Buy a house or villa in Spain
Why buy in Spain
- Spain has an average of 300 days of sunshine per year and 7905 kilometers of coastline.
- Spain is also one of the countries with the best quality of life in the world, usually in second or third place, and has a universal health system.
- Because of its characteristics, Spain is the ideal place to have a house or villa, on the coast, in a village or urbanization and of course, in the outskirts of the cities.
- In addition, the country has been concentrating its population in large cities, in 2018 the 80% of the population lived in cities.
- This has left the countryside free and has opened up investment opportunities, both for productive exploitation and real estate investment (hotels, second homes, etc).
How are real estate sales and purchases made in Spain?
In Spain the majority of sales and purchases are made through a real estate agency and although the form may vary, there are several common elements:
1.- Negotiation phase. The price is negotiated, as well as how and who pays the real estate agent’s commission, and a reservation document can also be signed.
2.- Penitential Deposit Agreement. It is a private contract of sale with the delivery of a money as deposit, which must be returned doubled by the party that breaches the contract. It supposes the delivery of about 10% of the final amount of the purchase.
3.- Sale and purchase before a Notary Public and elevation to public deed. It is the formalization of the private sale before Notary, with its subsequent deed of sale that is elevated to public.
Initial requirements
ID Documents
It is especially important to have a valid passport. Without a valid passport it is not possible to obtain the NIE number. It is a necessary requirement whether you are a citizen of the European Union (Certificate of Registration as a Citizen of the Union or Green Card) or a non-EU citizen.
Other documentation, such as a marriage certificate, may be required. This is necessary in cases where someone who is married decides to buy. It may be requested to justify the matrimonial property regime.
NIE (EU Citizens)
The NIE number is only the number itself. It is a unique number that serves to identify the person in Spain. A citizen of the Union to buy a property, only needs the number. If he/she needs to be in Spain for more than three months, it will be necessary to obtain the Certificate of Registration of Citizen of the European Union. With this certificate (called green card), the European citizen is given at the same time the NIE number.
NIE (No EU Citizens)
As a non-EU foreign citizen, you can buy a property in Spain without being a resident. In this way, you will only have to obtain the NIE number. If you also want to obtain residency, the easiest way for a non-EU citizen is to obtain it through the procedure for investors or Golden Visa.
In any case, having your property in Spain does not require to have the residence and neither to enjoy it as a tourist and/or to rent it the rest of the year.
Obtaining your NIE outside Spain.
There are several options to obtain a NIE without doing it personally or outside Spain. To obtain it through third parties, powers of attorney must be executed in favor of those who manage it. Thus, it can be requested in Spain for the client, being the client in another country through someone who manages it.
If the client wants to obtain the nie while outside Spain, it will be necessary to go to the consulate, requesting appointment. Also, it can be done by a third person.
This process is best done by professionals and I take care of managing it for the client.
The first requirement is to have valid identification documents from your country of origin. With them, it is essential to start the process to obtain your NIE (Foreigner Identification number) number in Spain. This process will vary depending on whether you are a citizen of the European Union or not and whether you can come to Spain in person or need to obtain it from your country. Through me I can put you in contact with professionals to obtain it or advise you.
The Lawyer’s work
The work of the lawyer consists of carrying out the sale and purchase avoiding the problems that can arise. In order to do so, the lawyer must perform a series of actions that can be divided into three phases. These phases can be summarized as follows:
1. Preparation of the purchase
- Contact with the client (videocall), explanation of the service, operation of the sale and purchase in Spain, taxes, etc.
- Negotiation with the seller/real estate agent, of the price (if the service has been contracted), of the reservation document, of the conditions of purchase, etc.
- Investigation: the lawyer checks the legal status of the property, its sale price, tries to detect hidden defects, possible professional appraisal by a technician, urban planning, etc.
- Review of the structural condition of the property, through the ITE or through an architect (optional).
- Checking the urban planning situation or the existence of a residential area (organized community), possible debts, legal requirements of the property (certificate of habitability, energy certificate …).
- Accompaniment in the process of obtaining financing.
- At this point the lawyer will advise you whether or not to continue the operation.
2. Private purchase contract with “Arras penitenciales” (earnest money contract or penitencial deposit,etc)
- The study of the operation begins with the Notary’s office and the Gestoria is contacted.
- Review of documentation, dangers and charges.
- Negotiation of the amount to be paid as earnest money (penitential deposit).
- Drafting/modification/revision of the private purchase contract with Arras/deposit.
- Legal management of the client’s needs in the contract.
- Accompanying in the signing in person, or by means of legally binding telematic signature.
- Management with the gestoria (fiscal private agency), provision of funds for taxes.
3. Purchase and sale before the Notary and the public deed
- Study and realization of the purchase and sale operation with the Notary’s office, giving the maximum security to the client.
- Management of the charges detected in the property and their cancellation.
- Management with the bank and notary: existence or not of mortgage.
- Management with the agency, payment of taxes.
- Accompaniment before the notary the day of the signature of the Public Deed.
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How long does it take to make a real estate transaction?
A sale and purchase in Spain is not done in one day. In general, it takes several weeks, being a couple of months the most normal. The reality is that it depends on many factors. If the buyer has all the documentation, including the NIE, and no financing is needed, the time can be shortened. The seller also needs to present documentation, such as the energy certificate or the certificate of occupancy, but the timing is set by the buyer.
Regarding obtaining financing (mortgage) it usually takes at least a month. Once you have chosen a bank and an offer, you have to contact the bank and be accepted after a feasibility study. You receive the FIPRE (Pre-contractual information sheet), which is non-binding. The appraisal is carried out, it usually takes a week. The FEIN and FIAE (European Standardized Information Sheet and European Standardized Warnings Sheet) are delivered, which are already binding. Then it is necessary to wait a minimum term of 10 days (14 days in Catalonia) and after this term, it will be possible to sign before notary (with a minimum term of 24 hours).
Complexities of buying a house or a villa
In the purchase of a house or villa the concealment of information is generalized, both by the private seller as well as by the real estate agent and it is not always possible to complain after. That is why it is essential to contact an independent agent, such as a lawyer, to check these things before binding yourself. One of the main things to be aware of is the urban planning situation, to make sure that everything is in accordance and that you are not going to find your property expropriated. This is something that in my experience is never looked at properly and is vital. Another thing to check is whether it is part of an urbanization, as there may be debts or obligations. Also, in this type of purchase you should always check the structural situation of the house and find out who built it and when, in order to know the state and/or be able to make a claim. There are other issues, some of them are surprising, such as the existence of military zones where it is forbidden to buy to foreigners.
For all these reasons, it is essential to consult a lawyer, as he is the only one who will look after your interests. This is especially important in the case of independent properties, due to their specific complications.
Only a good lawyer works for you during a sale and purchase transaction.
How are our fees calculated?
As for fees, attorneys charge a percentage of the transaction. Our firm does not charge by the hour, but by the transaction itself and by liability. We do not charge in advance and charge by phases, all of which is regulated by contract.
In any case, the client can always stop the process and will only be charged for the work done. This is a service focused on customer satisfaction.
The price ranges between 2% and 3% plus VAT. Real estate agencies usually charge between 3 and 7%. The price range will depend on the responsibility, the labor involved in the operation, the price and other factors, such as the value of the property (the higher the price, the lower the percentage).
A fair price is negotiated with the client, depending on the operation and their needs. This price is a closed price negotiated at the beginning of the operation, seeking security and peace of mind for the client.
