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Buyers guide

Buying Property in Spain

Owning a Spanish property whether for weekends, annual holidays or a permanent residence is becoming a reality for a growing number of people.

Holidays can be wonderful relaxing experiences but for most people they are only a couple of times a year and since they are often in locations or accommodation not visited before, they can be a gamble. Buying a home in Spain ensures that you know the location and accommodation and can do what you want with the property to make it a real "home from home”. Transport within Europe has now become so swift, frequent and inexpensive that it is possible to have a home in a wonderful location (and climate) which is near enough to visit for weekends. Once there you can simply relax, or use it as a base for exploring the surrounding areas. You'll be surprised at how much you can fit into a weekend and still feel relaxed at the end of it.

With Europe's ageing population more and more people are coming up to retirement at a younger and younger age. Often their children have flown the nest and many are now selling their homes and opting for something smaller whilst investing the monetary difference in a Spanish property.

Then there are younger couples, probably with two good incomes & a taste for foreign travel. Investing in a home in Spain makes an interesting alternative to squirreling it away in a pension fund. Chosen carefully, a property in Spain, especially Nerja, should gain in value & provide a reasonable return from rentals while providing idyllic holidays whenever you choose. It could even be an eventual retirement home.

Of course, there's no shortage of people willing to make an even more substantial commitment by moving lock, stock and barrel to Spain. Now we have faxes, mobile phones and the internet an increasing number of people are no longer working nine to five from a fixed location but are able to relocate their business overseas.

So, for all these and many more reasons escaping cold, grey and expensive Northern Europe, in favour of the finest European climate, may be the best move yet!

Buying Costs of Property in Nerja, Spain

Before you purchase, we will explain all the relevant fees and taxes payable on your Spanish property, so that you can plan accordingly. As a rough guide, you should budget that the combined total of all these amounts will be approximately 7% of the agreed sale price price.

Arranging Finance to Buy a Property in Spain

With the lifting of almost all exchange controls, both residents (in Spain) and non-residents may now obtain loans and mortgages against their Spanish property in any currency from any bank in the world.

The good news is that inflation and interest rates are currently low in Spain & Spanish bank mortgages are amongst  the lowest in Europe. At the moment it looks an attractive proposition to take out a mortgage in Spain. Normally the maximum term for a non resident Spanish mortgage is up to 25 years on 70% of the valuation of the property. There are lots of different packages available & we suggest you use the services of an experienced international bank who will explain the pros and cons as well as providing you with a mortgage that will suit you best at the most favourable rates. We will of course, assist you with introductions & guide you through the process.

Legalities of Buying Property in Spain

There are differences between buying a property in the UK and in Spain. The following brief guide explains in simple terms the process of purchasing your Spanish property - hopefully enabling you to proceed with confidence and peace of mind. It does not cover all aspects of Spanish property law.

It is advisable that you have your financial arrangements more or less in place so you are ready to proceed quickly (refer to finance section).

It is not essential to use a lawyer to purchase a property in Spain, although many foreign buyers choose to do so.

In the case of resale you should check that the property belongs to the seller, it has the necessary building permissions and is free of debt (we do this on your behalf), because under Spanish law any debts will pass to the new owner. For new construction the same checks should be made on the land along with a background and financial check on the builder.

Your purchase is secured when both parties sign a private contract & you pay a non refundable 10% deposit. If the vendor does not complete the sale of the property, Spanish law states that the deposit will be returned together with an additional amount equal to the deposit, as compensation.

At this stage you should obtain your NIE (foreigner’s identity number). This is your unique number used to set up accounts for utilities like electric, water & local rates (IBI).

If you cannot be present in person to sign the contract, a representative can sign on your behalf. However, if you cannot be present to sign the transfer deed (Escritura) you should grant your representative a power of attorney so he/she can complete on your behalf.

The contract will state the dates for subsequent payment of the balance due, which needs to be carefully observed. On completion day both parties or their representatives with power of attorney will appear before the Notary, who is a government official responsible for the execution of public documents and to ensure compliance with Spanish law. The Notary acts for neither party but witnesses the signing of the Escritura de Compraventa (the transfer deed). At this time the balance of the purchase money will be paid to the seller and any remaining purchase tax and fees will be paid. You will then have the keys to your new property and a copy (Copia Simple) of the title deed until the formal deed comes to you from the land registry.

At this point you should set up accounts for utility services such as water and electricity etc. Payment of which can be made through your Spanish bank.

On a final note it is worth considering that the inheritance laws in Spain are in the process of change & are different than in other countries. It is therefore advised that you make a local Will to suit your wishes.

Buy with Confidence - Buy with C&G

Buyers guide

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