This guide is designed to walk you through the entire property purchasing process in Spain, ensuring a safe and smooth transaction while adhering to all necessary procedures.

Step 1: Finding the Property

After selecting the property that best meets your needs, the selling agent will provide a reservation document outlining the terms of the agreement. Signing this document is accompanied by a deposit, the amount of which will vary depending on the property.

This deposit serves two purposes:

• It officially removes the property from the market.
• It acts as a declaration of intent to purchase.

At this stage, it is highly recommended that you appoint an independent law firm to represent you. An experienced lawyer will make the process more manageable and less stressful.

Step 2: Appointing a Lawyer

Your lawyer will handle the legal aspects of the purchase process, ensuring all steps comply with Spanish law. Their duties typically include:

• Ownership Verification: Confirming that the seller is the rightful owner of the property and legally entitled to sell it.
• Property Registration: Ensuring the property is correctly registered in the Land Registry.
• Debt and Charge Checks: Verifying the property is free from encumbrances, such as mortgages or liens.
• Building Permits: Confirming the property has the necessary permits issued by the local town hall.
• Compliance Checks: Ensuring adherence to planning and building regulations.
• Contract Review: Reviewing and, if necessary, drafting private contracts (e.g., reservation or purchase agreements) and public documents (e.g., public deeds).
• Payment of Taxes and Fees: Managing the payment of associated taxes and expenses.
• Land Registry Updates: Registering the public deed with the corresponding Land Registry.
• Utility Transfers: Updating ownership details for utility bills, taxes, and other running costs. They can also set up direct debit payments from your Spanish bank account.

Once these legal checks are complete, the purchase progresses to one of the following steps:

1. Exchange of Contracts (if applicable) – Proceed to Step 3.
2. Completion – Skip to Step 4.

Step 3: Exchange of Contracts

This legally binding stage commits both parties to the transaction:

• The buyer is obligated to purchase the property.
• The seller is obligated to sell the property.

At this point, a payment—typically 20% of the agreed purchase price—is made. The necessity of this step depends on the property and the specific terms of the agreement.

Step 4: Completion – Get Your Keys!

On the day of completion, your lawyer will arrange for the final payment to be made, and the property deeds will be signed. Completion can take place in person at the notary or remotely via Power of Attorney if you cannot be in Spain.

Once completed, you can move into your new home!

Purchasing Costs

The total costs of purchasing a property in Spain typically range from 10-13% of the purchase price. These include taxes, fees, and legal expenses, as outlined below:

Breakdown of Fees & Taxes

• Government Transfer Tax (IVA): 10%
• Legal Fees: Approximately 1% (varies by law firm and services).
• Notary & Registry Fees: 1%
• Mortgage Fees (if applicable): 1-2% (depends on mortgage type).

Property Running Costs

In addition to purchase costs, you should budget for ongoing property expenses. These typically amount to 2-4% of the property's value annually and include:

• IBI: Local annual property tax.
• Basura: Waste disposal tax.
• Comunidad: Community fees (for apartments or gated communities).
• Maintenance: Garden and pool upkeep for independent villas.
• Insurance: Building insurance.
• Utility Bills: Electricity, gas, water, internet, etc.

By following this guide, you can ensure a safe and efficient property purchase in Spain while minimizing risks and unexpected challenges.