Buying or Renting Spanish Property
Buying a Spanish property , or renting a Spanish property and moving to Spain is probably one of the most challenging decisions you will ever make. Spain can be beautiful in the summer but freezing or inaccessible in the winter so we would recommend renting in the area you want to move to before thinking about purchasing your ‘dream' Spanish property. Caution is advisable when looking at properties for sale in Spain as Spanish property transfer taxes mean that if you find out the hard way after moving in that the location is not for you, you may have to pay a hefty 30% capital gains tax on your Spanish property if it was registered for a low amount when you bought it.
There has been a Spanish property boom on the coasts of Spain in recent years and Spanish property prices have doubled in some areas in 18 months and the cost of Spanish property for rent has also risen steeply. If your budget is tight, you may wish to start looking for properties for sale in Spain a few kilometres inland in areas such as Velez Rubio.
Whether you buy or rent a Spanish property, do check that all utility bills have been paid before you agree to the contract. The utility companies in Spain are not as flexible as they are in the UK and you will be liable for any outstanding amounts.
Buying Spanish Property
For anyone considering Spanish property for sale, the single most important piece of advice is to find a good solicitor. Do not simply rely on the Spanish property agent or the word of a friend. Most of the horror stories about people buying Spanish property that doesn't exist or that have an enormous mortgage attached to them involve people who did not follow this simple advice.
Buying Spanish property is not really that complicated. Firstly you should make sure your solicitor checks the Spanish property registry, which will show immediately if the seller owns the Spanish property and whether there is an outstanding mortgage or debt which can be passed on when you buy the property. Then, unless you are paying in full and in cash immediately, a private contract is drawn up containing all the details (description of the Spanish property for sale, purchase price, date of completion etc.) and you will be expected to pay a deposit. The amount of the deposit can vary, but is usually around 5-15%. Finally when you have paid in full, you will get a public deed of conveyance (escritura) which will be issued in front of a Notary Public and will then be passed to the tax office (see below) and on to the Spanish property registry.
Be aware that you will also have to pay tax when you buy a Spanish property. The amount you pay will vary depending on the type of property for sale and the nature of the seller. If the seller is a Spanish property developer you will pay 7.5% in VAT and stamp duty unless the Spanish property is a piece of land or commercial property, in which case you'll pay 16.5%. If the seller is not a property developer on the other hand, you should pay 6% in property transfer tax.
In addition you will have to pay your solicitors fees, Notary fees and the Spanish property registry inscription fees. If you allow 10% on top of the value of the property you are buying to cover the Spanish property taxes and fees then you will finitely end up with change.
Renting Spanish property
The best places to look for Spanish property rentals are the local newspapers and property agencies. In tourist areas there are several English language free papers advertising both short and long term lets, although you may find that you can get a better deal if you go to a Spanish estate agent .
There are two kinds of Spanish property rental contract. Long term lets are cheaper and usually run for one year, but you automatically have the right to renew for 5 years. When a Spanish property contract is renewed, the landlord is only allowed to increase the rent by the rate of inflation, although many foreign landlords appear to be unaware of this. You can only be evicted from a Spanish property you have rented if you fail to pay the rent, or if the landlord's finances become so bad that he has to move into the property.
Short term or holiday lets on Spanish property can be found for 1,2,3 and even 11 month periods. These types of Spanish properties will be more expensive than long-term Spanish property rentals.
As in the UK , you'll be asked for a month's rent as deposit on any Spanish property. If you rent a property at the top end of the market, you may be asked for a bank guarantee or pay more than one month's deposit.
Spanish Property links :
Spanish Property for Sale in Almeria
Spanish Property for Sale in Costa Blanca
Spanish Property for Sale in Costa Calida