Under Spanish law, debts can be linked to a property. What does this mean? Briefly, you can buy a property with a debt attached. You can inherit a debt from the previous owner. That is the main reason why it is so important to do the appropriate checks in the Land Registry Office before completion. By using Spanish Solutions you can be sure the house you will be buying will be free of debts.
Main surprises can come from the Land Registry, but there are many other aspects we also look at such as community administration fees for the common areas (as these debts will be attached to the property as well). Buying a property in Spain is far more different than buying in the UK. Please do not think it is exactly the same.
Expenses involved:-
- 10% tax (ITP in Spanish) based on the purchase price (when buying a second-hand property). It slightly changes when buying a new construction directly from the builder.
- Notary expenses: purchase deeds (“escritura de compraventa”) have to be signed in front of a Public Notary (so there will be a Notary invoice involved).
- Land Registry expenses (Registro de la Propiedad): after deeds are signed at the Notary they need to be taken to the Land Registry in order to be fully registered (there will also be a Land Registry invoice involved).
- Conveyancing fees. Please do not think that we can avoid this, as you may very well regret it. You would be buying blind, without checking that there are no debts against the property (land registry, utilities, community fees; as this is complicated and needs someone fluent in Spanish and understanding the system). Our office treats each purchase (and sale) as if it were our own, and we make it easy for you from beginning to end by arranging for you to provide us with power of attorney (which of course we would not use without checking with the clients all the main issues) and setting up direct debits if you wish for all your utilities and payments so that there is nothing to worry about.
Who To Use?
You might think purchasing a property is a stressful task for buyers. The answer is “not if…”, not if you are using someone familiar with the process to deal with your purchase who make sure everything is checked and under control, which is the main reason you contract their services. You can trust in Spanish Solutions to assist you with conveyancing as our company has 12 years experience.
Too busy?
Too busy to be going back and forth for different appointments and tasks involved in the purchase process? If want this process to be far from a stressful experience you can consider signing Power of Attorney, as we said above. If it is not possible for you to sign it in front of a Spanish Notary we give you the instructions you will need to sign it in your country, we are always available to offer you the best solutions. A power of attorney is basically an authorisation to allow your representatives to deal with any of the points mentioned on the Power (buying/selling properties, opening bank accounts, applying for NIE numbers, acting as your fiscal representative, etc.). It can be signed in front of UK Public Notary and ratified by the Foreign and Commonwealth Office in order to be used overseas and certified with an Apostille (which is basically a certification to legalise the document so it is valid to be used in all countries joining the Hague Convention. For more information about the Apostille, you can always double check with your Notary). Some people are very wary of signing a power of attorney, having heard stories. Please remember that this document can be used only with your permission or it is illegal and fraud. So if you use a legal registered proper company, there should be no problems. Problems generally arise when giving an unregistered individual power of attorney.
Invoices
After the title deeds are registered, we give clients all their original invoices and always have done (including invoices from the Notary and Land Registry office and we do not charge extra for this). We also give our clients the forms to show that we paid the 10% tax to the Inland Revenue (we, unfortunately, have had legal cases whereby years after it turns out an office dealing with a client´s purchase did not pay their purchase tax to the Tax office. Getting the invoices is very important; for example, many of our clients who are sellers have been unable to reduce capital gains tax as the lawyer they used purchasing did not give them the invoices from when they bought, and they need to be able to prove those expenses. In addition, recently in order to be able to claim against the banks for abusive clauses in their mortgages, clients have had to be able to produce these invoices and for many, it has not been possible. Spanish Solutions do things properly and always have done.
Costs
We believe that it is important that clients are fully aware of all the expenses and that there are no hidden surprises. As soon as you speak to us we can prepare you a spreadsheet with all the costs detailed, so it is absolutely clear how much you will need to find both for the purchase and also an explanation of ongoing costs.
Taxes
People buying a holiday home might believe that house maintenance during the whole year can be very expensive and not worth it if only using it for holidays. That is not really the case as there are only two taxes that homeowners need to pay generally: the local council tax (which is called Suma in the Orihuela Costa region) and the Non-Resident tax. The good thing is both taxes are only paid once a year and are relatively small compared to those in other countries, so you don’t really need to be worried about them. Spanish council tax is apparently much cheaper in Spain according to an article published in 2014 by The Telegraph than the average property tax in Ireland and in the UK (a fact those of us living here know and are grateful for).
Help
Lastly, we are always delighted to help clients before, during, and after completion. We are not an office that deals with you solely on a transactional basis, get the job done and do not care anymore, we look for a long-term relationship with our clients, helping them with many aspects of living, investing, or owning a holiday home in Spain over many years.
Please do try us.