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Service for our clients is since many years the most important
aspect and assumption for a successfull cooperation.
Herewith we would like to give you a ahort information about
buying a property in Spain:
1. The Purchase of a property
in Spain
All citizens of member states of the European Union
are not subject to restrictions when purchasing a property in Spain.
Normally, they have the same rights in Spain / Majorca as local
citizens. If they are registered as owner in the land register of
Spain, they get the same protection with regard to their property in
Spain/Majorca.
2. The Handling of a purchase
According
to the Spanish law, there does not exist an obligation in form when
you are purchasing property. Also oral contracts of sale may be
permissible and legally valid in Spain. Custom in Spain is the
conclusion of a contrato privado, a contract about the option to
purchase the property.
The Contract about the option to
purchase the property
The purchaser receives the property by
the „escritura pública de compraventa“, which is the
notarial contract of sale. This official form of contract is
pre-condition for entering into the registro de la propiedad, the
land register of Spain. With this contract about the option to
purchase, everything has to be arranged. Especially the date has to
be fixed which at latest the escritura pública de compraventa
should have been completed and by this date this property should be
handed over.
The Deposit
At the same time of completing
the contract about the option to purchase, a deposit has to be made.
Common practise in Spain/Mallorca are 10 % of the purchase
price.
The Financing of a property in Spain
The time
between the conclusion of the contract about the option to purchase
and the notarial documentation can be used to prepare a financing, if
it should be necessary.
Notary date, purchase, Escritura
A few days before the Escritura, the notary demands an
official extract from the land register in Spain. With the sending of
this extract from the land register in Spain, the property is blocked
for five whole days. If iot should be the case, that another notary
also demanded an extract from the land register in Spain for the same
property at that time, this would be rejected by the registry in
Spain with an appropriate hint.
Land register in Spain
At
the date with the notary, both, the purchaser and the seller, have to
prove their identity with their passports. Thereupon the notary reads
out the prepared document and notes that the price of purchase has
either been paid before the official signature of the the escritura
or is paid at that moment.
At the same day, the notary sends an
announcement about the contract of sale to the land registry of
Spain. A copy of this official escritura, he later hands over for the
registration in the registro de la propiedad of Spain.
3. The costs for purchase and
following
The purchaser pays for everything -even if the
Spanish law says that the seller and the purchaser have to come to
an agreement about the costs.
Appreciation tax
This is
also valid for the plusvalia, the appreciation tax. In that case the
Spanish law also says that the seller has to pay the tax if about
this point there had been no other agreement.
Therefore the
costs for the complete purchase are the following:
If you
calculate ten percent of the purchase price of this property, that
will be usually enough and you can be on the save side.
Which
are the taxes which have to be paid when purchasing a property in
Spain?
There are also another taxes which have to be paid:
If you purchase a property from
private individuals (second hand object) the transmisiones
patrimoniales, the land transfer tax, at the rate of seven percent.
If you purchase a property
developer (new building) the impuesto valor anadido (IVA) , the value
added tax, at a rate of seven percent.
This is a overview
about all the costs:
The costs of a purchase, are made are the
followings:
Land transfer tax 7% or IVA. 7%
Fees for the
notary and the registration 1 to 1,5%
The annual following
costs, applied to the documented value of the property are the
followings:
Wealth tax 0,2%
Income tax 0,5%
Property tax
0,4 to 0,8%
4. Transferring Money to pay for your property
When purchasing property or living overseas, you may often find you need to exchange large amounts of money to and from Euros (or any other currency for that matter). Many people are unaware that the banks typically take a far larger spread from the interbank rate when they give you an exchange rate- which leads directly to you receiving a far worse exchange rate. This will make a significant difference to the cost of your transfer.
Through our carefully selected foreign exchange provider, World First, we are able to not only save you money on the exchange rate you receive but also reduce your exposure to movements in rates. You can speak to a dedicated member of their team on +44 (0)207 801 9080, quoting Mallorca Properties, or visit their website at www.worldfirst.com
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