Looking for your new home abroad? Spain might be just the place. Whether you imagine yourself in a villa by the coast enjoying those long summers, or a trendy apartment in a vibrant city, we’ve got you covered!
Spain is a country of vast culture, fantastic cuisine and a high standard of living. Its cities have great architecture around every corner, and its countryside and sunny coasts are famous for their stunning scenery. Spain boasts first-class healthcare, education and no restrictions on foreigners buying property. As there are property types to suit every buyer, it won’t be hard to find the perfect place. Already tempted? Here are some of the most important steps in the process.
THE ROLE OF YOUR RE/MAX AGENT IN SPAIN
A good agent means the difference between a stress-free buying process – or the disaster of buying a property that just wasn’t meant for you. Fortunately, your RE/MAX agent will speak your language and take you step by step through the entire process. As a local expert, your agent can recommend properties the moment they come onto the market, and their information about the region is indispensable – they’ll advise you on the schools, transport links and neighborhoods, as well as cater to your specific needs.
THE BUYING PROCESS IN SPAIN
Knowing the purchase process in advance will help you avoid stress, problems, and shocks in the future. Your agent will inform you about the various mortgage products that you can access in case you need financing, as well as the minimum savings you will need to carry out the purchase. There are many aspects to consider in this process, but do not worry because your REMAX Agent will guide you through every step!
To buy your new home, you will need an Identification Number in Spain.
If you are not going to be a resident in the country, you must apply for the so-called NIE of temporary non-resident, which is valid for 90 days. The request can be made in Spain, by going to your nearest police station, or through a power of attorney with a local law firm in case you are abroad. The NIE is essential to be able to sign the deed of sale and mortgage and it also needed in many banks in order to be able to request a study for a mortgage loan, so it is convenient that you do it as soon as possible if you are decided to buy a property in Spain considering two aspects:
The validity is 90 days and must be valid on the day of the closing of the sale.
You must prove to the police station a reason that justifies your request, in this case the purchase of a property, through a deposit contract or with an express declaration of your willingness to buy before a notary.
A very important step before looking for the house of your dreams is to define a realistic purchase budget, considering the expenses of the purchase and in the case of assistance with financing, your maximum borrowing capacity and the savings necessary to undertake the investment. Again, your REMAX Agent will help you in the process.
If you are going to need financing, you should take into account some aspects:
The mortgage process usually takes between 45-60 days; therefore, it is important that you do not leave it all for the last minute and that you are quick to provide the documentation requested by the bank for inspection
Depending on your country of origin and your financial capacity, the bank will finance part of the purchase. The usual is between 60% and 70% of the final price, you should have some savings.
It is also important that you consider the purchase expenses: notary, registration, agency, and taxes. These vary depending on the autonomous community and are around 10%, so you should have enough savings to cover them.
Many entities, as we indicated above, will request the NIE to be able to perform an analysis of you loan capabilities.
The mortgage loan is only approved when the bank issues you the documents called FEIN and FIAE. These documents are valid for approximately one month depending on each entity.
However, the REMAX mortgage department is at your service to help you, without cost or commitment, to choose the best financing for your purchase and be alongside you throughout the financing process.
Once you have chosen the house of your dreams, you must make an offer to the owner and in case of being accepted, sign the deposit. The role of your REMAX Agent is this step is key to help you make informed decisions. He knows the market, the last sales made in the area and the actual closing price of other homes in the same neighborhood which it will give you valuable information so you can buy your house at the best price possible.
Your REMAX agent will defend your purchase proposal with the owner and/or his representative agent, praising your strengths as a buyer. He will also define a negotiation strategy with you in case the seller makes a counteroffer.
Once your offer has been accepted, you will express your intention of purchase in a document called ARRAS PENITENCIALES, which will be signed by both parties along with the delivery of a percentage of the purchase price on your part as a symbol of firm commitment.
In case of breach of contract on your part, you will lose the amount delivered, and if the other party is the one who breaches it, the seller must return the amount of the deposit doubled as compensation. It is very important that at the time of signing the ARRAS, you are clear that you have the necessary savings and the bank approval for a loan in firm, if you need it, so as not to incur in the loss of the money delivered.
The next step is to go to a Notary to formalize the deed of sale and the mortgage, if necessary.
Your REMAX Agent will be responsible for carrying out all the document and registration checks to ensure that your purchase is made with all the guarantees.
WHAT IS THE BEST PLACE TO BUY IN SPAIN?
Deciding where to buy in Spain will come down to taking into consideration some factors such as: your budget, the lifestyle you are looking for, the weather, the gastronomic offer or public transportation. If you’re looking for a laid-back lifestyle in the sun, the coast could be your place.
ASK YOURSELF THE BIG QUESTIONS BEFORE YOU START LOOKING FOR A PROPERTY
Questioning whether you prefer city, the coast, or the countryside, is much more than the landscape you dream of waking up. Do you expect a friendly expat community where you can adapt easily, or do you prefer to integrate with the locals and fully immerse yourself in their lifestyle?
