokers(theyareregulatedbythe
FCAandassafeasabank)andareinvitedto
setupatradingaccount.Thentheydecide
whethertomakea“forwardcontract”,which
setsthepriceoftheeurosnomatterwhen
theyareactuallytransferringthefunds.The
advantageofthisisindeterminingexactly
whattheywillpayfortheirproperty.
Exchangerateschangeeverysecond,and
withoutaforwardcontracttheywouldnever
knowexactlywhatitwouldcostuntiltheday
ofpurchase.FrankandDianehaveseta
budgetof£100,000andagreetobuyeuros
at€1.38,whichtheyknowtheycanafford.If
theypurchasefor€138,000butbythetime
theycompletethepoundhasdroppedto
€1.36,thentond€138,000wouldhave
costthemanextra£1,470,perhapstaking
thepropertyoutoftheirreach.Buyingin
advancehassavedthemthatrisk.
Getting a mortgage
Manybuyerswillnancetheirhousepurchase
withamortgage.Themortgageproviderwill
normallyrequirethefollowingdocumentation:
• Incometaxdeclarationforthepasttwoyears
• Bankstatementsfromthepastyear.
• Payrollorotherproofofincomeforthe
pastsixmonths.
• Alistofmortgageloansalreadyheld.
• Astatementofyourassetsandliabilities,
conrmedbyanaccountant.
• Acopyofyourpassport.
Whenlookingforamortgageloan,consider:
• Thebankwillinsistthatthepropertybe
registeredinyourname.Thecontractof
sale,receiptoffundsandconstitutionofthe
mortgagewillhappensimultaneously,soan
agentfromthebankwillbepresentatthe
signingofthedeedsandwillforwardthe
moneytotheseller.
• Mortgagesaregenerally“adhesion”(takeit
orleaveit)contractswhichincludegeneral
conditions.Yourlawyershouldensurethat
yourmortgagetakesintoaccountconsumer
protectionlegislation.
• Thepropertymayalreadyhaveamortgage
onitsignedbythesellerordeveloper.Ifso,
thebuyermustensurethatheorshewill
notbesubrogatedtothismortgageloan
(i.e.becomeresponsibleforit).
Ifthebuyerdoessubrogatehimselftothe
loanreceivedbythesellerordeveloper:
• Heshouldrequirethesellertoshowa
certicateissuedbythecreditorbank,
statingtheoutstandingbalancedue.
• Hecanaskthecreditorbankforamore
favourableinterestrateandtermfor
payment,andiftheyrefusetodoso,may
requestanotherbankorentitytoimprove
suchconditions.Thenthenewentitypays
thecurrentholderofthemortgagethe
outstandingsumandmovesintoitsplace
asacreditor.Suchoperationsarevirtually
free,beingtaxexempt,withnotary,registry
andbankfeesstrictlylimitedbylaw.
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THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Checklist
FrankandDianehaveowntoSpain.They
knowwhattheywant:avillaontheCosta
Blanca.Theyknowtheirbudget:£100,000,
whichwiththeirforwardcurrencyarrangement
isguaranteedtobuythem€138,000.Outof
thistheymustpayasmuchas13%extrafor
buyingcostsandtax,and2%moreiftheyare
goingtogetamortgage,whichismadeupof
thefollowing:
Taxes (VAT/ITP): 10%
Notary fees: 1%
Registration of property: 1%
Stamp duty: 1%
Andincasetheyneedamortgage,theywill
haveanextracost:
Other fees (gestoria, Registry, property
valuation, notary) 0.8%
Mortgage stamp duty: 1%
Bank mortgage commission: 0.25%
Themostsignicantoftheseistax,whichis
subjecttochangedependingonthepolitical
oreconomiccircumstances.
FrankandDianedecidetolookatproperty
ofupto€140,000andhopetonegotiatethe
pricedowntoamorecomfortable€120,000.
Theyarestayinginahotelandhave
checkedthattheyhaveaccesstotheirphone
andtheinternetsotheycancontacttheir
lawyerquickly.Whentheyneedit,theycan
easilyandcheaplysendmoneyforadeposit,
ortopayalocalsurveyor.
Theyhavearrangedasmanyviewingsas
possible,butwithplentyoftimeforrelaxing
anddiscussingwhattheyhaveseen.They
haveborneinmindthedistancesandlocal
terrainwhenconsideringhowmanyhouses
theycancomfortablyviewinthetime.They
haveinstructedtheestateagentsnottoshow
themanypropertyoutsidetheirpricerange.
Theyhaveareliablecamerasotheycantake
plentyofphotosandpossiblyavideo(on
whichtheycouldrecordtheirownverbalrst
impressionstoo),anotebooktowritedown
anyextrainformationtheestateagentsgive
them,orquestionstheywillneedanswering.
Lastly,theyhaveachecklistofinformation
requirements.
BUYING TIP Frankhascreatedhis
ownscoringsystemforeach
property.Thishastheadvantageof
listingthosecriteriathathehasjudgedmost
important.Allofthisinformationwillbe
organisedintoaletorereadatthehotel.
Now,let’sseesomehouses!
What to look for?
FrankandDianeknowthatwhateverisstated
onalatercontract,thesellermustprovide
whatislistedontheinitialsalesinformation,
includingallservicesandfacilities.Sowhen
conductingaviewing,theycheckthatthe
propertymatcheswhatislistedonthedetails
intermsofqualityofmaterials,stateofrepair,
views,thelocalneighbourhood,noise,access
totransportation,etc.Theybringanyissuesto
theattentionoftheselleroragentshowing
themthehouseand,iftheyarenotconvinced
bytheagent’sexplanations,theymayreturn
accompaniedbyaprofessionalarchitector
surveyortoinspectitandgetavaluationto
correctit.
Anycompanysellingorpromotinghousing
shouldmakethefollowinginformation
availabletothepublic:
1. Thetradename,companyname,address.
2. Whereappropriate,thedetailsofthe 
seller/ownerenteredintheCompanies
Registry.(Orjustaskforthesimplenote,
“NotaSimple”,oftheproperty–which
containsalltheinformation).
3. Amapshowingthelocationoftheproperty
andideallyaoorplan.
4. Apropertydescription,showingitsgross
overallareaandideallyitsinternalusable
area(seebox,right)and,where
appropriate,ageneraldescriptionofthe
buildinginwhichitislocated,thecommon
areasandancillaryservices.
5. Energyperformancecerticate(CEE),
listingmaterialsusedinconstruction 
includingacousticandthermalinsulation,
buildingandcommonareas,and
ancillaryservices.Makesurethatitis
stampedasbeingregisteredwiththe
RegionalAuthorityasonlythenwillitbe
acceptedbytheRegistrar.Thecerticateis
validforuptotenyears.Ithastobe
Viewings
Surface area
Thesurfaceareasofpropertymaybelistedin
severalways:
• Grossoorarea/constructedarea
(supercieconstruida)
Thisspeciestheouterareaofthebuilding
anddenesalltheenclosedspace,including
allbuiltspaces,partitions,wallsand
facilities.
• Usefularea(supercieútil)
Thisalsospeciestheouterarea,butonly
thebuiltspacesthatmaybeusedbythe
inhabitants.Itdoesnotincludethepartitions,
structureandfacilities.
Ifthedwellingispartofacondominium,thereis
athirdconceptofsurface:
• Grossoorareaincludingcommon
elements(supercieconstruidacon
repercusión de elementos comunes)
Thisisthegrossoorareaofeachatofthe
condominium,plustheproportionatepartof
thegrossoorareaofallpublicareasofthe
samebuilding.Thesearecalculated
accordingtosharessetbythestatutesofthe
home-owners.Itincludesallthespacesof
theapartmentplusapartofthecommon
areas(entrancehall,staircase,broomcloset
andmachineroom,elevatorshaft,etc.)of
thebuildinginwhichitislocated.
providedbythevendoranditisnormally
attachedtothetitledeed(escritura).
