Buying a house in Spain opens up many opportunities, whether you would like to move to the country, buy a property as an investment to rent out, or use the real estate to obtain nationality. However, the purchasing process can seem daunting.
Here is our Step by Step guide to buying a property in Spain.
Any foreigner can buy a house in Spain. The first (and most important) thing you will need is an NIE number, the identification number assigned to foreigners in Spain to carry out any type of legal procedure. Second, it’s essential to open a bank account in Spain since all taxes and expenses associated with the sale, must be paid through it. Once you have found your property, the purchasing process usually takes another 2-3 months, although it can take longer if you decide to apply for a mortgage.
The process of buying a house in Spain involves three essential stages.
1. The procedures before the sale
Once the seller has given you a copy of the Notarial Deed of the property that contains the information relating to the Property Registry (for example, it specifies who is the owner of the property), Carpe Mundi can go to the registry and request a simple note, a document confirming the property is free of debts and charges (such as mortgages).
2. Reservation Contract
The reservation contract corresponds to the moment the buyer deposits 1 to 5% of the property price, depending on what is agreed.
3. Purchase and sale contract with Arras clause
In most cases, when buying and selling a property in Spain, a sales contract is signed with a clause called Penitential Deposits. Typically, the buyer provides an initial payment of 10% of the total purchase price. Once paid, the seller is obligated to sell the property to you. If they don’t, they will have to refund you double the amount you paid (20% of the total price). However, if you, as a buyer, do not complete the purchase, you will lose that 10%.
4. Mortgage search
It is advisable, even before you start looking for properties, to study the buyer’s solvency so that, once you have chosen the property you want to buy, there are no surprises because you are unable to get the finance required for the property. The granting of finance is linked to the appraisal of the house.
5. The signing of the Public Deed before a Notary.
The purchase and sale of properties are formalised with the signature of a Notary. This appointment brings together the buyer and the seller. The Carpe Mundi Inmobiliaria professional will be with you throughout the process. The mortgage will also be signed (if required) at this time. This is when the transfer of the property is made and the keys will be handed over to the buyer.
6. Property Registry Registration
Carpe Mundi Inmobiliaria must register the property with the Property Register to identify the new owner and then forms referring to the payment of property transfer taxes must be completed. The period to make said payment is 30 days from the public deed. Finally the transfer of ownership for public services must be made. For example – gas, water and electricity. Be thorough in your planning to avoid any setbacks along the way.
