We have good news for you: working with a reliable realtor will make buying a property abroad easy and pleasant.
Main peculiarities of buying a property in Spain
No need for a due diligence. All relevant information about the property could be obtained by ordering an extract from land registry (Nota simple informativa in Spanish) where one can find all relevant data about the owners, mortgages, liabilities and easements related to the property.
No need for a lawyer. The function of checking the legitimacy of a deal is performed by a notary. Before signing the deal, the notary makes sure that there is no debt to owners’ community as well as to water, gas and electricity supply companies, all mortgages are payed off or subrogated correctly, all the owners are present and included in the deed, etc.
Ownership transfer at the moment of signing the notary deed. Although the process of registering the notary deed in the land registry may take one-two months, the property rights are registered at the moment of signing the deed and that means the seller cannot resell the property to anyone else after the deed is signed.
Steps to follow
Selecting a property and putting down a deposit. Once you have selected your dream home it is recommended to put down a deposit to block the property and take it off the market while you are preparing all the necessary paperwork.
Opening a bank account. According to Spanish legislation the payment should be made with a bank check issued by a Spanish bank. One would need only passport or a NIE to open an account, in exceptional cases one could be asked to provide a tax declaration or a payroll in order to show the legitimate origin of money.
Applying for a tax identification number (NIE). It could be applied for either at the Spanish consulate or directly at local authorities of the municipality where the property is bought. Normally it takes from 1 to 8 working days to get it depending on a municipality.
Signing a down payment contract. This document establishes the purchase price and the date of the signature of the notary deed, as well as other relevant conditions of the deal. Normally the buyer puts down a 10% deposit that protects the parts from pulling back, as if the buyer does not proceed with the deal he loses the deposit and if the seller does not want to carry on he pays an amount equal to doubled deposit as a penalty.
Closing the deal and signing notary deed. The final step is signing the deed at a notary office. The document should be signed by each of the owners as well as by each of the buyers. The notary checks all the related documentation (land registry extract, tax and suppliers’ bills, dwelling certificate, etc.) and certifies the deal. The buyer hands the bank check and the seller in turn hands the keys.
Post sale procedures and payments
Although the procedures described below are essential steps of the purchasing process, the buyer is not involved in them directly as they are carried out by a managing company (Gestoría in Spanish) provided by a notary office.
Registering the property. After signing the notary deed it is registered in the land registry of the respective municipality. The expenses related with signing the notary deed and registering it vary depending on the property price and could reach 2% of the purchasing price (the more expensive is the property the lower are the relative expenses).
Paying taxes. New built property is subject to VAT and Stamp duty, 10% and 1,5% rates respectively. In case of second hand property a 10% property transfer tax is payed.
Thereby total expenses of buying a property in Barcelona including notary and registry fees as well as taxes and managing company services are approximately 11-13%.
Kaufmann & Winkel specialists will follow and advise you during all the process starting from looking for a property through completion of all the necessary procedures. The deal will thus be completed with no concerns and headache.