Buying Property in Spain

The purchase procedure will vary slightly depending on whether you purchase a new build property or a resale property.

When you have decided on a property to purchase the first procedure is to pay a deposit and sign a reservation contract. The deposit is normally 3,000 euros for new properties and 10% for resale properties. The contract will normally set out the remainder of the purchase, i.e. signing of the contrato de compraventa (purchase contract) and the completion.

Between the signing of the reservation contract and the contrato de compraventa your solicitor will carry out various checks on the title of the property. On the signing of the contrato de compraventa, which is a legally binding document, there will normally be another stage payment to make. The amount of this payment will vary depending on the developer and what has been agreed between the parties.

If you have purchased a new build property there will normally be other stage payments in the period between the signature of the contrato de compraventa and completion of the property. Again, these will vary between developers.

On completion, you will need to sign the Escritura before a Notary. The remainder of the outstanding balance will also be paid either by yourself or by a mortgage company. The solicitor can arrange for a Power of Attorney if you are not able to attend. Once the Escritura has been signed it will then be registered at the Title Registry Office.

You must be made aware that there are various taxes and costs that must be paid when purchasing a property in Spain.

Legal fees normally amount to between 1-2% of the purchase price of the property. Within this price the solicitor will carry out all the necessary registry searches, examine the purchase agreement and assist with completion.

There is a transfer tax to be paid of 7% of the declared purchase price. This is paid when the Escritura is registered at the Title Registry Office.

A stamp duty tax of 1% of the purchase price is payable when purchasing a new build property only.

Notary fees and land registry fees will vary depending on the property and the area. A general guideline for additional costs is approximately 10% of the purchase price. However, this will be higher if you are taking a mortgage for the purchase of the property.