Buyers Guide Part One – Useful Early Phase Pointers to Successfully Buying Spanish Property
Martin Hayes Abogado & Solicitor of Swan Partners gives some useful tips on how best to plan and prepare for a Spanish Property Purchase.
Know before you go
As with any important project, embarking on the right foot is certainly half the battle. This is ever more important when the project in question is purchasing an overseas property.
Putting the time in to properly research the environment where you wish to purchase the property will mean that you can focus your efforts on finding the property that is right for you rather than finding out later, after you have invested your time, effort, and money, that you have overlooked something that fundamentally unsettles your intended plan of action.
Pick your team carefully
Take the time to make sure that the team of professionals that you ultimately pick to assist you with your Spanish property purchase is right for you. Simply put, there is no substitute for ensuring that the people that you entrust have a solid reputation, effective staff and appropriate qualifications.
Do not be afraid to check credentials. Agree terms of engagement in advance and have them committed to writing.
Check that you will have an open, friendly and supportive communication with your agent and advisors. This will ultimately allow you to make fully informed decisions throughout the purchase.
Get your preparatory work right
Work with your agent and your lawyer from the early stages of your property search to get your preparatory work right. Fully explore full your expectations in terms of whether your budget is reasonable with the agent and explore with your lawyer the legal issues that can arise with the type of property that you are interested in. Taking this approach allows you to get the most from your agent by keeping your property search correctly focused.
Get a clear understanding of the financial aspects of the transaction
Gain a full understanding of how your budget can be best applied. Explore whether or not you wish to finance your purchase with a Spanish mortgage. Check whether you should engage the services of a specialist Spanish mortgage broker to gain a full understanding of all the possible options open to you. Explore with your lawyer whether or not there are any issues with the property that you have in mind that may adversely affect the availability of mortgage finance.
Have a clear understanding from your lawyer as to what the closing costs are likely to be including transfer tax, notary fees, property registry fees and legal fees.
If you plan to get a mortgage, engage with your bank and or mortgage broker from an early stage in the property search to gain a full understanding of the associated costs. Be sure that you have enough private funds to complete the transaction.
Pick the bank that best meets your needs. Try to deal with a bank that can provide services in your language. Gain a full understanding of the bank fees and charges. For example is commission payable when transferring or receiving funds?
Given that we are living in a time when currency exchange rates can fluctuate considerably, check whether it is appropriate to use a currency company to assist you with the transaction? Explore your options with your agent and lawyer.
Plan for lifestyle issues
If your purchase is to be made within the context of a planned relocation to Spain, make sure you have all the lifestyle issues property planned for such as, for example, health care cover, pension arrangements, income tax planning etc. Have a good discussion with your lawyer so that possible issues can be teased out and dealt with comprehensively.
If you are planning to relocate to Spain from outside the European Union, explore with your lawyer what type of a visa or residency permit is best suited to your circumstances. Make sure that the lawyer that you are dealing with has a specialist knowledge of this area or works closely with an experienced Spanish Immigration lawyer.
Get a Structural Survey
Once you have found a property that you wish to purchase it is highly recommended that a full structural survey is carried out on the property. The cost of such a survey pales in comparison with dealing with structural issues that may arise post purchase. Information gained in the survey may also serve you well in terms of the negotiating the purchase price of the property.
Do As You Would Do At Home
One notable feature in litigation cases that the writer has dealt with concerning property transactions in Spain is that risks were taken that would not have even been remotely considered had the person involved been purchasing a property in his or her home country.
Never enter into a contract or part with funds without getting legal advice and having the document that you are signing fully explained to you. Would you sign a document in a language that you do not understand without a clear understanding of its legal ramifications at home? There is no reason why you should start doing so in Spain…
Before putting pen to paper check with your lawyer
Remember that the maxim of buyer beware holds true and it is largely the purchaser’s responsibility to a make proper and full enquiry into the property that he or she is purchasing.
Before entering into a legal agreement make sure that your lawyer has carried out the requisite checks appropriate to the nature of the agreement being proposed. Do not be afraid to quiz your lawyer and agent on the process. Have them commit to writing in relation to key issues.
Seek confirmation on the urban planning status of the property and ensure that same is properly provided for in the proposed legal agreement.
Get confirmation that your lawyer has checked that the person selling the property has proper and unfettered title to the property.
Consider the time factors involved in the proposed transaction against your own circumstances; do you need time to release funds from an investment fund? Will you need to apply for mortgage finance? Are there currency issues that you need to consider?
Contracts and Concluding the Transaction
Once you have taken the above steps, you should be in a solid position to embark on the next phase of the transaction namely entering in the legal process of purchasing the property.
In the next installment of his buyer’s guide, Martin Hayes will outline the key points of the contractual procedure in purchasing a Spanish Property.
If you would like to contact Martin in relation to any points raised above or indeed enquire about his services please contact him directly using the following contact details:
T:+34.960.912.325 M: +34 666.917.707 E :firstname.lastname@example.org W: www.martinhayes.es
Calle Colón, Nº 20, PTA 12
46004 Valencia (España)
© Martin James Hayes 2015