6. Instructionsontheuseandmaintenance
ofanyfacilitiesthatrequirespecial
knowledge,andtheevacuationofthe
buildinginanemergency.Aso-calledBook
 oftheBuilding(LibrodelEdicio)mustbe
givenbythebuildertotheagent,withall
thisinformation,tobepassedonbyevery
sellertoanewowner.Insomeregionsthe
bookmustbeatthedisposalofanynew
owner,inpossessionofanotary,orinthe
LandRegistryinwhosejurisdictionthe
 propertyislocated.
7. Identicationdetailsoftheregistrationof
thepropertyintheLandRegistry,or
astatementofnotbeingenrolledinit.
20
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
AsEuropeanUnionmembers,theBritishhave
thesamerighttobuyinSpainastheSpanish
do,althoughwithafewrestrictions.However,
therearesignicantlegaldifferencesinthe
salesprocessesbetweencountries,suchas
propertylaw,urbanplanningandcoastallaw,
buildingregulation,taxlaw,moneylaundering
regulations,mortgageregulationsand
consumerrights.Whatfollowstherefore,is
justageneraloverview.
LikeFrankandDiane,youshouldalways
getindependentlegaladvicebefore
attemptingtobuypropertyinSpain.
Reservation agreement.
FrankandDianehavefoundtheproperty
theylike.Theiragentnowtakesthemtoa
localbartocelebrateandexplainswhatwill
happennext.
Firstlytheyaregivenadocumenttosign
andaskedtopay€5,000asdeposit,because
theagentssaysthereareotherpeoplelooking
atthehouse.Indeed,itcouldwellbebeing
marketedbyotheragentstoo,whomustbe
informedthattheownerhasagreedand
stoppedallviewings.
MostlegaldocumentswillbeinSpanish–
thatbeingthelegallanguageofthecountry
–soatranslationmustbegivenandboth
signedbytheownerandthebuyeror
theirrepresentatives.
CRUNCH POINT: Frankfeels
uncomfortablesigningthiscontract,
andinsiststhattheywillconsult
theirlawyerrst.Hedoesn’twanttobe
committingtobuythepropertybeforeany
legalcheckshavebeencompleted.Itmakes
foraslightlyawkwardcelebrationbut,as
FranksaystoDianewhiletheagentisn’t
listening–betterthatthanspendingyears
regrettingit.Assoonastheygetbacktotheir
hotel,Franksendsacopyoftheagreement
totheirindependentlawyer.
Frank’slawyercallshimbackandexplains
thatafterreadingitthrough,hecanconrm
thatthisissimplya“reservationagreement”
totakethespeciedpropertyoffthemarket
for,usually,15-30days,atthestatedprice.
Itisquitenormaltopayadepositofbetween
€3,000and€10,000,whichwillbetakenoff
thenalpurchaseprice.ByFrankandDiane
makingtheagreementsubjecttopreliminary
legalchecks,mortgageloanavailabilityonthe
propertyandabuildingsurvey,thedeposit
shouldbereturnedifthereareproblems.
Estateagentsareunderstandablykeentoget
overseasbuyers–whoarepronetogetting
Buying the property
Speedy Spain
CRUNCH POINT: Therearemanyways
ofbuyingpropertyinSpain.Thetypeof
contractwilldependonthetypeof
property,whethernewbuildorresale,the
nationalityofthebuyer(understandably,sellers
aremorekeentogetabindingdepositfroman
overseasbuyer),thespeedwithwhichthe
buyerswantmattersconcluded,andhowmuch
theytrusttheseller.Ifalltheduediligencecan
becompletedquicklyitispossibletobuya
propertyinSpaininadayortwo,butnever
attempttobuyquicklyifitmeansskimpingon
yourlegalprotection.
Inthisguidewedescribetheusualprocessesfor
aforeign(UK)couplebuyingaresaleproperty.
21
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Obtaining your NIE
ExpatriateslivinginSpainwillusually
alreadyhaveanNIE,asyouneedonefor
manytransactions;certainlyanythingthat
involvespayingtax.Propertybuyers
arrivingfromoutsideSpain,however,will
needtogetone.NIEstandsfornúmerode
identicacióndeextranjeroandisessential
forbuyingproperty,obtainingmortgages
andgettingutilitiesconnected.SinceFrank
andDianearebuyingthepropertyjointly
theyeachneedanNIE.
Itisnotcomplicatedtoget,butitcan
takefromonedaytosixweeks.Sinceyou
needittosigntheescritura,youwillneed
toapplyatanearlystageinthebuying
process.Itisoftentherstthingyoudo
afteragreeingonaproperty,andoftenthe
estateagentwillhelp,takingyoudownto
theimmigrationortaxofceandensuring
youhaveallthecorrectdocumentation.
Mostpeopleapplyinpersonbutyoucan
alsoapplyviaaSpanishembassyor
consulatebyfollowingthislink:http://
tinyurl.com/pvf2un3.Youcanapply
througharepresentative,orbypost.
Howyoumayapplycanvarybetween
regions.Toapplyinpersonyougotoan
immigrationofce(ocinadeextranjeros)
withinaspeciallydesignatedpolicestation.
Youmusttakethefollowingdocuments:
• Originalandonecopyofyourcurrent
passport.Ifyouprovideonlyonecopy,
itshouldbenotarised
• Ofcialform(EX-15)lledout.
Whenyouhavepaidthesmallfeeyouwill
begivenadatetocomebackandcollectit
(orthereisaprocessforarepresentative
tocollectitforyou).
YouwillalsoneedtheNIEtoopena
bankaccount.Moneylaundering
regulationslimithowmuchyoucanpayin
cashandsetoutthechoiceofpayment
methodsaspartofthesaleagreement.
Paymentwillnormallybebybanktransfer
orbankcheque,soitissensibletoopena
Spanishbankaccountandtransferfunds
fromtheUK.
coldfeetwhentheyreturnhome–tosignand
payupwhilethere.Anditdoessecurethe
propertyforthecouple.However,iftheydidn’t
believeanybodyelsewasimminentlytryingto
buyit,andwerenotentirely100%sure
themselves,whatwouldbetheadvantagein
payingup?Itisasignicantamountofmoney
toloseiftheylaterpullout.
However,FrankandDianedecidethatthey
will“lockin”theirdecisionsotheysignthe
agreementandpaythe€5,000.Nowtheyare
nallyreadytocelebrate!
Thenextday,withtheirlawyerorestate
agenttheygototheimmigrationofcetostart
theprocessofobtainingtheirNIEnumber
(seebox,right).
Theyhavealsogivenadown-paymentto
theirlawyer,whostartsthesearchprocessto
ensurethatthepropertyislegallytheseller’s
tosell(andifitisjointlyowned,get
conrmationthatalltheownershaveagreed
tosell),hasnodebtsorsalerestrictionsonit
andhasplanningpermission.Atthisstage,if
therearelegalproblemsnotmentionedinthe
saleparticularstheywillbeentitledtoback
outandgettheirdepositrepaid.Thiswould
nothavebeenpossiblehadthey,assome
agentswillattempttogetbuyersto,signeda
preliminarysalescontractinsteadofa
reservationagreement.
22
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Eight things your lawyer will be checking
1. Whoownstheproperty,andtherefore
whohastherighttosellit.
2. Iftherearedebtsagainstit.For
example,amortgageorcourt
judgement.
3. Iftherearesittingtenantsinthe
property.
4. Ifitissubjecttoanyspecialrulessuch
assubsidisedhousing.
5. Incaseofanurbanisation,whetherthe
sellerisup-to-datewiththecommunity
fees.
6. Iftheannualrealestatetax(theformer
“contribuciónurbana”)hasbeenpaid.
Ifithasnotbeenpaidwithinthelast
veyears,thenewownerwillbe
responsibleforpayment.
7. Forneworoff-planhomes,ifinsurance
isinplacetocoveranydamagethat
mayresultfromstructuraldefectsof
thebuilding.
