Buying property in Spain can be an exciting but complex process, with many questions arising along the way. From legal requirements to taxes, it’s important to have all the information to make informed decisions. At Torregolf Homes, specialists in properties on the Costa Blanca and Costa Cálida, we’ve created this guide to answer the most frequently asked questions about purchasing property in Spain.
What documents do I need to buy property in Spain?
To purchase a property in Spain, you’ll need:
- NIE (Foreigner’s Identification Number): Required for any financial transaction.
- Valid passport or ID.
- Proof of funds: Typically a bank certificate showing you have the necessary money.
- Spanish bank account: Needed for paying taxes and local fees.
What additional costs should I expect beyond the purchase price?
The purchase price isn’t the only cost involved. Additional expenses include:
- Taxes:
- VAT (10%) for new builds.
- Transfer Tax (ITP): Ranging from 6% to 10% for resale properties (varies by region).
- Notary and registry fees: Approximately 1%-2% of the property price.
- Legal fees: Typically 1%-2% if you hire a lawyer to manage the purchase.
- Appraisal and mortgage fees: If financing is involved
Can I get a mortgage as a foreigner in Spain?
Yes, it’s possible. Spanish banks generally offer up to 70% of the purchase price for non-residents and up to 80% for residents. To apply for a mortgage, you’ll need:
- Proof of income (recent payslips or tax returns).
- Recent bank statements.
- A credit report detailing current debts.
How do I ensure the property is debt-free?
Before finalizing a purchase, it’s essential to confirm that the property is free of debt or encumbrances. A lawyer or real estate agent can assist you by:
- Requesting a nota simple from the Land Registry.
- Verifying that property taxes (IBI) are up to date.
- Checking for outstanding mortgages or liens on the property.
Do I need a lawyer to buy property in Spain?
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While not mandatory, hiring a lawyer specializing in real estate law is highly recommended. A lawyer can:
- Review the purchase contract.
- Ensure the property complies with all legal requirements.
- Handle the registration process and secure the proper transfer of ownership.
What is the property tax (IBI)?
The IBI is an annual property tax that all property owners in Spain must pay. The cost varies depending on the property’s cadastral value and location but generally ranges between 0.4% and 1.1%.
What is the difference between buying a new build and a resale property?
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New Build:
- Subject to VAT (10%) and Stamp Duty (around 1.5%, depending on the region).
- Modern and energy-efficient properties.
- Better warranties for construction defects.
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Resale Property:
- Subject to Transfer Tax (6%-10%).
- Often located in established neighborhoods.
- May require renovations.
Are there restrictions for foreigners buying property in Spain?
No, anyone can buy property in Spain regardless of nationality. However, there may be specific restrictions in military or protected zones.
What is the Golden Visa, and how does it work?
The Golden Visa is a residence permit granted to investors who purchase property in Spain valued at €500,000 or more. Benefits include:
- Residency for the whole family.
- Access to Schengen countries.
- No requirement for permanent residence in Spain to maintain the visa.
What should I consider before buying a property for rental purposes?
Investing in rental properties is an attractive option in Spain. Before buying, consider:
- Local regulations regarding short-term rentals.
- Rental demand in the area.
- Maintenance and management costs.
Conclusion
Buying property in Spain can seem complex at first, but with the right guidance, it can be a smooth and secure process. At Torregolf Homes, we’re here to answer all your questions and guide you every step of the way, ensuring you find the perfect property on the Costa Blanca or Costa Cálida.
