ABOUT OUR WORK
LEGAL AND REAL ESTATE ADVISOR IN BARCELONA
Buying property in Spain can be problematical if you do not use Spanish lawyers and even then there are sometimes issues especially over the legal size of the property. Many properties are either an 'illegal build' or an ‘over sized build’ and there are substantial fines attached for the new owners in addition to the possibility of having the property, or part of the property, demolished by the authorities.
There are numerous horror stories regarding purchasing property in Spain but there are a few golden rules to follow:
1. Appoint a truly bi-lingual Spanish law firm
2. Any deposits paid should go into an escrow or bonded client's account and never be paid into an estate agent's current account
3. Beware of signing powers of attorney, ensure that you really trust the professional you are handing this over to
4. Ensure the escritura has the correct measurements of the house on it and that it is not just an escritura for land or for a smaller building than is actually there
5. Estate agents are now required to have the following documents for the property before marketing it: escritura publica (title deeds) and nota simple (short form of deeds available from land registry offices); paid up receipts for IBI (annual property tax); Catastral certificate with the exact boundaries and size of the property; paid up receipts for community fees; paid up receipts for all utility bills
6. Ensure that, as the buyer, you are not paying todos los gastos (all the legal costs); the seller should be paying at least the notary’ fees and the plus valia tax (capital gains tax on the property on the profit the seller has made since his/her purchase)
7. Under-declaration of the true sale price of a property used to be common practice but now there are heavy fines in place for the buyer and seller if you decide to take this risk. Furthermore, when you come to re-sell the property you will pay substantially more plus valia if you under-declared
8. When you come to signing the escritura de compraventa (deeds of sale) at the notary bear in mind that the notary is only responsible for ensuring that the contracts are signed and that monies and taxes are paid. The notary is not responsible for the accuracy of the contracts so you cannot blame the notary for you buying a property that is an illegal or partially illegal build
9. If buying off-plan ensure that all stage payments go into a bonded or escrow account.
There are numerous other points to take into account but your Spanish lawyer should deal with them e.g. if you are buying from a non-resident 5% of the purchase price will be paid over to the hacienda (town hall) as a guarantee against the non-resident's tax obligations.