8. ForSubsidisedHousing(VPO),or
AppraisedPriceHousing(VPT),ifthere
isanyprohibitionagainstsellingitor
anyrightsofrstrefusalfrom
theauthorities.
Yourlawyerwillgetallthisinformation
fromtheLandRegistry.Abuyercould
alsogettheinformationherself,orthe
seller,estateagentoradministrative
managercoulddoitforyou.Eitherway,
donothandoveranymoneyotherthan
areservationdepositorsignanycontract
otherthanareservationagreementuntil
youhavecheckedthisinformation.
See Appendix One for further information
on applying for information from the
Spanish Land Registry
23
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Paying from a Tax Haven
Ifyourmoneycomesfromaterritory
consideredasataxhaven,youmust
informandexplaintheprojected
investmenttotheSpanishGovernment
atleastsixmonthsinadvance,using
formDP2.Oncethepurchasehasbeen
formalised,youinformtheSpanishTax
Ofceifthemoneycomesfromatax
haven,oriftheamountexceeds
€3,005,060,whatevertheprovenance
oftheinvestedcapitalmightbe.
asdescribedinthebuildingsurveyreport.
Theyandtheowner(ortheirrepresentatives)
thensignthecontract–thereisnonotaryat
thisstage.Theyalsoarrangeforthepayment
of10%ofthepricetobetransferred.
BUYING TIP
GiventhatFrankandDianeare
deniteaboutbuyingtheproperty,
itmightbeintheirintereststopayashigh
adepositaspossible,todissuadetheseller
frombackingout.Ontheotherhand,ifthe
sellerisanon-residentandthemoneyisnot
protected,youneedtoknowthattheywill
notdisappearwithyourmoney,leavingthe
mortgagecompanytoreclaimtheproperty.
Thepaymentmethodwillalsobeagreed
betweenparties.Itwillusuallybeabank
transferorabankchequeshowingthename
ofthepartyreceivingthemoney.Theparties
maysignacontratoprivadodecompraventa
whichcreatesabindingagreementandsets
foracompletiondateaswellasthetermsand
conditionsofthesale(price,wayofpayments,
contractualdeadline…).Ifthesellerbreaches
thatagreement,thepurchasermaytakethe
optionoffulllingtheagreementormay
choosetowithdrawfromthesaleandclaim
fordamagesincurred.Thedifferencewiththe
contratodearrasistheoptiontoenforce
complianceofthepurchaseagreementbefore
applyingforcompensation.
Beforethe15-30dayssetoutonthe
reservationagreementhaverunout,Frank
andDianewillsignthesalescontractthat
commitsthemtobuyingthepropertyandthe
sellertosellittothem.Thereareseveralways
ofdoingthis,forexamplewithapreliminary
salescontract(contratoprivadode
compraventa)oradownpaymentcontract
(contratodepagayseñal).However,formany
overseasbuyersitwillbeadepositcontract
(contratodearras),whichissometimes
translatedasthe‘earnestmoneycontract’).
Thearras/earnestmoneycontractisa
privatelegalagreementwhichreservesthe
righttopurchasethepropertyatasetprice
atasettimetableandpenalisesthebuyer
orselleriftheybreaktheagreement.
• Itsetsouttheexactdetailsofthe
housingtobesold–location,owner,
basicfeaturesandknown
encumbrances.Ifthereisfurniture
included,itwillalsohaveadetailedlist
ofthoseitems,ideallywithphotos.
• Itshouldalsoxthenalprice,payment
methodandthemaximumtimefor
completingthesale.
• Itwillmentiontheamountthathasbeen
alreadydeliveredasadeposit,specifying
thatthemoneyisonaccountofthesale
andwillbedeductedfromthenalprice
whenthedeedisconstituted.Usuallyit
willrangebetween10%and20%ofthe
nalprice.Ideallyitwillbeheldinan
escrowaccount,butwhoeverisholding
it,themoneyshouldnotbetransferred
totheowneruntilthedayofsale.
Althoughthepartiescanagreenotto
includetheseconditions,thelaw
establishescertainpenaltiesforeither
partywhobreachesit:
• Ifitisthebuyerwhobreachesthe
agreement,heorshewilllosethe
amountalreadypaid.
• Ifthesellerisinbreachtheymust
returnthedepositDOUBLED.
FrankandDiane’slawyergoesoverthe
contractwiththem,withatranslation,
andtheyagreethatthepropertyandits
description,location,price,boundariesandso
onareexactlyastheyhadexpectedandare
Preliminary sales contract
(the arras)
Delaying the sale
Supposethecouplewanttobuy,butarenot
readytocommittoanalcontractdate?There
aremechanismsfordelayingtheprocess.
Thecontractfor‘booking’housingisacontract
ofsale,butoneinwhichthebuyerandseller
postponethesale.Itstermswillvarybetween
existinghousesandoff-plansales.Foroffplan,
ifthehousewillnotbereadyintime,orindeed
constructionnotevenstarted,thesellermust
providesomeguaranteesforrepaymentofthe
advancedsums,plusthestatutoryinterest.
Notethefollowinghowever:
- Thespecicationofthepropertyisxedand
neitherthesellernorthebuyermaychangeit
exceptbymutualagreement.Some
developerswilltrytoofferadifferent
property.
- Thepriceisalsoxedandthebuyeris
obligedtopaythissum.Iftheydecidenotto
completeonthepurchasetheywillloseany
moneytheyhavealreadypaid.
Forexistinghomes,thisisquiteacommon
problemforbuyersandcanincludethe
followingscenarios,inbothofwhichthereis
asalecontract,andboththesellerandthe
buyerareobligedtodeliverthehouseand
theprice:
- Thebuyerwantstobuybutdoesnothavethe
money.Ifthebuyeriswaitingfornanceit
maybebettertobookthecontract,while
waitingtogetthemortgageloan.
- Thebuyerhasthemoney,butthesigningof
thecontractisdelayedforsomereason.
IfFrankandDianewanttimetothinkagainorto
obtainfunding,whilemakingsurethattheseller
willnotsell“their”housetoathirdparty,they
couldconsidersigningthecontractbutasking
foraconditionthatthesalewillbedelayeduntil
theyhavereceivednancing.Thenifthebank
refusesthemortgageloan,thesalewillbe
cancelled,withorwithoutcompensationtothe
seller,asthepartieshaveagreed.
24
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Thedateforsigningtheescritura,completing
theprocess,hasbeensetbytheagentsand
lawyerswhensigningthearras.Itissignedin
frontofthenotary.[seebox,below]itcould
havebeendonebyPowerofAttorney,but
FrankandDianewouldratherbetherefor
theprocess.Thepaymentprocesshasbeen
agreed(abankguaranteedchequefrom
theirSpanishbank)andFrankhasdrawn
upalistofnalarrangements.
ThelawyeraccompaniesFrankandDiane
tothenotary.Asbuyerstheyhavetheright
tochoosethenotaryandhaveleftittotheir
lawyertochooseone.
Signingtheescritura–fullnameescritura
pública–involvestheformalhandoverofthe
propertythroughthedeliveryofitskeysand
paymentofthepurchasepricebalance,
eitherfromthebuyerorthemortgage
company/bank.Afterthispoint,neitherside
canturnback.Theprivateagreement
betweenthepartieswillbedeclaredasa
publicchangeofownershipwithsigned
publicdeeds.
Foroff-plansales,peopleusuallygo
throughaprivatecontracttoformalisethe
deliveryofstagepaymentsandtheobligation
tobuildanddeliverthehousing.Importantly,
eveniftheysignaprivatecontract,either
partymayrequesttheothertoproceedto
converttheprivatecontractintoapublic
deed,andiftheotherpartyrefuses,may
seekjudicialintervention.Toregisterthe
purchaseattheLandRegistryitwillalways
The sale contract (escritura)
The Notary
What is a notary?
Are they like a solicitor?
