Advice from CASA:UNA, current owners, people who have bought a villa in Spain, and general advice.
Buying a property in Spain is very different from that in many other countries. The transfer of ownership takes place at a Notary to ensure that the trade is correct and in line with Spanish laws. The notary must not be confused with a lawyer.
In Spain it takes approx. 2 to 3 months to complete a sale, and a public notary appointed is in charge of the deal.
There are three phases of real estate trading in Spain:
1. Reservation, € 5000
Once you have found your new home, do not hesitate to book it so that it is not sold to someone else. This is done with a simple reservation agreement of a single page, and you have to pay €5000.
If you change your mind, you will lose the booking amount, and if the seller have second thoughts, the amount will be returned to you. In practical terms, the money is in the client account of CASA: UNA and can therefore relatively easily be returned.
This is when the legal status of the property, ownership, etc. will be clarified.
2. Private contract, 10% of the purchase price.
At this point a fixed agreement is made and buyer pays 10% of the agreed price of the property (excluding the €5000 already paid).
Now the details of the property is in place, and the agreement must be "locked" so that steps regarding possible financing can be started and possible minor irregularities can be corrected (eg registration of newly built garage, etc.)
If you at this point change your mind and decide not to buy, the money paid will not be returned to you. If the seller on the other hand has second thoughts, the amount paid will be returned to you twice. In practical terms, this amount is held in sellers account.
3. Notary, deed, the rest of the amount is paid
Everybody shows up at the notary: Seller and buyer and/or their representatives. The Bank providing the loan (if relevant). The bank which granted a loan to the previous owner (if relevant). The estate agent will normally be there as well.
A review of the deed is made, and the notary comes in to ensure everything is done correctly.
In the course of 1-2 hours it is all over. The money and the keys to the property has changed hands and now you can move into your new home.
The previous owner (seller) has at this point vacated the property.
Finance - mortgages in Spain
You can take up a loan in Spain, and borrow some 70% of the price of the property or the appraisal (valuation) made by a rating agency appointed by the bank (the lower of the two).
In addition you should take into account expenses for taxes, fees, lawyer and loan costs. This make up approx. 13% (with the new IVA as of Sept 2012) of the purchase price and normally the bank will not grant you a loan for this amount.
Example: Agreed selling price of € 215,000, the bank estimates it at € 200,000
70% loan of € 200,000 = € 140,000
This means that you must find financing of the remaining amount of € 102,950 (€ 215,000 + 13% taxes - € 140,000 loan)
We have collected general advice for buying a property in Andalucia Spain. Please feel free to comment and request additional information regarding advice to buy a villa or apartment in Spain.
Key words: Property advice Spain, Advice villa Spain, Advice apartment Spain, advice property investment spain, Malaga Estate Agent, Spanish