Whether you are looking for a buy-to-let investment, a holiday apartment in the sun, or your dream family villa - buying a property is a big commitment and selecting the right one to meet your needs can sometimes feel overwhelming.
In addition to the pressure of locating your ideal home, dealing with a legal procedure in a foreign country is a daunting prospect. Choosing the right professionals to help you, having a basic understanding of the process, and what fees to expect, are key factors in making it as stress-free as possible.
Buying a property in Spain
Buying property in Spain is quite clear-cut. However, it is always handy to know who the various parties are; what are the costs-for a resale or a new build; and the typical process.
Real estate agent (el agente inmobiliario, Spanish translation)
It is best to find yourself a well-established, and reputable estate agent, one that understands the buying process here in Andalucia, and is experienced in the Costa del Sol property market. Getting the right property specialist will save you time, money, and stress in the long run.
A good agent will be well-knowledgeable about the area you are considering. They will take the time to listen to your requirements and communicate effectively with you.
It is worth thinking about some specifics before starting your search, if you can give your chosen estate agent some parameters to work from, they will be better able to tailor their search for a property, so it meets your needs.
You will want to think about location, where do you want to live or stay? Marbella, the Golden Mile, Benahavis, Estepona. What type of residence are you looking for? A town house, villa, or apartment. What size do you need? What are you purchasing the property for? An investment, a rental opportunity, a holiday retreat, or a family home.
The right real estate will look at your requirements, be able to advise you on the best options for you, and be by your side throughout the buying process, from looking at properties, negotiating a deal, and making the actual purchase.
You are not legally required to have a lawyer to purchase a property in Spain, nevertheless it is advisable, and some mortgage lenders or banks insist upon it. Your lawyer will confirm that all the seller’s paperwork is in order. They will check there are no liens or charges against the property, and that all utility bills, community charges and property rates (IBI) are up to date. Any new build property will also require a habitation licence.
Any lawyer practising in Spain should be registered with the local bar association (Colegio de Abogados). You can verify their registration number with the bar association.
Here in Spain the final contract of sale and/or the title deed is signed in front of a notary. They will then notify the registry office that a sale has taken place. It is the buyer’s responsibility to register the property at the land registry, and the notary will usually do this, either as part of their service or for an additional fee.
Property buyer/purchaser/ vendee – (comprador)
These are different names to describe the person, people, or company buying the property.
Seller/vendor/supplier – (vendedor)
These are all various terms used to denote the person or party selling the property.
Costa del Sol property – the costs of buying in Andalucia
It is the buyer’s responsibility to ensure all fees and taxes are paid. This can be done by the buyer directly, the real estate agent working on your behalf, or your lawyer.
Depending on whether your new property is a resale (previously owned by someone else) or a new build bought from a developer or bank, you should expect to pay somewhere between 8.5% - 13% in costs on top of the purchase price. These include the following -
As a resale buyer in Marbella, and throughout Andalucia, you will pay 7% transfer tax (I.T.P.) on any residential and commercial property, or plot. This includes villa’s, apartment’s, land, or business and industrial spaces. You are exempt from transfer tax if reselling properties is your registered business.
If you are buying a new build, you do not pay transfer tax, but you will be liable for 10% IVA (VAT) and 1.2% stamp duty tax.
Expect your lawyer to charge around 1% of the property price (plus 21% IVA).
Depending on the intricacy of, and the number of pages included within, the contract, the notary fees and property registry cost will come to about €3000 or 1% depending on the property price. This can also be significantly higher if the contract of sale and the title deed are lengthy or complex.
Spanish property – the purchasing process
Once you have found the property most suitable for your needs, you will need to make an offer. Your real estate agent should manage all the negotiations on your behalf and once a price has been agreed by both parties, it is time to reserve the property. This means it will be taken off the market whilst your lawyer does the due diligence and agrees the terms and conditions of the sale.
You will sign a reservation document or holding agreement and make a deposit, typically around €6,000, which shows your genuine intent to purchase the property. This deposit amount is refundable if the vendor fails to meet the terms of the holding agreement or changes their mind about the offer.
The lawyers for both sides will check that all the legal aspects of the property are in order and then draw up a preliminary private purchase contract (contrato privado de compravento), sometimes called an option agreement. This is a legally binding document signed by both parties agreeing all the details of the property, the price, payment terms and date for completion.
At this point the buyer pays the seller a deposit, usually around 10% of the total purchase price. This deposit is retained by the seller if the sale does not complete. Any buyers requiring a mortgage should ensure that this is in place ahead of this stage.
For new builds, a payment plan is decided over the agreed period of construction up to completion.
The sale will be complete once the buyer’s ownership has been registered and the purchase price has been paid in full. To do this the contract of sale (escritura de compravento) and/or the title deed (Escritura Publica) is signed in front of a notary.
In conjunction with signing the full sale price, taxes and other costs are paid, and the buyer receives the keys to their new property.
Property Sales in Marbella
If you are looking for a holiday retreat, a permanent residence, or you want an investment property -
Marbella’s mix of the luxurious gated developments, picturesque mountains and beaches, and the private tranquil urbanisations make it the place to buy on the Costa del Sol.
We are seeing a huge demand for all categories of real estate - apartments, townhouses, detached villas - and we are actively looking for all types of properties for our buyers. It is a vendor’s market and if you are looking to sell, now is the time.
We understand that choosing a new home is a big step, and for those of you buying or selling a property in a foreign country, it can be very stressful. Our team of real estate experts provide a full ‘hands on’ service. We work in partnership with you (our client), your lawyer and any other professional advisers or consultants.
Dolan Property is here to help you through the whole process, every step of the way. We are based in the heart of Marbella’s Golden Mile and specialise in high quality, desirable properties in prime residential locations; Nagüeles, Sierra Blanca, Cascada de Camoján, East and West Marbella, Istan Road, Nueva Andalucia, and the new Golden Mile in Estepona.
Dolan Property specialists are committed to the highest levels of business and ethical standards, and we are proud members of the Leading Property Agents of Spain (LPA).
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