A Quick Guide of the Property Buying Process in Spain
We at TPS HOMES will guide you through every step of the buying process, hopefully taking the stress out of buying your dream home.
We recommend that you use a qualified solicitor to complete your purchase and here at TPS HOMES we are happy to recommend one that will look after your interests at the best possible price.
The first important thing is to have your finances in place, which enables you to go ahead with your purchase as soon as you find what your looking for. There are various Taxes and Charges involved in the purchase of property here in Spain, as everywhere.
The Spanish property buying process is very simple. Once we have found you a home which you would like to buy you will normally place a reservation deposit of €3,000 which effectively takes the property off the market and fixes the price.
The next stage is the completion of the private contract of Spanish property purchase.
RESALE PURCHASE COSTS
Transfer Tax (Impuesto sobre Transmisiones Patrimoniales – ITP)
This tax applies if the property is deemed to be a second or posterior transfer (i.e. not the first time a newly built home is bought)
The general rule is ITP @ 10%.
Notary expenses are always paid by the buyer and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate Notary fees as being 1% of the purchase price declared in the deeds of sale. In many cases however Notary fees are more like 0.5% (or less) of the price declared in the deeds.
Property Registry Inscription Fees
Expenses related to inscribing the sale with the land registry are also nearly always paid by the buyer, and are calculated in relation to the purchase price declared in the deeds of sale. To be on the safe side you should calculate 1% of the purchase price declared in the deeds, though once again it depends upon the property and the area, and the fee could be considerably lower.
In Summary, allow for up to 14% of the purchase price in taxes and other costs.
N.B. If the buyer takes out a mortgage these costs can be somewhat higher due to an additional public deed for the mortgage and the inevitable bank charges involved.