TheSpanishnotary(notario)isapublicly
appointedofcialandverydifferentfrom
aBritishsolicitor.Theirjobistotakea
privatecontractand,bywitnessingit,turn
itintoapublicdeed,adocumentproving
toeveryonethatyouaretheowner.That
makesitquiteaprestigiousjobinthe
localcommunity.
Theirjobistoprepareandwritethe
deed,ensureitsprovisionsarelegal,
ensurethatthepartiesunderstandthe
contractandinformthemoftheirtax
liabilitiesarisingfromthesigningofthe
deed.Allthisisfromanimpartialand
professionalviewpoint:theSpanish
notaryisnotanadvisorandwillnottell
youwhatisbetterforyoutodo,but
ensurethatthelawisenforced.The
notarywillkeeptheoriginalofthedeed,
issuingyouwithasmanylicensedcopies
asyoumayaskfor,eachwiththesame
validity.
Are they absolutely necessary?
Youcouldkeepthechangeofownership
asaprivatecontract,whichshouldbe
enforceableincourt.However,for
overseasbuyersitistheonlysafewayof
establishingtitle,providingthehighest
standardoflegalsecurity.Itisalso
essentialifyouarenancingthrougha
mortgage.
Who pays the notary, and how much?
Thepurchaserpaysmostofthefeesand
alsogetstochoosethenotary.Feesare
usuallyfrom0.1%ofthevalueonthe
deedsforexpensivepropertyandupto
0.4%forcheaperproperty.Eachcopyof
thedeeds(copiasimple)costsafew
eurostoo.
What is the process?
Ontheappointeddayalltheparties
attendthenotary’sofce,whichcanget
quitecrowded.Thenotarychecksthe
identityofthosepresentandreadsout
thedeeds.
Ifyoudon’tspeakSpanishyoushould
takeatranslatoralongtoreadthedeed
inEnglishandaskquestionsonyour
behalfifnecessary.Manynotariesinthe
mainBritish-buyingareaswillspeak
Englishanyway,ormayinsistthatyou
haveatranslatorpresent.Ifrequested,
thedeedwillcomealreadytranslated
withthetextintwocolumns,oneforeach
language.Eachpartywillthenbegiven
thedeedtosign.Thenotarywillconrm
thatpaymenthasbeenmadeandthe
keyswillbehandedover.Thebuyerwill
begivenacopyofthedeedsandtheir
lawyerwillfaxnoticationtotheLand
Registry.Laterthelawyerwillcollectthe
originaldeeds.
Can we use a British notary?
BritonsbuyingfromotherBritonscould
considerusingaBritishnotary(whois
alsonotasolicitor).UsingtheCROBECO
systemcreatedbyEuropeanLand
RegistryAssociation(ELRA),aBritish
notarymayelectronicallyconnectwitha
Spanishadministrativemanager(gestor),
whowillprovidethenecessary
informationandthedocumentation
requiredbySpanishlawtoachieve
registration.
Forfurtherinformation,pleasevisitthe
websiteofELRAat
www.elra.eu/elra-european-land-registry-
association
25
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Rented properties
Therearespecialrulesforpropertythatis
rentedoutatthetimeofthesale.
Asageneralrule,thetenanthastherightto
replacethepurchaserintheeventofthe
landlordwishingtosell.Theseaspectsofrented
propertydependuponthetenancyagreement
andcanbecomplex.Anindependentlawyer
familiarwithlandlordandtenantlawshouldbe
engaged.
Ifthepropertyyouarebuyingisrentedout,your
lawyermustdealwiththisissuebeforeyoupart
withanymoney.
Power of attorney
Itcanbeinconvenientforoverseasbuyersto
returntoSpaineachtimeadocumentneeds
signing,somanywillgrantPowerofAttorneyto
theirrepresentative–perhapstheirlawyerora
gestoriftheyhaveone.Thisauthorisesthe
attorneytosignonthebuyer’sbehalf.
Boththebuyerandwhoeverisgettingthe
PowerofAttorneywillgotothenotary’sofce,
provewhotheyareandexplainthetermsand
limitationsofthepowerofattorney.Youcanalso
organisetogetPowerofAttorneyinSpainby
goingbeforeanotaryintheUK;youcannd
themthroughanysolicitor’sofceorviathis
websitewww.facultyofce.org.uk/notary/.
YoucanalsoappointPowerofAttorneyviathe
SpanishconsulatesinManchesterorLondon.
Theprocesswillcostaround£250intheUK
butmuchlessinSpain.
benecessarytograntthepublicdeed.
Thepublicdeedisadocumentauthorised
bythenotary,reectingthewillofthe
parties,listingtheiridentitiesand
responsibilitiesandincludingtheseonthe
documentastheyintended,butalsoin
accordancewithlegalrequirements.Itwarns
thepartiesabouttheobligationsandduties
arisingfromtheagreedcontractforeachof
them.
Thenotarywitnessestheauthenticityof
thedocument,sothat,whateverthebuyer,
theseller,orwhereappropriate,the
mortgagelender,declaresbeforethenotary
isincludedinthedeed.Thisservesasproof
foreveryoneandneitherpartycandenythe
statementscontainedwithinit.Notarised
recordsarethehighestlegalstandardof
evidenceamongparties.
Theexecutionofthedeediseffectivelythe
deliveryoftheproperty,andthebalanceof
thepurchasepricewillnormallybedelivered
tothesellerinthepresenceofthenotary.
Thenotarymustidentifyinthedeedthe
price,statingifitisreceivedbeforeoratthe
timeofexecutionofthedeed,theamount
andpaymentmethods–i.e.bankcheque
madeouttothesellerorpayabletothe
bearer,banktransfer,directdebit.Ifthe
pricehasbeenpaidpriortothetimeof
executionofthedeed,thenotaryshallstate
thedateordatesonwhichitwasmade
andthepaymentmethodusedineach.
Beforeauthorisingthedeedthenotary
willasktheLandRegistryforasimplenote
statingtheownershipandchargesofthe
estate.Immediatelyafterithasbeensigned,
ifthepartiesrequestit,thenotarywillletthe
Registryknowthatthedeedhasbeen
authorised.Thispreventsthebuyerfrom
beingaffectedbyanylienorchargethatthe
sellermayagreeoncethecontractis
concluded,butwhicharepresentedtothe
Registrybeforethepurchasedeedisgranted.
Home sweet home!
ThehousenowbelongstoFrankandDiane.
Theyaregiventhekeysatthenotary’sofce
anddrivetotheirnewvilla,pausingonly
atasupermarkettobuyabottleortwoof
somethingcoldandsparklingwithwhich
toraiseatoast.
Therearestillthingstodoandtocheck–
ensuringthatelectricityandwaterare
connected,forexample,andthatevery
aspectofthepropertyisastheyexpected.
Butnow,withinsixweeksofrstsettingeyes
ontheproperty,FrankandDianeareableto
sitontheverandaoftheirnewSpanishvilla,
lookoutovertheirCostaBlancaview,wavea
friendly“hola”totheneighboursandlook
forwardtoawonderfulnewstageintheirlife.
26
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Thelegalprocesseshavenotquitenishedyet,
however.Withtheescriturasignedandthe
taxespaid,thenalstepistheregistrationof
FrankandDiane’srightsattheLandRegistry.
Who manages the registration?
ToregisterpropertyrightsintheLandRegistry,
thefollowingdocumentsmustbepresentedat
thelocalRegistryOfce:
• Acertiedcopyofthedeedofsale.
• Printedtaxself-assessmentform,
showingpaymentoftaxesatabank.
• Themostrecentpropertyownershiptax
(IBI),oracadastralcerticateshowing
thecadastralreferenceoftheproperty.
Thesedocumentsshouldbeincorporated
intothedeedanditscopies.
• Proofofsubmissionofacopyofthedeed
tothelocaltaxauthorityforthepurposes
oftheMunicipalTaxonIncreaseinValue
ofLandofUrbanNature(plusvalía).
