The Petra Honig Guide to buying a Spanish Property
Buying A Property
With more than 22 years experience in the property business both in th UK and Spain we are totally aware of how big a step buying a homeis, especially somewhere like Spain.
Our experienced multi-lingual staff based in our Quesada head office and Villamartin offices on the Costa Blanca will be able to help you with every aspect of your Spanish property purchase.
From your first contact with us we will endeavour to identify your requirements and provide you with relevant options that fall within your budget and will help you find the best value for your money that is currently available when buying a Spanish property. We specialise in both Resale and Brand new homes, to suit all budgets, both on the coast of the Costa Blanca and further in land.
Our consultants will be happy to answer any queries you may have and will provide you with all the background information and services to ensure that your buying experience is a happy one and that you make the most of buying your Spanish property.
Whether you are in Spain or abroad your dedicated consultant will work with you to find the right property. We have access to in excess of 1,000 resale properties in addition to new developments, your consultant's expertise will help narrow the field of search down to the relevant options and your ideal home.
We do not arrange inspection trips. Our Clients tend to be independently minded individuals who prefer to travel independently. During the house hunting process we will provide total support and will always be available for help and advice.
The Spanish property buying process is very simple. Once we have found you a home which you would like to buy you will normally place a reservation deposit, which effectively takes the property off the market and fixes the price.
The next stage is the completion of the private contract of Spanish property purchase.
RESALE PURCHASE COSTS
Transfer Tax (Impuesto sobre Transmisiones Patrimoniales – ITP)
This tax applies if the property is deemed to be a second or posterior transfer (i.e. not the first time a newly built home is bought)
The general rule is ITP @ 10%.
Notary expenses are always paid by the buyer and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate Notary fees as being 1% of the purchase price declared in the deeds of sale. In many cases however Notary fees are more like 0.5% (or less) of the price declared in the deeds.
Property Registry Inscription Fees
Expenses related to inscribing the sale with the land registry are also nearly always paid by the buyer, and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate 1% of the purchase price declared in the deeds, though once again it depends upon the property and the area, and the fee could be considerably lower.
In Summary, allow for up to 13-14% of the purchase price in taxes and other costs.
N.B. If the buyer takes out a mortgage these costs can be somewhat higher due to an additional public deed for the mortgage and the inevitable bank charges involved. In this case transaction costs might reach between 15% and 16% of the value of the property purchased.
A special reference should be made to the local capital gains tax – known as Plusvalía. This is a local / municipal tax that only applies to the increase in value of the land upon which urban properties are built, and that is levied at the time of transfer of such properties. It is calculated on the basis of the valor catastral (an administrative value that is usually lower than the market value, sometimes considerably so) of the property. The amount to be paid will depend on how long the seller has owned the property: the longer the period of time during which the seller has owned the property, the higher the amount of tax.
This tax is to be paid by the seller.
Capital gains tax
Spanish property sold by a non-resident owner will be charged capital gains tax at 24.75%, with a 3% withholding provision which is retained at notary appointment, this is then decuded from the 24.75%.
Finally you will complete the purchase of your Spanish property. This is the day you will receive the keys and can start enjoying your new home. Even after purchase, whether you need pool or garden maintenance, small or large building work, we are here to help.
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