Buying property in Spain need not be a daunting prospect, as long as you follow some simple rules. In this guide we will show you the procedures that are necessary to enable you to purchase a property in Spain legally, cost-effective, and with peace of mind.

With this step-by-step guide we will help you to understand the whole process of buying a property in Spain. We will go through the process with you from the beginning to the end.

Regardless of your understanding, whether you have experience or not it is advisable that you use the services of a local English speaking solicitor or “Gestor” to deal with the purchase of your property. He will deal with all the legal paperwork on your behalf as well as speaking to all the relevant Authorities involved.

Step by step guide.

1 Find a property/make a offer.

Obviously before you can purchase a property, you need to find one. There are two ways in which this can be done. An organised “whistle stop tour” or a house hunting holiday. We highly recommend the second option because this will allow you more time in a specific area. From our experience, it is generally a good idea to rent a property in the area in which you are thinking of buying, to ensure that you are making the right decision.

Once you decide which property you are interested in you then need to make an offer. Once the offer has been accepted, you will need to find a Solicitor or “Gestor”. He will guide you through the legal formalities and answer any questions that you may have. Our company can provide you with the names of local English speaking solicitors in the area. You can however choose to enlist the services of a solicitor or “Gestor” of your own choice.

It is very important to ask the solicitor for the cost of buying a property in Spain. We will explain later, but on average the property price will increase by 8%.

2 Before purchasing a property.

Once you have decided you wish to purchase a property your “Gestor” will contact the land registry to ensure that the property is available for sale, and if there are no problems you will be asked to put down a deposit (normally 10% of the asking price). This deposit then forms the contract between buyer and seller. You will be asked to sign the contract which includes the buyers and sellers details, the property details, the price and the title deeds signing date. If you subsequently decide to pull out of the deal, you will lose your deposit. If the seller reneges on the deal, he has to refund double the deposit. This is normal practice in spanish law designed to ensure that the buyer and seller are serious.

Now that you have paid your deposit, under normal circumstances the house will be yours. Your solicitor or Gestor will organise everything on your behalf to ensure that the purchase will be completed successfully.

3 Title deeds signing process

Before signing the title deeds it is necessary to discuss with the solicitor the method of payment. In Spain the remaining balance on a property is divided into two categories, declared and undeclared value. Normally you will pay between 50 to 60 percent of the property value by cheque or bankers draft: this money is then declarable and subject to a 7 % tax levy. The remainder of the balance is then paid in cash, this reduces the amount of tax payable and is widely practised in Spain when buying property.

Other fees payable are notary fees, approximately 1% of the declared value, land registration fees, approximately 0,5 % of the declared value, and the solicitor or Gestor fees, between 600 and 1800 € (depending on area).

Although all these fees are payable after completion, it is normal practise to leave a deposit with the solicitor or the Gestor in advance, he can then pay any fees due without any unnecessary delays.

Once the details have been finalised, an appointment will be arranged for you to visit the office of the notary to sign the title deeds. your solicitor or Gestor will have already checked the following details for you:

- The mentioned land registry information
- Former utility bills are paid and up to date.
- The Council tax is paid
- The Catastro information. Catastro is a Council Department responsible for all land and planning archives. It is advisable to check that the Catastro information agrees with the land registry information.

Then you will proceed with the signing of the title deeds. Present will be the notary. He is responsible for ensuring that the title deeds are in order and once signed in his presence they become a legally binding document.

Buying with a mortgage.

If you are purchasing a property using a bank loan or a mortgage, the situation is very similar to buying a property in England. The bank will arrange for someone to view the property and value it. Then an official from the bank will accompany you to the notary office. If you have purchased your property using a mortgage, you will incur separate fees, for example a valuation fee (appr. 250 €), and duplicate document fees (appr. 500 €) plus a 0.5% stamp duty on money borrowed.

4. After signing title deeds.

After signing the title deeds, the house is now yours. You will receive your keys on the day of signing in the notary´s office. You are now free to move in whenever you choose. Your solicitor or Gestor will now carry out the following:

-pay the transfer tax.
-pay the notary fees. This includes a copy of the title deeds (escritura). The original copy remains in the office of the notary.
-ask for the Land Registry registration. This can take between two weeks and two months depending on how busy they are.
-notify the utilities companies.
-change the ownership of the finca in the “Catastro”.

Buying a plot of land to build your own house.

If you are intending to buy a plot of land, it is highly recommended that you use a solicitor to check the boundary details, as these are not always very clear when viewing the local plans.

Once your solicitor or Gestor are happy with the details, and the purchase of the land has gone through, you will need to employ an architect. then he will draw the plans up and if you are happy with the final draft he will send them to the “Colegio de Arquitectos” for approval. This normally takes approximately one month. Once the plans are returned to the architect he will then submit them to the local authority (Ayuntamiento) who issue the building license. This normally takes six weeks. When the license has been issued you can then start building (It is common sense to use only approved builders and to get more than one quote. Feel free to ask them to show you previous projects. ).

The fees charged by architects in Spain are between five and nine thousand euros, on top of which you need to pay for the building license ( appr. 3% of the building cost).

Once the house is built you will need to register it with the “Ayuntamiento” who will inspect the property and issue the “cédula de habitabilidad” (certificate of approval).

Finally the notary will issue you with your house title deeds (escritura) and this house will be submitted into the Official Land Registry, the cost of which is as follows:

- 0,5% house value ( stamp duty).
- Approx. 400 € notary fee.
- Approx. 350 € land registry fee.

To conclude with, buying a house or a plot of land is a very easy process if you use professionally qualified people at all stages of the procedure. In Spain there are very good estate agents, solicitors and building companies, so it is often a very good idea to enlist the help of someone local who has had prior dealings with them.

(This guide is compiled by Pedro M. García Belmonte (Spanish solicitor). For any suggestions, comments or enquiries about this guide or other legal questions please e-mail to gbelmonte@gestores.net. All rights reserved. No part of this guide may be reproduced or transmitted in any form or by any means without prior permission from the author)