ThehousingauthoritiesfromtheAutonomy
mayalsorequirethesellertodelivera
certicateofhabitability,provingthatthe
propertymeetsallthetechnicalrequirements
forhabitation.Resaleproperties,aslongas
theyhavethesuppliescontractinplace,will
notneedtoshowtheselicences.
Thepresentationofthesedocuments
totheLandRegistrycanbedonedirectlyby
thebuyer,anagency,thenotary,thelawyer
oragestor.
Howeveryouchoosetodothis,oncethese
documentsareattheRegistry,registration
mustbecompletedwithin15workingdays.
Otherwisetherewillbea30%reductionin
fees.Theregistrarwillverifythatthe
agreementhasbeenmadewithfulllegal
effectandthepropertyrightsofthebuyer
willberecordedattheLandRegistry.Ifthe
registrarseesthatthedocumentshave
defectspreventingtheirregistrationthey
willnotifythelerofthedocumentand
theattestingnotary.
Defectsnotedbytheregistrarmaybe
corrected,orifyoudonotagreewiththe
registrar,youmayrequestasecondopinion
fromanotherregistrarwhomayreplacethe
rst.Thecorrespondingappealmaybe
submittedtotheDirectorateGeneralof
RegistriesandNotaries,oryoumaydirectly
challengeitbeforetheCourtofFirstInstance
inthecapitaloftherelevantprovince.
Thisregistrationisnecessaryforthebuyer’s
newlyacquiredrighttobefullyprotected:
• Youwillbeconsideredtheonlytrue
ownerunlessjudgedotherwise.
• Youareprotectedagainstcreditorsof
theseller.
• Youareprotectedfromhiddencharges
againsttheproperty.
• Youmayobtainjudicialprotectionof
yourrights.
• Onceyouhaveregisteredyourrights,no
onecaneffectivelyacquireanyrights
overyourhomewithoutrstobtaining
yourconsent.
• Youcanobtainamortgageloanto
nancethepurchaseofhousing.Onlyif
thebuyerregistershisorherrightof
ownershipmaythebankregisterthe
mortgagethatguaranteesrepayment.
Thechangeofownershipwillbenotiedtothe
cadastresotheywillknowthattheproperty
taxeswillnowbepaidbythebuyer.
Forallthesereasonsitisessential,aswe
havealreadyexplained,tocheckifthereisany
seizure,mortgageorotherchargein
registrationhistoryofthehouseorthelandon
whichitistobeerected,andtobuyonlyfrom
thepersonlistedasitsownerintheLand
Registry.Itisalsoessential,onceyouhave
signedthedeed,tocompletetheregistration
ofyourrightsintheRegistry.
Registering ownership
27
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
FrankandDianewillgoontoenjoylongand
happylivesinSpain.Butintheeventofthe
deathofourcoupleinSpain,itwillbetheir
nationalityatthetimeofdeaththatgoverns
rulesofinheritanceandsuccession.
IftheyhaveretainedBritishcitizenship,for
example,thenEnglishorScottishlaw
(dependingonwhichpartofBritaintheylive)
willdeterminewhoshouldinheritiftheyhave
notwrittenawill,orhowitwillbeinterpreted
iftheyhave,andhowinheritanceissettled.
Iftheydiewithoutawilltheirestatewillbe
taxedatthefullrate.
Rulescanvaryprofoundlybetween
countries.EnglishLaw,forexample,allowsyou
todowhatyoulikewithyourassets.Butif
yourassetscompriseonlySpanishproperty
thenunderEnglishlawitistheSpanishlaw
thatmustbeapplied,andSpanishlawlimits
yourfreedomwhengrantingawill.Aportionof
yourassetsmustbelefttocertainrelatives
(legítima).Spanishlawwillalsobeappliedif,
atthetimeofdeath,youhaveacquired
Spanishcitizenship.
Writingawillyoushouldconsider:
• YoumaydraftyourwillinSpain,
accordingtoSpanishlaw,usuallysigning
beforeanotary.
• Youmayalternativelydraftyourwill
accordingtoEnglishlaw,butinthiscase
youmustconsidertwocases:
• Awilldrawnupbymechanicalmeans
andsignedinthepresenceoftwo
witnessmustbesubmittedtothe
competentjudicialauthorityinBritainfor
thegrantofprobate,withoutwhichthe
willcannotbeexecuted,northeresulting
propertyrightsregisteredatthe
LandRegistry;
• InaccordancewithEnglishlaw,youcan
grantawillwhichrefersonlytoyour
propertiesinSpain,andyoumaydoso
withaSpanishnotaryorinthemanner
prescribedbyEnglishlaw.Inthatcase,
Spanishlawwillgovernthedistribution
ofinheritances.
Inheritance
PROPERTY TAXES
BuyingapropertyinSpainmeanspaying
propertytaxesatthetimeofcompletion,
whicharebasedonthesalepriceasstated
inthedeedofsale.However,ifthesale
priceisjudgedtobelowerthanthereal
valuethenthetaxofce(Hacienda)will
submitanadditionalbillforthedifference.
- IfthebuyerisnotaSpanishresident,the
sellerwillwithhold3%ofthepriceand
giveittothetaxauthorities.
- IfthesellerisnotaSpanishresident,the
buyerwillwithholdthecapitalgainstax
ontheincreaseinvalueofurbanland–
formerlyknownasplusvalía.
Howmuchtaxispayablewilldependon
whetherthepurchaseisaprimary
residence,abrandnewpropertybought
directlyfromthedeveloper,orisaresale.
New homes: ThebuyerpaysValueAdded
Tax(IVA)totheseller.Atthetimeofwriting
(July2015)thisis10%onresidential
property.IntheCanaryIslandsitis7%,and
calledtheGeneralIndirectCanarianTax
(IGIC).
ThebuyerpaysIVAalongwiththe
purchasepriceandthesellersendsitonto
thetaxauthority.ThebuyeralsopaysStamp
DutyTax(AJD)of0.5%ofthevaluedeclared
onthedeed(unlesssetatadifferentrateby
therelevantAutonomy).Thiswillbe
self-assessedonanofcialformandpaid
intothetaxofceviaacooperatingbank.
Resale homes: Thebuyerofaresalepays
TransferTax(ITP)ratherthanIVA,atarate
of6%ofthevaluedeclaredinthedeed,but
againcanbesetadifferentratebythe
Autonomy.Itisalsopaidviaaself-
assessmentformatacooperatingbank.
Deed of loan: StampDutyTax(AJD)is
payableat0.5%ofthetotalamountofthe
mortgageliability.Thisisnottheamount
actuallyreceivedfromthebank,butthe
quantityguaranteedforrepaymentof
principal,interestandcostsofenforcement.
TheAutonomymaysetdifferenttaxrates.
Ifyoubuysubsidizedhousing(VPO),tax
ratesaregenerallylower.
Paying property taxes
Topaypropertytaxesyouobtainprinted
self-assessmentforms,calculatethe
amount,payittotherelevantentityandgive
theformnotifyingthatyouhavemade
paymenttothetaxofce.Yourlawyerwill
normallypaythepropertytax,butitcouldbe
donebythepurchaser,byanagencyorby
thenotarywhohasdraftedthedeed.
Abuyerpayingpersonallyneedstoknow:
1. Wheretosubmittheself-assessment
formforITPorAJD.Forpropertyin
provincialcapitalsitispaidtothe
DelegationofFinanceofthe
AutonomousCommunity.Forproperty
outsidetheprovincialcapitalitgoesto
theDistrictLiquidationOfce,which
takesintheLandRegistry.
2. PaymentofPropertyTransferTaxand
StampDutyTaxmustbemadewithin30
workingdaysfromthedateofexecution
ofthedeed.Delayswillleadtoasurtax
beingimposed.
3. Paymentofthosetaxesisrequiredfor
youtotakeouttheregistrationofrights
acquiredintheLandRegistry.
