If you want to buy a house in Spain, there are some rules you need to follow. Below, you’ll find a list of things to consider when making a purchase, whether with or without a mortgage.
Keep reading to learn more about the rules for buying a house in Spain!
What are the rules for foreigners citizens to buy a house in Spain?
Buying a house in Spain can be an exciting adventure, but it’s important to be well-informed about the rules and procedures. Here are some key steps to keep in mind:
Financing
Review your financial situation and discuss mortgage options with banks in Spain. It’s possible to finance between 70% and 80% of the purchase price.
NIE (Foreigner Identification Number)
Apply for a Número de Identificación de Extranjero (NIE). This identification number is required for legal and financial transactions in Spain.
Real estate agent (and lawyer)
It’s advisable to hire a local real estate agent familiar with the Spanish market, and possibly a lawyer to assist with the legal aspects of the purchase.
Due diligence
Conduct research to check for any debts on the property, review ownership documents, and ensure there are no legal disputes.
Deposit contract
Once you find a suitable property, you can sign a deposit contract (Contrato de Arras). At this stage, a deposit is typically paid (often 10% of the purchase price).
Notary
For the final purchase, you must visit a notary. The notary drafts the purchase deed (Escritura de Compra) and registers the transaction.
Registration
After signing the deed, the property must be registered at the local Land Registry (Registro de la Propiedad).
Taxes and costs
Be aware of additional costs such as transfer tax (ITP or VAT), notary fees, and registration fees. The transfer tax varies by region but generally ranges between 6% and 10%.
Insurance
Consider getting home insurance for your new property to protect it against potential damages.
Municipal regulations
Check local rules and regulations for property owners, such as municipal taxes and maintenance fees.
It’s always recommended to do thorough research and seek professional advice before purchasing a property in Spain.
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What should you consider when buying a house in Spain?
When buying a house in Spain, there are several key points to keep in mind:
Location
Thoroughly research the area. Check for nearby amenities, public transport, and accessibility to schools and shops.
Legal documentation
Ensure all legal documents are in order. This includes ownership titles, permits, and any mortgage details. Consult a local lawyer for assistance.
Additional costs
Don’t forget to account for extra costs such as transfer taxes, notary fees, and registration fees, which can amount to 10-15% of the purchase price.
Property condition
Have the property inspected to avoid hidden defects. This can save you unexpected long-term expenses.
Community fees
If you’re buying an apartment or a house within a complex, be aware of community fees for the maintenance of shared areas and facilities.
Regulations
Look into specific local or municipal regulations that may apply to foreign property owners and any restrictions when purchasing real estate.
By keeping these points in mind, you’ll increase your chances of making a successful purchase in Spain.
Buying a House in Spain with or without a Mortgage?
For foreigners, obtaining a mortgage in Spain can pose some challenges, but it’s certainly possible. Banks in Spain offer mortgages to non-residents, but the terms are often stricter than for Spanish residents. Foreign buyers are typically required to make a down payment of 30% to 40% of the purchase price. Additionally, it’s important to open a Spanish bank account and potentially apply for a Foreigner Identification Number (NIE). It may also be helpful to hire a local real estate agent or legal advisor to simplify the process and ensure compliance with all legal requirements. Finally, comparing different mortgage offers is recommended to find the best terms.
Buying a house in Spain without a mortgage offers several advantages. First, you save on interest and mortgage costs, significantly reducing your monthly financial burden. This leaves more room in your budget for other expenses, such as travel, renovations, or property maintenance.
Additionally, you have full ownership and flexibility: you’re not tied to a bank and can make sale decisions on your own terms. It also simplifies the purchasing process since you won’t need to go through lengthy approval procedures. Lastly, buying a house without a mortgage can provide stronger negotiating power with sellers, helping you secure a better price.
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