Buying a property in Spain.
Buying a property in Spain is easy. There are many estate agents and buying and selling is safely regulated through Spanish law. When buying a property the most common way is to contact a local estate agent and then specify as clearly as possible what you are looking for. The real estate company will then usually show you different properties that match your criteria.

When you have found the property you want to buy, you will have to pay a deposit. This is to make sure that the property is not sold to anybody else. In Spain, as in England, several estate agents can be marketing the same properties through multi listing.

During the next couple of weeks the contracts are drawn up, making sure that all the relevant details are in place. When signing the contract one usually has to pay between 10-35% of the purchase price, depending on whether it is a new or resale property. We would always recommend using a lawyer to draw up the contract. The contract should contain the purchase price, the terms of payment and date for taking over the property. The lawyer will also make sure there is no outstanding mortgage on the property.

Resale property.
There are a huge variety of different properties on Costa del Sol. Here at the east side of Malaga it is possible to find something to suit all pockets. From small apartments to fincas (farms), some of which need a little refurbishing or restoration. Then of course there are the more expensive properties on the beachfront and luxury villas. The properties are usually more expensive the closer you get to the sea and in the more well known tourist areas. It is still possible to get a really good bargain in this area east of Malaga, and as a real estate company we will be able to advise you as to where best to invest, taking into account both price and quality of respective properties.

When buying a resale property following costs are involved:

Transfer tax (ITP) which today is about 8%

Notary charges according to a fix scale depending on the price of the property. Usually you should calculate between 0,5% and 1% of the buying price.

Legal fees to a lawyer will be approximately 1% + IVA

In Spain it is common practice to pay a part of the purchase price directly to the seller and underdeclare the price on the Transfer Deed (Escritura). In some cases the seller may ask you to declare only 40% of the purchase price. The most common is to declare 60-70%. When declaring less on the Transfer Deed than the purchase price, you will of course pay less tax (ITP). A lawyer will usually always advise you to declare as much of the purchase price as possible. You will have to pay 18% capital gain tax if you sell your property within 2 years.

New properties.
Today a lot of new developments are being built in Spain. If you have the time, then purchasing a new property at an early stage is generally a good investment. Very often savings of up to 30% are possible, depending on how early in the process you sign the contract. Usually it takes from 6-18 months from signing the contract to moving in. Purchasing a new property also offers you the opportunity to influence the finish. Tiles and colour schemes for example. In some cases, even pulling down or putting up a wall will not affect the price very much.

In Spain all new houses have a 10 years guarantee. The developer must take out a policy that covers the house. Even if the developer goes bankrupt the insurance continues.

When purchasing a new property the following costs are involved:

Tax (IVA) which today is 10 % on new properties

Stamp Duty 1%

Notary charges according to a fix scale depending on the price of the property. Usually you can calculate 0,5-1% of the buying price

Legal fees to a lawyer approximately 1% + IVA

Building your own property can save you a lot of money, and you will get what you want. The quality of construction has improved dramatically of late. Problems with bad workmanship are very rare. The biggest problem building your own house is to get the craftsmen. Because of the larger developments, most of them are engaged already. This can cause a chain reaction of small delays in the building process. You should not be surprised if the completion of the house takes a little longer than first anticipated.

As a real estate company that knows the area, we can help and make sure that the plot/land has legal access to water, electricity and a building permit. Naturally we can also give advice or tips about architects and builders/building companies.

When purchasing a plot/land following costs are involved:

Tax (IVA) which today is 21% on land.

Land registry, approximately 40% of the Notary charges

Notary charges according to a fix scale depending on he price of the property. Usually you can calculate 0,5-1% of the buying price

Legal fees to a lawyer approximately 1% + IVA