- OlgaFor the last 20 years, Olga has practised law in the Madrid region. She specialises in real estate transactions, contract law, immigration and civil law (family law, inheritances) including administrative processes. Olga speaks almost perfect English, having spent several years in the UK.
An attractive property investment in Spain – often as a result of location and architectural style – is to purchase an old building. As a result of all the problems that the buyer could face the property may well have a very low price to catch the attention of foreign investors, the price can be even better if the building has a joint ownership as a result of an inheritance. I am not saying this will not be a bargain, but as it will be your own responsibility to be informed and to do your numbers to see if the investment is right for you, it is strongly advised to obtain the advice of relevant professionals to ensure your eyes are open when you take on such a challenge.
It is still very frequent that one becomes aware of the property through a Real Estate Agency. In some areas of Spain they will charge you around 3% of the purchase price and will only provide you with generalised information, since their job is to sell property, not to look after your interests.
Many properties from the beginning of the 20th century do not follow the current legal system. For example, some of them do not even comply with the urban development plan and once you purchase the property you could receive claims from the local authority to make you demolish part of the building to adjust to that plan.
Other properties haven’t passed the technical building inspection (ITE) and there could be fines for that. Be aware that as well as looking for an architect to solve this problem, (which will most likely be the highest expense to get all the necessary work done) you could face any fines that were not paid by the vendors.
It may also be the case that the building has not been divided into any separate plots for the purposes of the horizontal property laws – or often it has only been done half way through, such that there´s been a division at the Land Registry but not in the Catastro (another public entity involved). So this may be a further process that may need to be carried-out after the purchase of a building or you will not be able to sell any individual apartments independently. Most of them don’t have a community of owners constituted, which you will need in the future, especially if you are not living in Spain.
Once you sign the pre-agreement contract with the sellers you must have things clear or otherwise you will lose the money that you have left to reserve the property which, if doing so through an estate agency will be quite a significant amount. Be careful to negotiate a date by which completion should take place that you will be able to stick to.
In order to make any purchase you will need to have an NIE in Spain which will be your tax identifier number and also consider whether to buy as an individual person or through a company. We suggest that with the current law, depending on the circumstances, it could be more beneficial to buy as an individual especially if you are planning to rent out the properties as you could have interesting tax deductions paying a personal income tax rate of 19.5% of your net incomes. Be quick to obtain a mortgage, check in all Spanish banks to see who gives you the best one, bear in mind you will have to pay for the property valuation as well as for the costs of the mortgage itself. You will also have the cost of transferring your own money to Spain and we strongly advise you to use a reliable currency exchange company that could help you to save money.
When signing your sales deeds you will have to check the valuation that the regional authority has applied tor the building. This might be higher than the actual price that you are paying and could lead you to future claims from the taxman . All this could be sorted out if you introduce an additional clause at the notary specifying that the price you bought was lower due to the poor state that your building had and keeping all the architects invoices as well as all the rest of the expenses that you have had to face to be able to defend yourself from this type of fiscal claim.
Once the purchase has been completed and the deeds have been signed at the Notary, you will have to pay the notary fee and pay the transfer tax or ITP (Impuesto de Transmisiones Patrimoniales) which will depend on the region you are buying in – here in Madrid it is 6%. Your deed has to be registered at the Land Registry which has its own inscription fee too.
Owning the property involves paying a local property ownership tax called IBI which you should know in advance if it has been annually paid or otherwise you will have to assume the debt. The shared expenses of the building will also have to be paid by you and especially if you are planning to rent out the apartments we suggest you have an insurance company covering any problems that your apartments could have in the future.
When contemplating a property purchase in Spain it is always a good idea to arrange for independent legal advice, however with old buildings it is absolutely mandatory given the number of potential pitfalls. However, when all is completed satisfactorily, these buildings can provide the greatest enjoyment for foreign investors in Spain.
Below is a list of recent reviews received from our clients, obtained via the Wufoo client survey platform:
- David Stack, Lliria, SpainThursday, June 21, 2018Francisca was extremely helpful. She made the whole process easy to understand. I would definitely recommend her service to friends.
- Susanna Buckley, United KingdomWednesday, June 20, 2018Lidia is very approachable and friendly and I never felt that anything was a problem.
She was also very sympathetic to my situation (my mother had passed away) and supportive. As soon as she was c...ontracted, she acted quickly to sort things out so that I could return home to the UK as soon as possible.
She always tried her best to answer any questions very quickly and promptly and matters proceeded without too much worry on my part.
- Wendy Dickson, MarbellaTuesday, June 19, 2018It was all done very quick. Very good value for money. How easy it all was to communicate via email.
- Peter & Anita Bradshaw, Leeds, EnglandMonday, June 18, 2018We could not be more happy with the service we received from Jaime.
He responded immediately to our enquiry and it was clear from the outset that he fully understood our position. It was vital tha...t Jaime acted quickly in this matter and he did so in a highly professional and competent manner, providing us with clear and concise updates throughout.
We found Jaime to be very polite and approachable and we believe his fees to be very reasonable. We would genuinely not hesitate to recommend his services.
Before contacting Jaime, our previous experiences of Spanish Lawyers had been appalling - in fact we needed Jaime's help to resolve issues which previous Lawyers had created. Our only regret is not finding Jaime sooner!
Thanks so much for all your help Jaime.
- Jan Neate, NerjaWednesday, May 30, 2018Very satisfied with the service provided by Beatriz. She extremely helpful and spoke more or less fluent English. We would definitely recommend her to friends.
- Serena Bhatia, LondonWednesday, May 30, 2018Anna has been nothing but helpful in providing information, sound advice and genuine care, My fiancé and I adore her! She is timely, professional and extremely knowledgeable about world wide law.