28
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Francisco Molina Balaguer
Francisco was born in Valencia and graduated with a Law degree from the University of Valencia in 1998. He has been a Land Registrar
since 2002 and a partner in the International Relations Department of the Spanish Registrars Association since 2012. He was appointed
Delegate to the Association ofce in Brussels in January 2014. He is the author of several articles on tax and inheritance matters
published in the Bulletin of the Spanish Registrars Association, and presented a paper at the IPRA (International Property Registries
Association) conference in Amsterdam in 2012.
Christopher Nye
Following a Bachelor of Arts from Leeds Beckett University and a career in cruise ships and hospitality management, Chris was qualied
by the National Council for the Training of Journalists in 2003.
He has written on tourism, emigration and international property for The Times, BBC, A Place in the Sun, World of Expats and the
Overseas Guides Company, where he is Investment Editor. A former resident and newspaper columnist in Mallorca, Chris has been Staff
Writer for Everything Spain magazine, Features Writer for Living Spain magazine and Editor of Overseas Property Professional. Chris
co-wrote Channel 4’s Guide to Buying in Spain.
Peter Robinson
Peter was formerly an agent in Spain where he also privately bought and sold property. Active in a variety of roles in the international
property and nancial services industry in the UK, Spain and around the world since 2001, Peter has worked extensively with property
developers to improve how they bring their projects to market. Peter now heads the AIPP – Association of International Property
Professionals – based in Westminster, London.
Contributing Authors
César González
Zarza,
MRICS
Bachelors degree in Law
from the University of
Deusto, Spain;
Masters Degree in Urban Planning law from
ULPGC; Executive Masters Degree in Town
Planning from Garrigues School of Law, Madrid;
Bar Association of Canary Islands and practising
lawyer/solicitor;
Member of ACADUR (Urban Planning
Association of Canary Islands);
MRICS nº 1297328
CBRE, Representative Canary Islands
J M Anthony Fisher,
MRICS
British, and a chartered
surveyor since 1977, Anthony’s
career in property includes
living and working in England,
France and Spain. Much of this career has been
related to property management, more recently to
the valuation and inspection of residential property.
Anthony has served on various committees and
working parties of professional associations, latterly
in RICS España. He has written various articles in
English on aspects of property in Spain for journals
of the RICS.
Alfredo Millá, MRICS
Founder and CEO of Sonneil. Before setting up Sonneil, Alfredo led the marketing and selling of properties to foreign clients at Banco
Sabadell and Caja Mediterráneo real estate agencies for seven years. Prior to that, he worked as a strategic consultant. He holds a degree
in Business Administration and Management and an MBA from ESADE Business School and the Advanced Management Program (AMP)
at IESE (Munich and Barcelona). He is also member of the Board of Directors of RICS in Spain and Chairman of the Residential Property
Professional Group.
Campbell D
Ferguson,
FRICS
RICS registered valuer and
expert witness to UK courts.
Owner/Director of Survey
Spain SL and organiser of the Survey Spain
Network of Chartered Surveyors.
Survey Spain has been carrying out
building/structural surveys and valuation
surveys since 2003.
Originally from Glasgow, Scotland,
Campbell has been working in Spain for
16 years and surveying/valuing/marketing/
appraising properties for 47 years.
29
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
APPENDIX ONE
Applying for
Registry information
• Youoryourlawyercanapplyatanyof
theRegistriesofSpaininperson,byfax,
mailoremail.
• Youcanalsoapplyviathewebsiteof
theAssociationofRegistrarsofSpain
www.registradores.org.Toreceivea
“simplenote”inEnglish,usethenew
portalforinternationalusers
www.buyingahouse.registradores.org.
Aftercompletinganenquiryform,your
applicationwillberedirectedtothe
appropriateLandRegistry.Onceissuedand
translated,thenotewillbedeliveredbyemail
andyoucanpaywithanymajorcreditcard.
TondoutwhichLandRegistry’s
jurisdictionthepropertyisin,askthe
Consumers’ServiceoftheAssociationof
Registrars,onfreephone900101141,at
www.registradores.orgorviaemailto
[email protected].Thesameway,
youcanalsondoutLandRegistryaddresses,
phoneandfaxnumbers,emailaddressesand
askaboutanyotherregistrationmatter.
Theregistrationinformationmaybe
obtainedas:
• A“simplenote”,whichcontainsa
descriptionofthehousing,itslocation,
surface,appurtenances,itsshareinthe
condominium,anyadministrative
regimethatcouldaffectit(ifitisa
publichousing),mortgagesthatmay
remainonit,interestandcosts,liens,
seizures,easements,anydisputesover
ownership,scalconditionsand,in 
general,anythingaffectingthe
homeownership.
• Certicationondomainandcharges,
whichmaybeofabroadercontentthan
thesimplenote,andcouldbeused
incourt.
ThemainpurposeoftheLandRegistryisto
publishandprotectlegalentitlements.When
itprovidesadescriptionoftheproperty,it
takesitfromthecatastroandfrom
descriptionsoftheparties,whichmayormay
notbeup-to-date.TheCatastro(alsooften
spelledasCadastre),istheofcialinstitution
inchargeofgivingagraphicdescription.You
canchecktheaccuracyofthecatastrovia
theirwebsiteatwww.sedecatastro.gob.es,or
withaRICSsurveyor.
Youmayalsorequesttheregistrartoprovide
awrittenreportontheregistrationstatusof
theproperty,oraskhimorherforverbal
advice.Landregistrarsarerequiredtoverbally
reportonmattersrelatingtotheregistration
statusofproperties,andsuchlegaladviceis
freeofcharge.Registrationinformationis
providedinaccordancewiththeprovisionsof
theLawonProtectionofPersonalData.
Inadditiontocheckingthehousing
situationintheRegister,thesellermust
provideyouwithcertainadditional
documents:
• Forresalehomes,theauthorisedcopy
ofthedeedinwhichtheacquisitionwas
formalised.
• Areceiptforthelastpaymentofthe
PropertyTax.
• Inthecaseofcondominiums,a
certicateissuedbythepresidentor
secretaryofthehomeowners
associationstatingifthepropertyisup
todateinthepaymentofcommunity
fees.
• Theformalstatement,onapublic
document,thattherearenocurrent
leasesontheproperty.
Non-EU foreigners
Foranytypeofpropertybeingboughtby
foreigners,legislationonnationaldefencecan
comeintoplay.Instrategicareas,prior
authorisationbymilitaryauthoritiesisrequired
fornon-EUforeignerstoacquirehousing,
whetherresidentsinSpainornot.Itapplies
aroundCartagena,theStraitofGibraltar,
CadizBay,Galicia,borderareaswithPortugal
orFrance,theIslandsandCeutaandMelilla.
Furthermore,itismandatorytoregisterthe
transactionintheLandRegistry.
Off-plan property – urban and
building regulations
Examinationofthephysicalandlegalsituation
ofthepropertyismoredifcultwhereithas
notbeenbuiltyet.Theonlydescriptionisthe
onetheagentshowsyou,anditwillonlybe
builtifthedeveloperfullshisobligationsin
accordancewiththecontract.
Soforoff-planpropertydonotsigna
contractorpayanymoneywithoutrst
checking:
• Thedeveloperactuallyexistsandthe
personsigningonitsbehalfisentitled
todoso.Checkthatthesponsoring
companyisregisteredattheCompanies
Registry.Youmayobtaininformation
abouttheregistrationofthecompany,
itsadministrators,agentsandstatutes,
throughacommercialregisterorwww.
registradores.org.Thiscanbeobtained
quicklyandeasilyovertheinternetwith
acreditcardpayment.
• Thelandonwhichthebuildingistobe
erectedisregisteredinthenameofthe
sponsoringcompanywithwhichyou
signthecontract.
• Theplannedpropertyhasbeen
authorisedbythecouncilandgranteda
licence.Thiscanbecheckedatthe
LandRegistry,becauseifthe
descriptionoftheplannedpropertyhas
beenenteredintheRegistrythenthe
licensemustalreadyhavebeenjustied
totheregistrar.Ifthedescriptionofthe
buildingisstillnotrecordedinthe
RegistrythenyouwillneedtogotoCity
Halltocheckifthesitehaspermission
tobuild.
