If you are looking for information on buying property in Spain, I think you will find this article useful. Settle down to read and take notes because you should know the following facts before you begin to consider viewing properties in Spain.
In this article, we're going to look at the different types of properties available, the additional costs you must consider on top of the property selling price and how you should go about viewing the properties you are interested in.
We will then take a look at how to find the perfect lawyer to help you with the transaction, and how to get a mortgage. After reading this article you will know the basic steps you should take to ensure buying your dream home in the sun is a pleasurable and trouble-free experience.
Which Type of Property?
The usual types of properties you will come across while browsing websites or estate agent window displays, are townhouses, villas, apartments or 'fincas rusticas'.
A townhouse is usually a two or three storey detached building on its own small plot. Many of these will be on purpose built urbanisations, or could be stand alone buildings. They are usually situated in convenient locations not far from the town centre and local services.
Apartments are likely to be in larger blocks, they will often have communal gardens and a swimming pool. An annual community charge will be asked of each apartment owner for upkeep of the building and gardens. You should make sure you know the community charge before purchasing, and be sure all previous community bills are paid, because a new owner will unfairly inherit any unpaid bills from the previous owner.
You should also be aware that the 'Presidente' of the building and a few other residents will decide when the building is to be painted, when balcony fittings are to be uniformly changed etc. When an improvement for the building is decided upon, you will be obliged to pay whether you agree with the proposals or not.
Villas are usually detached houses, or occasionally semi-detached. A villa will have its own garden, and very possibly a pool.
Villas are also generally built on purpose built urbanisations, and it is not unusual to find shared facilities such as a pool, tennis courts, and recreational areas for children.
If you buy a villa, you will probably find you are on the outskirts of the town centre.
A finca rustica is typically a farmhouse type building located in a rural location. The finca is likely to have plenty of adjoining land, which can be used for growing produce or similar.
If you are interested in a finca, one thing you will need to check is the water and electric installations as many of these rural properties are off the grid for electricity. Mains gas is almost certainly out of the question, and often water will be provided by a well. This type of living is obviously not for everyone, while others thrive under these more natural conditions.
When choosing your property type, you should also take note of the proximity of your neighbours. If you move into an apartment block occupied mainly by the Spanish locals, be aware they do not give much attention to the noise levels and generally in most towns, between 9am and 12pm any level of noise is acceptable, and complaints you might make will be ignored.
If you like a quieter life, in Spain you should consider a property that does not have close neighbours.
It is of course also important to find out well in advance how often the public transport runs, especially if you will be relying on it to get children to school or to get to a place of work.
Obviously, you will be paying the selling price of the property, and you should also budget for another 10% of that price to cover the buying costs.
These costs include notary fees, property registration fees, stamp duty and VAT (IVA).
It is customary for the buyer to cover all fees other than the estate agent fees, if applicable, and the 'plus valia' which are the responsibility of the seller.
Once you have decided the type of property you would like to purchase, the area you would like to live in, and how much you wish to spend it is time to begin viewing some properties.
If you live outside of Spain, you will need to spend a lot of time looking at properties online.
You can find properties on estate agent websites, or through private ads which are often placed on English speaking news sites with a classified section.
Be aware that in Spain, anyone can set themselves up as an estate agent without qualifications and there are no rules they have to adhere to, so use your instinct when dealing with agents, and if possible deal with an agent that is a certified member of the Agente de la Propiedad Inmobiliaria (API), or the Gestor Intermediario de Promociones y Edificaciones (GIPE).
These are professional associations that require their members to adhere to certain standards and sit examinations.
Once you have a shortlist of properties, it is recommended you rent a similar property in the area for as long as your schedule permits. Short flying visits do not give you enough time to really get a feel for what it would be like to spend prolonged vacation periods, or to live in the area.
Hiring a Lawyer
Unless your estate agent comes to you very highly recommended from a person whose opinion you trust implicitly, it is advisable to hire an English speaking lawyer to help you through the buying process.
In order to find a lawyer, you can scan the English versions of local newspapers and magazines, or ask for recommendations from other expats already living in the area.
Expat business owners are likely to be able to advise you on a specialist lawyer for your needs in the area.
Obtaining a Mortgage
Up until 2008 it was extremely easy for a foreigner to acquire a mortgage from a Spanish bank. However due to the economic crisis which began to hit Spain hard in the latter part of 2008, Spanish banks have completely clamped down on lending to locals and foreigners alike.
Therefore if you need a mortgage to purchase your desired property, you are likely to have more luck applying to a British bank. British lenders in Spain include:
- Banco Halifax Hispania
- Leeds and Holbeck Building Society
- Newcastle Building Society
- Norwich and Peterborough Building Society
You can also find more lenders in the property pages of UK national newspapers and property magazines.
You now have the basic information you need to proceed with securing your dream home in the sun. At the time of writing in 2010 prices in Spain are at an all time low, and there are no clear indications that things will change in the near future, so it is a good time to buy at a low price.
However, do shop around and as with any large transaction, before buying property in Spain, or indeed in any country, consult a lawyer, trust your instincts and proceed with caution!