- Ronald Peter Downs, SpainTuesday, May 29, 2018A lady staff member took us under her wing and managed to sort out my residency. Overall no complaints.
- Tracey and Mike Iliffe Bradley, Colchester, United KingdomTuesday, May 29, 2018From our very first contact through to the end of our purchase, Rosa surpassed all expectations.
She was helpful, efficient, always quick to return our communications and a pleasure to deal with. ...We have already recommended her services to a friend.
- Cheryl, SevilleMonday, May 28, 2018Miguel was helpful and kind. We will use his service in the future.
- Ken & Margaret, TorreviejaThursday, May 24, 2018Pedro was extremely helpful, he couldn't have done more. We would definitely recommend his services to friends.
- Rl, AlicanteThursday, May 24, 2018Felt very comfortable at all times. Nothing was too much. Understood everything mentioned in our meeting. Very reasonable rate, money wise.
- KL, Valencia, SpainWednesday, May 23, 2018Inma is easy to talk to, is prompt in replying to emails, is helpful and above all achieved the solution I wanted.
- MF, LanzaroteMonday, May 21, 2018My lawyer Cristina was extremely understanding , friendly and reassuring. With Cristina on my side, it gave me confidence to continue.
- RA, ParisFriday, May 18, 2018The service I needed wasn't complex, just verification of documents, but the service was rapid, friendly and exactly what I needed.My lawyer Julia was bilingual.
- Sham Naib, Callao Salvaje, TenerifeFriday, May 18, 2018My lawyer Oliver was very helpful, always happy to assist. He professionally checked the law before dispensing advice.
- Smith, FranceFriday, May 18, 2018Caroline is bilingual and was very helpful throughout. There is nothing I would suggest to improve. I was very happy with the service and would definitely recommend to friends.
- SJ Thiele,Tuesday, May 15, 2018Inma was very helpful and we were very satisfied with the service overall. We would definitely recommend her services to friends.
- John Stecher, EnglandTuesday, May 15, 2018Very satisfied with the service received. OUr lawyer was very easy and straightforward to deal with. Would definitely recommend to friends.
- Cian O'Grady, IrelandTuesday, May 15, 2018We bought a property in spain and Lidia assisted us through the buying process.
She was very professional and reassured us throughout the process.Her english was very good and we felt that we got ...good value for our money.
- PJU, Torun, PolandWednesday, May 09, 2018Béatriz responded quickly to any queries I raised, with easily comprehensible answers.
Her fee was very reasonable and she proved to be a very personable and approachable person when we finally m...et at the Notary.
- Barry Gracey, Melbourne, AustraliaMonday, May 07, 2018I found Jaime helpful and responded promptly to my emails. I was very happy with the service provided and if needed would use him in the future
- Geraldine King, IrelandMonday, May 07, 2018I was extremely happy with Pedro,and Ana. They were honest,and answered my queries promptly.
Pedro had to evict my squatter tenants, and then organised an estate agent to sell my apt. This agent un...dertook renovating the apt, and got me a good price.
Pedro and his brilliant co-worker Ana finalised the sale and I received the money into my account, without me ever setting a foot in Spain.(Power of attorney).
I will be recommending Pedro to friends, who are going to sell their apartment in Torrevieja. I highly recommend him.
- Joy Ellis, SanxenxoTuesday, May 01, 2018Sabela was extremely professional in her dealings with us, very patient and understanding of the situation and gave very good advice and a good solution to our problem.
We feel very confident that... she has dealt with the complaint against a third party and know that if we need any further assistance in this matter she will be more than able to resolve it for us.
She responded immediately to our contact and arranged a meeting on site to enable us to explain fully the problem we had.
- Caroline R, BarcelonaTuesday, April 24, 2018Miguel has been great!
His English is excellent, he explains everything clearly, emails when he says he will, and is very efficient in the service he provides.
I'd definitely recommend him to ...friends.
- George Salib, LondonMonday, April 23, 2018Jose Antonio was very professional and has assisted me in every step of the purchase of my flat in Alicante.
He also assisted me by advising of the most suitable area according to my needs. His com...mitment and dedication is excellent.
Jose Antonio was very easy to approach and happy to help in any way he can.
I will definitely recommend him to my family and friends.
- Liezl Pulido, PhilippinesMonday, April 23, 2018Rosa never stopped working very hard, she went way above what she needed to do...she never gave up on me and always did more than I thought anyone would.
I am so blessed I got Rosa to help me I co...uldn't have gotten a better lawyer she's the best.
Thank you Rosa from the bottom of my heart you are a wonderful person, I am so grateful to you.
- KJB, United KingdomFriday, April 20, 2018Francisco was professional and efficient. Very good value for money.
- Duncan Martin, Wolverhampton, EnglandFriday, April 20, 2018Lidia, was extremely helpful and patient throughout the process.
She was very attentive and responsive and explained everything in detail.
Lidia represents excellent value for money and the so...lutions she recommended were very beneficial, especially as you hear and read about a lot of horror stories on the web.
Lidia was the best legal representative i have employed and i will always use her where Spanish legal affairs are concerned.
- Julie Smith, TorrellanoFriday, April 20, 2018I can't compliment my solicitor enough.
From our initial meeting right through to my ultimate divorce (with no unpleasant surprises the entire duration of the entire process), he immediately respo...nded to my many enquiries, always had mine and my daughter's best interests at the forefront of any considerations and was well worth every penny of his extremely reasonable fee.
Excellent value for money, totally approachable and very professional and understanding. I highly recommend him and will continue to retain his services for other matters in the future.
- SH, EnglandFriday, April 20, 2018Very satisfied with the service provided. Miguel was approachable and prompt in replying.