The Importance of Good Research
Sounds obvious but you cannot do enough. These days you can find plenty of information and obtain advice without having to leave the comfort of your own home or office. Once you have done this we would strongly recommend that you take a trip to see the area. If you are looking for a holiday home, why not rent something similar to what you are considering buying. If it is a permanent move to Spain, spend as long as possible staying in the area you are considering.
 
Is it Right for You?
Get to know the area you are thinking of living in. You will meet plenty of people who will offer you their opinion, don’t give this too much consideration. It is neither right nor wrong; it is your experience and opinion that matters. It is better to spend a little now than regret spending a lot later.
 
Where should I Start?
Looking for a property is exciting but should almost be the last thing you do. Make sure you get your finances in order first. If you are a cash buyer obtain information on currency exchange, there is the potential to save thousands here.
 
If you require a mortgage, obtain details of this first. A bank or financial adviser should be able to give you a quotation of costs and an undertaking as to how much you can borrow. At the moment most banks in Spain will lend up to 70% of the purchase price or the valuation, whichever is the lowest? Remember to allow for additional costs on top of the purchase price. As a guide you should allow between 10% and 13% extra.
 
What else do I need to Know?
It is best to enlist a good solicitor before looking for a property. There are other matters to take in to account such as taxation planning and the writing of a Spanish will. Obtain good sound advice either in your home country or better still from a solicitor in Spain.
 
Set Your Budget
Once you know how much you feel comfortable with only view property within in your budget. If you require a mortgage, make sure you have a written offer from the bank and have taken into account all the costs associated with the mortgage.

Finding your Dream Property
Now you have done your research and have a clear understanding of your comfortable budget, you should select a shortlist of potential property to view. If you have done your research properly this should mean that you will have 5 or 6 properties that match your requirements. Everyone is different and you might prefer to see more than this but it can get confusing if view too many properties. It could also suggest that you have not done enough research previously.

Found your Dream Property
Once you have found the right property, negotiate the price and completion date. We would advise you to have your solicitor check all the legalities before you pay a deposit and sign a contract. It is very important that you fully understand the consequences of the contract you are being asked to sign. As well your solicitor should explain what happens if there are any delays in the completion and what options and responsibilities you have should this occur.
 
What else do I Require?
Now you have decided to purchase a property you will need to arrange the following; open a Spanish bank account. Obtain an NIE Number, this is known as (Numero de indentificacion Extranjera). It is possible for you to do this yourself but for a small fee it is probably easier and better to use one of many of the professional services available to do it for you. If you are already resident here then you will already have a Spanish bank account and NIE Number. You should also have all the documentation necessary to purchase a property but check with your solicitor just in case.

The Solicitor
Your solicitor will take care of all the necessary steps required and keep you informed of progress. They will notify you in good time when you will need to attend the Notary office for completion. You can also expect the solicitor to act on your behalf in arranging connections of utilities (water, electric, etc.) It is also possible for you to appoint your solicitor with power of attorney, so that he can act on your behalf when you are not able to be in Spain.

Arranging Financial Matters
Remember to allow time for funds to be cleared prior to completion. We would suggest you use a currency exchange company to achieve the best possible rate of exchange and to avoid additional fees. You should allow 10 – 14 working days for the money to be available either in your own bank account on in your solicitor’s client account. This way a bankers draft can be organized to cover the outstanding balance. If you require a mortgage, your solicitor will arrange for a representative from the bank to be present at the Notary.

Other Fees and Costs
On completion of the property you will need to allow 10% on top of the purchase price, this covers 7% transfer tax or IVA if a new property. The remaining 3% is to cover notary fees, stamp duty, registry fees and legal fees. Add a further 3% if using a Spanish mortgage. All figures are for guidance only; your solicitor will provide you with the exact amounts.

Ongoing Costs
As a property owner in Spain you will need to pay certain taxes each year. Council tax (IBI) is considerably less than in the UK. A typical 2 bedroom apartment would cost in the region of 200€ per year, this depends on the area you live. Larger properties such as independent villas would be more.

You will also need to pay Notional income tax if the property is not your main residence; again this is a relatively small amount. With notional income tax there are different calculations depending on if you are resident or not in Spain.

As in the UK, you have other ongoing costs associated with property ownership. In Spain the main costs are normally far less than that in the UK. Collection of rubbish (Basura) is normally around 120€ per year. If you live on urbanization you will need to pay community fees. The cost depends broadly on the services provided and the number of properties.

Taxation
It is also worth mentioning Wealth tax, although from 2008 this tax is expected to be abolished due to new legislation currently being approved. On selling your property you may have a responsibility for Capital Gains tax, this is currently at the rate of 18% for Residents and Non Residents. With regards to both these taxes we would suggest you check this with your solicitor or gestoria.
This may all sound complicated, in reality it is very simple as long as you get everything in the right order. Remember, research first, visit area, arrange finances, get legal advice, find for your dream property, relax and enjoy your new home.
 

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