Eachmunicipalityhasitsownurban
developmentplanthatwillagreewiththe
planningregulationsofitsAutonomous
Community.Severalmunicipalitiesmaycreate
ajointplan,regulatingnewdevelopments
outsidetheurbangrid.Thisplanwill
determinewhetheryouareabletobuildon
theplot,andthepossibilityofbuildingand
renovatinginthefuture,or,ontheotherhand,
theextremethreatofreceivingademolition
order.Technicalofcesofthecouncilsshould
provideyouwiththeinformationaboutthe
urbansituationandthechangesthatmay
affecttheplotinthefuture.
Ifyouarerequiredtosignaprivatecontract
beforethebuildingisfullycompleted,andyou
areaskedtopayanyamountonaccountof
theprice,youshouldconsider:
• Ifthecontractincludesunfairterms,
30
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
whichwouldbeconsiderednullandvoid
evenifthepurchaserhassignedthem.
Thesecouldbetermsclaimingto
allowthedevelopertomake
subsequentchangestotheproject
withoutthebuyer’sconsent,orwaiving
therightofthebuyertochoosea
notary,sayingthatthebuyerhastobear
thecostsofpreparingthe
documentation.
• Wherepaymentsaremadetothe
developer,youmayrequirethattheyare
paidintoaspecialaccount,onlytobe
spentonconstruction,andthat
insuranceistakenoutoran
endorsementmadetoensuretheir 
returnplus6%ifconstructionisnot
carriedoutordeliveryisdelayed.Itis
mandatoryforthedevelopertogivethe
clientan“aval”fromabankwhich
guaranteesthepaymentsiftheproject
isnotcompleted.
Onceconstructioniscompletedbutbefore
signingthedeedofsale,youcaninsistthat
thesellerprovesthattheworkhasbeen
completedasdescribedintheplan,andthat
insuranceisinplacetocoveranydefectsin
construction.Thistoomaybecheckedbya
querytotheLandRegistry,becausetoregister
thecompletionofthebuildingitmustreceive
acerticateofnalcompletioninaccordance
withtheagreedplan.Thiswillhavebeen
signedbythearchitectanddirectorofthe
workandwillincludetheinsurancecontract
andatechnicalcerticateindicatingthedate
ofcompletionandsayingthatthebuildingts
thelicense.Therefore,beforesigningthe
deed,youmustverifythatthepromoterhas
enteredthecompletionoftheworkinthe
LandRegistry.
Inrecordingthecompletionofthebuilding
andregisteringconstructionalready
completed,youmustobtainatechnical
certicateshowingthedateofcompletionand
identifyingthatthebuildingtstheprojectfor
whichitslicencewasgranted.
Inanycase,youshouldrequirethesellerto
statethat,oncebuilt,theconstructionmeets
thetechnicalrequirementsfortheuseto
whichitisintended(housing,commercial,
industrial,etc.),bydeliveringyoutherst
occupationlicence,necessarytoconnectto
utilitysupplycompanies(water,electricity,
telephone,etc.).Theselicensesshouldbe
deliveredtothebuyeratthemomentof
signingthedeed.Withoutthem,youmay
refusetosign,astheyareessentialsinlaw.
Purchasing by the seashore
Specialrulesapplyforlandalongthe
seashore–whichcanincludeinlandwaters
–andcontinueinlandasfarasaround100
metres.Suchlandisdesignatedaswithinthe
publicdomain.Youcanbuyahousealready
there,andyouwillbeabletorenovatethe
home,butwithoutextendingthesizeofthe
buildingeitherhorizontallyorvertically.
Tocheckifthehouseisonlandwithinthe
publicdomainyoumustgotoCoastalService
ortotheCityHall.Suchinformationwillalso
appearoninformationprovidedbytheLand
Registry.Fortheexecutionofthedeed,a
certicatefromtheCoastalAuthoritymustbe
giventothenotary,statingifthepropertyison
oradjacenttothepublicdomain,andany
restrictionsarisingfromthat.
Itisespeciallyvitaltotakelegaladvice
whenbuyingclosetotheseashore.
Purchasing an apartment
Whenyouarebuyingacondominiumyou
acquirenotonlyyourpropertybutalsoashare
ofthegeneralbuilding,suchastheentrance
hall,staircase,broomcloset,machineroom,
elevatorshaft,etc.Yourshare–andhence
yourobligationtopaythecommonexpenses
ofthebuilding–correspondstoyour
apartment.
Theowneroftheapartmentmustpaysuch
expensesforthepreviouscalendaryearand
theunpaidpartofthecurrent,somakesure
thesellerdeliversacerticatestatingwhether
therearedebts.Thesellermayaskyouto
exoneratehimorherfromthisobligation.This
isquiteusual,butifyouagreeensureyou
understandthefullextentofyour
responsibility.
Askthesellertogiveyouacopyofthe
articlesofthecondominium,astheymay
restrictyouruseoftheapartments,their
divisionorgrouping,andtheydeterminethe
commonpartsofthebuilding.IntheLand
Registryyoumayobtainacopyoftheclauses
affectingeventhosethatwerenotpartofthe
condominiumatthetimethearticleswere
approved.
Purchasing rural land
Ifyouarethinkingofbuildingapropertyon
ruralland,bearthefollowingfactorsinmind:
• Thepricewillvarydependingonwhether
itisdrylandneedingirrigation,ifitis
plantedwithfruit,cereals,meadows,
forests,etc.,andaccordingtothe
Autonomyonwhichitislocated.
• Checkwhetherthereisanyexisting
buildingonthelandorifthereisthe
possibilityofbuildinginthisarea,
accordingtotheplanningrulesof
theAutonomy.
Generally,rurallandcannotbeusedfor
residentialdevelopment,unlesstheUrban
Authorityrequaliestheland:
- itispossibletorenovateexisting
buildings,eithertoliveinthemorto
establisharuraltourismbusiness,butit
isnotpossibletoaddnewbuildings.
- itispossibletoerectnewbuildingsfor
regularfarmingorhuntingactivity.
- insomecases,youcanbuildsportsor
culturalfacilities,orthoserelatingto
environmentalcare.
- eveninthoserarecaseswherenew
residentialbuildingsmaybebuilt,the
landmustbeofacertainsizeasdecided
bytheAutonomy,toavoidthecreationof
newvillageswithouttheproperchange
ofuseorsufcientinfrastructureto
supportthem.
Thepropertymustalsoholdthecorrect
licensefromthemunicipality.Theinterested
buyer’slawyermustchecktheresidential
potentialoftheland,byaskingforinformation
attheCityHall.Ingeneral,informationfrom
LandRegistrywillalsostatewhetherthe
parcelissuitabletobebuiltornot.
31
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
APPENDIXTWO
The costs of buying
property in Spain
Costs directly generated
Buyingahomegeneratesmanycostsforthe
buyerinadditiontotaxes,anditisnotalways
obviouswhyyouarepayingthemortowhom,
yettheyaddappreciablytothecosts.
Who do you pay?
• To the selleryoupaythepurchaseprice,
lessanydepositalreadypaid.
• The estate agent ispaidbywhoever
contractedthem,whichisgenerallythe
seller.Theyareusuallyincludedinthe
salepriceandsoareonlypaidifthesale
ismade.
• The notary’sfeesaredivided,bylaw:the
sellerpaysforauthorisationofthedeed
andthebuyerpaysfortheissuingof
copiesofthedeed.Thebuyermustpay
allnotaryfeesonlyifexpresslyagreed
withtheseller.FeesaresetbytheTariff
andRegulatoryFee,butallowfor0.5%
–1%ofthepricedeclaredinthedeeds.
