Buying property in Spain: Top Tips from our Spanish lawyer (Part 2)
- Check for amenities/services and visit the area at different times of the year
A very important point to consider. A town may look very vibrant in the summer months but could be deserted during the autumn and winter months! It would very much depend on your plans and the use that you intend to get out of your Spanish property. If you want to spend more than the summer months you might want to make sure that you do not feel isolated, although others might indeed like that idea!
tional 10-12% to cover costs related to the purchase and taxes
New properties are taxed differently to second hand properties. A property that is sold by a developer will attract Spanish VAT and stamp duties whilst an existing property that is sold by its existing owner (second hand) will only attract Spanish transfer tax. Additional costs will be notarial and land registry fees in Spain plus those of your independent Spanish lawyer, survey fees, NIEs etc.
- Seek independent legal advice from a Spanish Lawyer
This is a very important point. The purchase of your Spanish property will be one of your life’s most important investments and you want to get this right. The Spanish system is very different to the UK system and you need to appoint and engage the services of a Spanish lawyer who can advise you independently thought out the transaction. You may be recommended a Spanish lawyer but it is very important that you choose a lawyer who is indeed independent and not tied to any agent, developer or another party in the transaction.
Another important consideration is whether you want to appoint a lawyer who works for a Spanish firm or whether you want to appoint a Spanish lawyer who works for a UK firm. Many clients will decide to appoint a UK firm of solicitors as this gives them peace of mind. They know the service that they can expect from a UK firm of solicitors and they also know that their lawyer will not only be qualified in Spain but also in the UK which widens the spectrum of the advice that they can receive whilst the lawyer is also familiar with the UK system which avoids unnecessary gaps or the “lost on translation” feeling.
- Review the ownership structure at the outset
Many are the options available when it comes to the ownership structure and none that fits all. Options to consider go from personal ownership to also include family members or life interests, to corporate structures including Spanish and UK companies. Your Spanish lawyer will assist you liaising also with your accountant to decide on the best option for you.
- Check any charges on the property and outstanding debts
When you purchase your dream Spanish property, you want to make sure that you purchase the property with no burdens, charges or debts. No purchaser will want to have the nasty surprise, after the event, that the property is mortgaged and the charge has not been removed or that there is right of way over the garden or any other unwanted charge that may affect the use and enjoyment of your dream home in the sun.
- Consider a survey on the property
Any buyer will also want that the property that they are purchasing is in a good condition. Sometimes the purchaser may be satisfied with the general overall good aspect and condition of the property however this should not be overestimated. An architect will spot things or potential defects that you as a purchaser may not see or consider.
It is also not unusual for the areas of a property not to be accurate with the information registered at the local land registry. Having an independent survey will flag any discordances between the real areas and those actually registered.
As part of the survey report the architect would also usually value the property which will help you as it would confirm whether the price that you are prepared to pay for the property is such that you should pay or not.
- Contact a currency exchange company to obtain a quote for the exchange rate/purchase of Euros and compare with your bank
Exchange rates fluctuate constantly and it is therefore advisable to contact a currency exchange company to obtain a quote for the exchange rate that they could offer. You could then compare this with the rate offered by your bank and see if this would be of interest. It would not be the same if you were purchasing only a small amount of Euros that if you were investing a large amount of money however no matter how small or large the savings are they are always savings that you are making and that can be invested in your new Spanish home!
- Obtain an NIE
Everyone with an economic interest in Spain needs to have an NIE. An NIE is a number which is allocated by the Spanish Authorities and that it is required to purchase property in Spain or open a Spanish bank account.
- Open a Spanish bank account
It is recommended that a Spanish bank account is opened before you complete your purchase as you might need to transfer part or all of the purchase funds to your Spanish account in order to organise the completion of the Spanish purchase. Other options may be available but the most common way of paying the purchase of the Spanish purchase price is by way of a Spanish bank draft and therefore the need to have the Spanish bank account ready and operative before the completion of the purchase of your Spanish property. Our Spanish lawyer will be able to assist you on this and discuss the different options available.
The account will also be of good use to organise all the relevant direct debits for all the house utility supplies, local council tax, communal/management fees etc.
- Obtain succession advice and organise inheritance tax planning
Everyone’s personal, family and financial circumstances are different. It is important that you discuss this with your Spanish lawyer from the outset and make sure that the ownership structure that it is put in place and your future plans related to your Spanish property work well together and in the most tax efficient way. Your Spanish lawyer will need to obtain some personal information from your and/or your UK accountant/tax advisor so that they can work together.
- Consider a Spanish Will
Our Spanish lawyer will be able to assist you organising your Spanish Will. Spanish Wills can be executed in Spain or in the UK and once we know about your personal circumstances we will be able to advise you on the most suitable option for you. English Wills are also accepted in Spain however a Spanish Will would make the Spanish Estate administration more straight forward and this seems to be one of the most popular options however and again there is no one solution that fits all and we would need to assess your particular case and position.
- Check health insurance cover
One would assume that being with an EU country would be covered for medical assistance in the same way that they would be at home however remember to do your homework and check that you either have a private medicate insurance in place or the relevant EU health card before you travel to Spain. Also remember that travelling on holiday would not be the same as acquiring Spanish residency and that this may affect your medical cover.
- Learn some Spanish
Last but not least, why not consider learning some Spanish? It is never too late to learn some basic Spanish which no doubt will open new doors for you and allow you to interact with Spanish natives and make the most of your time whilst in Spain!
Contact our Spanish lawyer for an initial free consultation and to see how we can be of assistance on 07400 914 407 or 020 7152 6550 or by email: Susana.Lajusticia@keystonelaw.co.uk. Keystone Law, Audley House, 13 Palace Street, London SW1E 5HX.