What is the process? What are all the extras you have to pay? How can you be sure the PAPERWORK is in order?
In legal terms, buying a Spanish property falls into two categories: the preliminary contract (Contrato Privado de Compraventa) and the completion contract (Escritura de Compraventa).
Viewing a property Typically, viewings on the Costa Blanca take place with Hot Property on a one-to-one basis. We also often collaborate with other agents to give you more choice – which means that, if a sale is made, we split the fees between us, at no extra cost to the buyer.
Negotiating/making an offer Hot Property will make an offer to the seller on your behalf. In general, there is more scope for negotiation over price and terms when you are looking to buy a resale property privately rather than a new build from a developer. Overall, the buying process is much quicker here than in many other countries.
Deposits Once a final sales price has been agreed, it is necessary to pay a RESERVATION DEPOSIT of 3,000 – 5,000€. This ensures that the property is taken off the market, and therefore inaccessible to other buyers, whilst the contract is being processed. This is a non-refundable deposit, unless there should be any undisclosed issues found during the legal investigation, planning searches, etc., in which case the full amount will be immediately refunded. Although this deposit belongs to the vendor, for security unless otherwise agreed, Hot Property will hold the deposit in the Hot Property Client account until the legal investigation is complete.
Your legal representative must then check a number of points so that you can be sure you will obtain a clear title with no hidden debts.
Firstly, a Property Register extract should be obtained to show whether there are any debts against the property, such as mortgages or loans etc., and to confirm the current owner of the property. A ‘Nota Simple’ will reveal whether a property holds any outstanding debts. Then a check should be made with the relevant authorities – electric, water, rates etc. to make sure there are no outstanding invoices.
The purchaser must then arrange for an NIE/NIF (which is an identification document, with an NIE number) to present to the Notary and pay taxes. For this you will need your passport, one passport photo and a completed application form + two copies, which you must take personally to the Comisaria Office for processing. Your legal representative can arrange this for you. The NIE numbers usually take about three weeks to be allocated. If you already have an NIE number you need to produce your ORIGINAL.
A PRIVATE CONTRACT (Contrato privado de compraven) is then drawn up, stating the terms of the Contract – full deposit payable, date of completion, furniture included etc. This will provide information on the purchase price, the description of the property and the date it will be completed. The full deposit is then also required – typically, approx. 10% of the sale price.
At the Notary, the Final Contract (Escritura de compraventa) will be drawn and the balance of the purchase price (which is the sales price less the deposit) and any other fees, must be paid by the buyer. The Escritura de Compraventa (Final Contract) is then signed by the purchaser and vendor. After signing the OFFICIAL ESCRITURA at the Notary´s Office, you will receive a COPY of the document immediately. After this, another copy is passed to the tax office and to the property registry. In Spain, the Notary Public is a public official who has to witness the sale.
The SERVICES – electric, water etc. – must be signed over in the purchaser´s name and bank authorisations completed and delivered to the relevant offices.
As a matter of courtesy, a Hot Property member of staff will accompany you to the Notary.
Using an official Legal Representative Although Hot Property can guide you through the buying process, it is recommended that use a lawyer during proceedings. In this part of the country you will be able to contact several lawyers, many of whom will speak English. Please ask Hot Property for our recommendations. The Official Escritura will be returned to you once it has been checked and registered at the Property Register, which is usually 3 – 4 months later.
In Spain the buyer is required to pay legal fees for the Notary as well as the property sales tax.
Legal fees from the Notary vary between €400 – 800, and the property inscription fees are 65% of the notary fee. Hot Property recommend you allow an additional 13% on top of the purchase price to allow for ALL taxes, fees, etc.