• Ifyouarepayingfortheservicesofa
gestoritisimportanttogettheoriginal
invoiceissuedbythenotaryandthe
registrar,andtheletterofpaymentof
taxes,sothateachpartyknowshow
muchtopayforeachoftheservices
provided.
• The Land Registry.Thebuyerpaysthe
leveloffeescorrespondingtothe
registrationoftheirright,andifagreed,
ofthosecorrespondingtotheregistration
ofthemortgage.Registrationfeesare
governedbyatariff,whichyoucan
ascertainateachregistryofce.
Allowfor1%ofthevalueonthedeeds.
• Your lawyer. Theusualrangeoffeesfor
your lawyer–abogado–willbeinthe
€1,500to€3,000range,butthisreally
dependsonthevalueandcomplexities
attachedtoapropertypurchaseandfees
canbeconsiderablymore.
• Mortgage costs. Thiswillincludea
valuationofaround€500plusthe
arrangementfee.Itwillalsoincreasethe
notary’scostsasyouwillhavetosigna
differenttitledeed.
• Bank costs.Youwillneedtowritea
banker’schequeorpayforatransferof
funds.Allow0.5%ofthefundstransferred.
Beforemakinganypaymentensureyou
receiveinvoicesbreakingdowneachelement
ofthebill,theIVA,theidentityandTax
IdenticationNumber(NIF)ofwhoeverhas
issuedthem.Forthoseissuedbynotariesand
registrars,ifyoudisagreewithanyofthe
chargesyoumayappealagainstthemas
speciedbytherulesthatlaiddownthetariff.
Other costs
Municipal Tax on Increase in Value of Land
in Urban Nature: Formerlyknownas
“plusvalía”,thisisalocalcapitalgainstax
basedontheincreaseofthevalueoftheland
sincethecurrentsellerboughttheproperty
andmustbepaidbytheseller.Therate
dependsontheperiodofpossessionandthe
populationofthetownorcity.Buyersneedto
beawarethatifthesellerisnon-residentin
Spain,ifthetaxisnotpaidthenthebuyerwill
havetopayit.
Property Ownership Tax (IBI): Formerly
knownasthecontribuciónurbana,thisisa
localtaxpaidannuallyandbasedonthe
cadastralvalue(valorcatastral)andaccording
withthevalueofthelandandthebuilding,but
usuallymuchlowerthantheactualmarket
value.EachMunicipalitydecidestherateto
beapplied.
Wealth Tax (Patrimonio): Payableannually,
basedonthevalueoftotalnetassetsasof31
Decemberofeachyear,afterthefree
allowanceof€700,000.Fornon-residents,
thiswillbebasedonthetotalvalueoftheir
netassetsinSpain.Theratevariesfrom
0.24%to3.03%atthetimeofgoingtopress.
Asthistaxisappliedindividually,ifthe
propertyisownedbymorethanoneperson
eachofthemwillbetaxedaccordingtohisor
hershareoftheproperty.
32
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
Income Tax for non-residents (IRNR, Renta
de No Residentes):
• Iftheownerrentsthehousetheymust
pay20%oftherent(24%ifthelesseeis
anon-EUcitizen).
• Iftheownerusesthehouseheorshe
pays20%ofthe1.1%ofthecadastral
value(2%ofsuchvalueifithasnotbeen
revisedsince1994).Fornon-EUcitizens,
therateis24%again.
Income Tax for residents (IRPF, Renta de las
Personas Físicas): Anypersonisconsidered
toberesidentinSpainifheorshelivesin
Spainformorethan183dayspercalendar
year.Inthatcase,youhavetoleyourIncome
Taxannually,anddeclareallyourincome
regardlessofwheretheincomewas
generated.
Estate Equity Income Tax (Ganancias
Patrimoniales Inmobiliarias): Calculatedon
thedifferencebetweenthepurchaseprice,
plustaxesandexpenses,andsellingprice,
minustaxesandexpenses,andapplyingan
updatecoefcientapprovedeachyearinthe
Budget.Allnon-residentsellerswillhaveto
pay20%ofsuchadifference,andarealso
subjecttoawithholdingtaxof3%ofthesales
price,paidtothetaxofce.
Rubbish Collection Tax (Tasa de Recogida
de Basuras): Thisvariesaccordingtoeach
propertyandisusuallypaidonceortwicea
yearataratesetbythelocalcouncil.
Water Supply and Sewerage Tax (Tasa de
Abastecimiento de Agua y Alcantarillado):
Payableataratesetbyeachcouncil,usually
fourtimesayear,thisisworkedoutaccording
towaterconsumptionincubicmetres.
Costs other than taxes
• community expenses: forcondominiums
andurbanisations,assetandapproved
bytheGeneralMeetingofOwners
eachyear.
• gardening and cleaning services: the
costsofcommunalgardensandpublic
areasofcondominiumsareincludedin
thecommunityexpenses(seeabove).
Ifpayingfortheseservices
yourself,however,theamountwill
dependonwhetherthepeoplearepaid
bythehourorarecontractedfullorpart
time.Don’tforgetsocialsecurity
contributionstoo,anadditiontothe
monthlypayrollofaround40%ofthe
salary.
• land telephone line and internet: Local
andnationalcompanieswilloffervarious
dealsandpackages,whichcaninclude,
inadditiontophoneandinternet
connection,alsocabletelevision.Such
servicesareusuallypaidmonthly.
• electricityispaidmonthly,withabasic
ratepayablewhetherthepropertyis
occupiedornot,andaminimumthatwill
varyaccordingtotheestimateduse.
33
THE AIPP / RICS / RDE GUIDE TO BUYING A PROPERTY IN SPAIN
APPENDIX THREE
Related links
Association of International Property Professionals (AIPP)
- www.aipp.org.uk
Royal Institution of Chartered Surveyors (Spain)
- www.rics.org/es
Colegio de Registradores de España (Spanish Registrars Association)
- www.registradores.org
Consejo General del Notariado (General Council of Notaries)
- www.notariado.org
Agencia Estatal de Administración Tributaria (Spanish Tax Offce)
- www.aeat.es
Dirección General del Catastro (General Directorate for Cadastre)
- www.catastro.minhac.es
Confederación Española de Organizaciones de Amas de Casa,
Consumidores y Usuarios (Spanish Consumers and Housewives)
- www.ceaccu.org
Organización de Consumidores y Usuarios (Consumers Organisation)
- www.ocu.org
Asociación de Empresas Constructoras de Ámbito Nacional
(Construction Companies and Infrastructure Commissioners)
- www.seopan.es
Confederación de Consumidores y Usuarios (Consumers Federation)
- www.cecu.es
Asociación Hipotecaria Española (Spanish Mortgage Association)
- www.ahe.es
Asociación de Promotores y Constructores de España (Spanish
Developers and Constructors Association)
- www.apce.es
Consejo General de Gestores Administrativos Colegiados
(Council of Gestors)
- www.consejogestores.net
ConsejoGeneraldelosColegiosOcialesdeAgentesdela
Propiedad Inmobiliaria de España (Estate Agents Council)
- www.consejocoapis.org
British Embassy in Spain
- http://ukinspain.fco.gov.uk/en
Autonomous Communities
Andalucía-www.juntadeandalucia.es
Aragón-www.aragob.es
Asturias-www.princast.es
Cantabria-www.gobcantabria.es
Castilla y León-www.jcyl.es
Castilla-La Mancha -www.jccm.es
Cataluña-www.gencat.es
Ceuta-www.ciceuta.es
Extremadura-www.juntaex.es
Galicia-www.xunta.es
Islas Baleares-www.caib.es
Islas Canarias-www.gobiernodecanarias.org
La Rioja-www.larioja.org
Madrid-www.madrid.org
Murcia-www.carm.es
Navarra-www.navarra.es
País Vasco -www.euskadi.net
Comunidad Valenciana-www.gva.es
Melilla-www.camelilla.es
THE AIPP / RICS / RDE
GUIDE TO BUYING A PROPERTY IN SPAIN
BROUGHT TO YOU BY