Quick Tips...
Spanish property is at a premium and especially in the Costa Azahar region between Valencia and Alicante. More people are discovering this relatively new tourist area where they can still find deserted beaches in the high season which is probably unique in Europe. More is being written about it in holiday magazines and it is especially popular with the British. Many of them consider Spain as their second home and some eventually move here to live as we did. This is not strange if you have a look at the Spanish and their warm hospitality. They make you feel at home in every way they can and if you respond in kind, you won't go far wrong.
The number of people who move to Spain permanently is growing each year. This area between Valencia and Alicante is a good one to invest in. Buying a property in Spain can be a daunting process if you don't know the local regulations or the language. Paraiso Homes knows all the procedures from choosing your property through to buying it.
Spain enjoys a good quality of life with general consumer goods and property being favourably priced compared to incomes. This reflects on its popularity for retirement homes. However property prices are rising sharply in line with domestic property prices so eventually there will be parity. Living near the coast is perhaps the ideal but you might find inland areas have much to offer for considerably less money and are still within easy reach of the coast.
Buying a Spanish property will normally be detailed in a private contract with a deposit of around 10% payable which is binding by law. It is possible to agree a contract where either party may change their minds at a financial cost. The private contract should contain details of the agreed deposit payment, purchase price and details for payment of the outstanding balance of the agreed buying price plus any additional extras and your intended completion.
A Notary will prepare the official contracts and make sure it complies with Spanish regulations. If there is common ownership a Community of Owners must be established through which community charges can be shared. If your property is contained in an apartment block then the law will relate to the Horizontal Division and this should be clarified, especially in new developments.
Any property sale or purchase in Spain should be registered in the Land Registry and its important to make sure any relevant taxes are paid before this is done.
Beware: It is common practice for the sale and purchase price to be understated by Spanish sellers, enabling them to reduce their tax liability and reducing your stamp duty fees. However, you could be liable for Capital Gains tax on additional profit once the true price is declared and non residents will normally be expected to deposit 5% of the sale proceeds with local tax offices until any agreements are reached, and could have liability by both seller and buyer if the profits exceed set limits around 12,000€.
Fees: You can expect to pay a total of around 10% of the purchase price for real estate in Spain. This could include Stamp duty, charged at 7% of the official selling price (4.5% for the Canaries), and 0.5% for contract documents Land Registry is charged against a rateable table held by local authorities. There will also be a tax on the increase of the land your property lies on since it was last sold and should be paid by the vendor. Notary fees will also be included in the total costs.
Property Tax: All your Spanish property taxes will be based on the official price registered, not on selling prices and you would expect to pay under 1% annually plus additional service taxes set by the local authority (similar to Council Tax). Wealth tax charges apply for residents after 105,000€ of net assets; if you don’t apply for residency you could be charged tax for all your net assets. The rate varies from fractions of a percent to over 2% depending on net assets.
Mortgages: Spanish lenders will allow you to borrow against Spanish property and can usually be arranged in most major currencies normally over terms of up to 15 years, with exception of 25 years at up to 80% of the buying price.
Our guide does not cover all the legal and full financial information for your property purchase but should enable you to get a basic idea of procedures and the financial implications.
Costa Blanca Property: Before you think of buying a property here, make sure you check the areas around together with friends or local property agents. Short intervals in the region are advisable to get a good look at life all year round, not just in the summer time. Convenient trips to Valencia or Alicante can be done at the weekend and this allows you see for yourself how people live in throughout the year.
Publications such as maps, or guidebooks which include maps of the area around your chosen area should be bought.
Property tips: Upon arriving at the airport you can use the rental car services which are offered there - taxis can cost more than hire cars! There are also good public transport links but you should research these before you set off.
Costa Blanca in winter can be quite different than in summer. More than one visit before buying for good is strongly advised. Stay at different places if your intentions are to buy so you can study the area. Be aware of sounds and noise produced during different periods of the day and night. Check it out personally.
It's a good idea to be informed about buses, trains, trams and other public transport, keeping in mind day and night traffic, much as you would back home. Take your time and don't rush
Choosing the right time to buy isn't relevant because so many properties are available all the time in Costa Blanca. Don't hurry into purchasing. Make sure you've made a good comparison with others. A good agent who inspires trust and confidence is important and will never rush you into anything.
Be mindful of what is to come. Remember that properties in this part of Spain might need heating or electricity. Some rural properties have neither water , telephones nor electricity so weigh up the extra expense involved. Will the property be easily accessible or is it a 6th floor with no lift available? Shopping bags might seem ok during a few days visit but would you want to do it permanently?
Talk to estate agents and property brokers about offers in Costa Blanca. The Internet is a fantastic way of researching available property and also for learning about what's involved - that why you're here now!
One last tip: Talk to your future neighbours and locals. Although it appears to be all uphill struggle, it can be done with relatively easily. If you can get a personal opinion from some of the people living in the area where you've chosen to buy, you'll feel better informed. People from all over Europe have settled in Spain so you won't be totally alone. Keep these hints in mind before deciding on a property but don't wait too long because prices are rising fast and you'll be missing out on an incredible experience in this part of Spain.
Paraiso Homes sell property in the Costa Blanca and because we speak fluent English, you'll have no difficulty understanding anything and everything with us...