Buying or selling a home in Spain, like in other countries, is not as simple as going to a store for a pair of shoes. If you have the necessary money, it is not enough to give it to the seller to make the transaction, as it is a good of great value, a legal procedure must be taken to make a property transfer.
The rules and protocols for buying or selling a home in Spain are different in each country, so if you are not a Spanish citizen but are going to buy a home in Spain, you should know how to do it.
Below we explain each step you must follow if you are a foreigner, but as a general recommendation, ask for professional advice before signing any contract.
The debts that a property can have
In some cases, the property may be associated with debts such as mortgages and seizures. The buyer must request this information at the Land Registry before transferring the property, because once the transaction is completed, he will be the one to pay the debt.
If there is a mortgage, the buyer must decide if he wants to become the debtor, paying the bank that made the loan. If so, he must first consult the repayment term, the commissions and the amount that remains to be paid.
The buyer can also ask the bank for their own mortgage loan and wait for it to be approved.
The first step to buying a home in Spain is to know if the house has any associated debt and if so, analyze if it is really convenient for you.
Pre-contracts are not necessary but they make the purchase safer
One of the first things you should learn about buying or selling a home in Spain is that in some circumstances a pre-contract is made; a private contract in which it is guaranteed that the operation will be carried out.
In general, this document is made when the sale of the property is in metropolitan areas or when a developer makes the sale, in this way the buyer will be sure that only he will have the property.
It is very important to previously read everything that is established in this document because both parties are obliged to comply with it. No one is exempted from complying with the agreement, even when the agreement is not of their convenience or because they were not entirely sure of what they signed.
So, the second step to buying or selling a home in Spain is to be totally sure of signing the pre-contract.
Who is the signatory of the Buying or selling a home in Spain?
When the sale and transfer of a property is made, both parties must sign, but many times it is not a transaction between two people; when there are more people involved, everyone’s signature must be present in the contract.
First of all, if the owner is deceased and his heirs want to sell the house, they must make sure that they are the only ones with rights over the property and also have all the necessary legal documents. If one of the heirs does not agree to the transaction, it cannot be sold.
If the house is shared between spouses, both parties must sign the document, the same happens if the house belongs to one of them.
If the transaction is carried out through a developer or a real estate agency, the signature of the administrator, the attorney-in-fact, the agent of the company or the developer must be present in the document.
Finally, when the transaction is made between individuals, the document must be signed by all the holders, either in person or legally represented; in this case, a lawyer must provide his service to make an authorization.
In this way, the third step to Buying or selling a home in Spain is to establish who of the selling party will sign the document, if there are more people involved and make sure that everyone agrees with the transaction.
The expenses of the residential complex
When the property is located within a residential complex, periodic payments must be made for the maintenance of green areas, swimming pools, parks and for security.
The buyer will be the one in charge of this expense once he signs the transfer document, so he should consult with the administrator if there is any debt, arrears and what is the regulation to follow.
If the purchase of a house is to make a commercial property, such as an apartment for tourist rental, the buyer should ask at the town hall if it is possible to obtain a license and what are the conditions.
The fourth step to buy your home in Spain is to know what the expenses of the residential complex will be.
Property price and deposit
The pre-contract establishes the total price of the property, the amount that will be deferred and how the money will be paid; that is, if it will be by installments, by subrogation of the mortgage or by the granting of a public deed.
The most common deposit is the penitential, in which the buyer loses the deposit if the buyer does not fulfill the contract, and if the seller breaches the contract, he must return the double amount.
Expenses incurred in the purchase and sale
When buying and selling a property in Spain, five types of expenses are derived from that transaction.
- Tax on the increase of the value on urban land.
- Public deed before a notary.
- Registration in the Land Registry.
- Taxes.
- Administrative charges, that is, the invoice collected by the notary public to perform certain procedures.
In accordance with the Law, the selling party pays the surplus value and most of the original deed and the buyer will pay for the copies of the deed. This may change if something different is agreed in the private contract.
All public notaries are impartial; however, you could go with a private one when formalizing the public deed. The buyer has the right to choose with whom to carry out the transaction, even if there is a developer or real estate agency involved.
Buying a home is an important operation, so if you have any questions you should go to a professional.