Thinking about buying a property in Spain? Great choice!
It has been estimated that 75.6 million people visit Spain every year. This makes it the third most visited country in the world.
With breathtaking scenery and rich history, its no wonder Spain is among the most visited and the most sought-after places to live. If you are in the market to buy a home in this wonderful country, there are a few things you need to be aware of so that you make the right decisions.
Here are the major things you need to know about buying a house in Spain so that you can avoid any pitfalls.
1. Location is Everything
Make sure you purchase your property in the right location for your lifestyle. If you want to purchase a property in one of the more popular must-see destinations, make sure it is right for you.
You need to be practical about your decision to buy a home. Find out about the community and culture. Make sure that you can easily access stores and supermarkets when you need to buy food, shop for your necessities and get medical attention.
2. Not Planning for Fees
You need to make sure that you have all the necessary funds to acquire your property. If you have found the right home and are excited about the fact that you have enough money to make the sale price, you should find out all the fees that you will have to pay upfront and make preparation for it.
Here is a short list of the fees you can expect to pay.
- Lawyer fees
- Notary fees
- Property Register fees
- Transfer tax
- Stamp duty
- Value added tax (VAT)
There may be other fees you will have to pay, so make sure you are knowledgeable about this so that there are no surprises that can throw off your budget.
3. Don't Make Final Decisions In a Hurry
One of the most common pitfalls, especially if you are a foreigner is to fly in with limited time to properly transact your business. There is an old adage that "haste makes waste" and never is it truer than when buying a property in Spain.
Fly in when you have ample time. This will prevent you from overlooking details about the property you want to purchase or making a purchase that you will end up regretting.
Make sure that you have a couple of weeks, not days, available to conduct your business. This will prevent bad decisions.
4. Signing Unchecked Documents
While you may be in love with Spain, don't make the mistake of thinking you can do things differently than you would in your own country. This means that you should not neglect to do due diligence on any paperwork that you have to sign. Avoid signing private contracts that only you have read over.
Do not sign anything unless it has been checked by a lawyer. You will also need to make sure you investigate the legal status of the property and get inspections done by officials.
5. Not Preparing for Taxes
Prepare to pay your taxes once you buy a property. Find out the cost of property tax and income taxes.
There is one special property tax that you should make sure that you know everything about. This is the Spanish council tax.
This is a municipal property tax that must be paid each year to your local council. Failure to pay can lead to fines and additional interest rates.
There may also be other complementary taxes that you will need to pay, so make sure you are prepared for these.
6. Forgetting To Set Up Your Bank Account
In order to pay your utilities and the fees for your property that were mentioned earlier, you are going to need to have a bank account. If you obtained financing to pay for the property then you will need to set up your bank account so you can make automatic monthly payments.
For your convenience, it is best that you open up a bank account with a bank that is close to your home. Make sure you find out about the charges that you will incur if you deposit money, clear cheques, receive and send transfers.
Ask around because in Spain the fees can vary widely depending on the bank. There are some documents that you must have on hand in order to open your bank account in Spain.
Here is a list of the documents that are usually a necessity:
- Your passport
- Proof of your address
- Proof of your employment status
- Your foreign identification number
- Your foreign identification certificate
More often than not you will need to have some of these documents officially translated if they are in English or another language. You will probably also need to have your documents authenticated by getting an Apostille stamp. An apostille stamp is a certificate that is issued to verify the official who signed your documents.
7. Get Your Lose Ends Together
One of the most important things you need to do once you have bought your property is to tidy up the utilities. Get everything changed over or set up in your name as soon as you can to avoid delays.
Even if you do not plan to live on the property immediately, it is best to get these things done as quickly as possible.
Final Thoughts on Buying a House in Spain
The important thing to remember when buying a house in Spain is that you must seek help, get advice and ask the right questions.
Failure to get professional help may result in a delay in your transaction or may cause you to get involved with shady characters who don't deliver what they promise. Make sure you have a lawyer who is familiar with the ins and outs of Spanish law and can do due diligence to the all the paperwork involved.
Set your finances in order by opening up a bank account and make preparations to pay all your bills and taxes.
If you would like more information about buying a home in Spain, please visit our blog.