Each region of Spain has its own culture and traditions to explore, so don’t take the decision lightly. The reason you’re choosing to move, or buy a second home, could define the type of property you’re looking for.
Visiting the country several times allows you to get a better idea of the type of neighborhood and property you want to acquire.
Your RE/MAX Agent can show you the best homes in the places you like, maybe even areas you hadn’t thought of yet, that´s why he will spend a lot of time getting to know you, your family, and your needs. This is the best way to help you find your home, your new home!
If this all sounds good, you’re ready to take the first steps. We invite you to visit different areas of the country to define your purchase area, look at some properties online and familiarize yourself with the market, but the most important thing is that you have a professional on your side, so get in touch with a RE/MAX agent to get going and solve all doubts. You’ll see how easy it is!
One of the most frequently asked questions by homebuyers is what are the costs added to the purchase price. In order to explain them, we must separate between purchases of new builds and second-hand properties, as their taxation is different:
VAT (Value Added Tax): 10% of the purchase price. For example, for a property with a price of 200.000 €, the VAT would be 20.000 €.
AJD (Stamp duty tax): This is a tax levied by the autonomous community in which the property is located and its taxation depends on it. The following table shows the different rates at the time of writing this article:
In special cases, such as for disabled people, large families or people under 35 years of age, some autonomous communities apply reduced AJD rates. If you are looking for a property, at RE/MAX Beach Homes we will be happy to assist you with all the issues involved in buying a property, and of course to help you find the most suitable one for your needs.
ITP (Property transfer tax): Like stamp duty tax, it depends on the autonomous community in which the property is located. Until 31 December 2021, the purchase value was used as tax base to calculate the ITP, but this situation changed from 2022 with the introduction of the new “Reference Value” by the Dirección General del Catastro (General Directorate of Cadastre). From this year it is the tax base for the calculation of other taxes in addition to the ITP such as Inheritance Tax, Wealth Tax, Income Tax or Municipal Capital Gains Tax. You can check the cadastral value of a property on the Cadastre website (you must identify yourself digitally). At the time of publication of this text it is as follow
As with stamp duty tax, in special cases some autonomous communities apply reduced rates of the Property transfer tax. Also as in the previous case, the reference value of the land registry is used as the basis for its calculation.
The sale and purchase of a property entails other expenses apart from taxes and which are borne by the buyer:
Notary fees: Although in Spain it is legal to carry out a sale and purchase with a private contract, it is highly advisable to opt for the purchase before a notary to avoid problems. Notary fees depend basically on the amount of the transaction, the number of pages of the deed and the number of copies of the same, so it is not possible to know in advance the exact notary fees, but it is usually a value between 0,5 and 1% of the price of the property.
Land registry: The land registry is a public institution with the function of certifying the legal conditions of a property. It is the best guarantee that an owner can have to prove the ownership of a property to third parties. The registry fee is based on the value of the property and is governed by tables. It is usually between €150 and €400.
Agency commission: Some agencies charge a commission to the buyer and, although it may be a fixed price, it is usually a percentage of the purchase price, normally 3%. This commission is hidden from the buyer, it is not reflected in the advertised sale price, so we advise you to always ask the agency if they charge this commission. At RE/MAX Beach Homes we do not pass on any commission to the buyer and the price we advertise is the final price, with no hidden agency commissions.
Lawyer/Administration: It is highly recommended to hire a lawyer to audit and manage the purchase of a property. Although the land registry informs about the legal situation in terms of mortgages, charges, usufructs, etc., there are circumstances that sometimes owners do not communicate nor they legally register, such as extensions of the built area that must be legalised to avoid problems in the future. On the other hand, non-resident buyers in Spain, need to obtain a NIE, pay taxes and register the property in the land registry so the hiring of a lawyer is doubly recommended in these cases.
Playa Flamenca is a residential area located in the south of the province of Alicante, close to bigger towns such as Torrevieja or Alicante (in the north), or Pilar de la Horadada, San Pedro del Pinatar or Cartagena (in the south). It belongs to Orihuela Costa, which is a district of Orihuela, and borders with La Zenia to the south and with Villamartín urbanization to the west. Playa Flamenca is located near two international airports: Alicante-Elche Miguel Hernández, 45 minutes away, and Region of Murcia, 40 minutes away. It also has a very good road connection with the beaches and areas of tourist interest on the Costa Blanca.
It is surrounded by all kinds of services such as restaurants, bars and supermarkets. Just 1km away is the Zenia Boulevard Shopping Center, the largest shopping center in the province of Alicante, with an area of 160.000 m², 5.000 parking spaces, 150 stores where we can find the main brands in fashion for men, women and children, sports, footwear, perfumery, food, telephone, accessories, home, bricolage, jewellery, toy store, pet shop, etc.
In 2020, the residential had around 1.700 inhabitants, the majority being British, German, Belgian and Scandinavian.
Playa Flamenca has two beaches, La Mosca and La Estaca, both holders of the Blue Flag badge since 1992 and the Q for “Tourist Quality” awarded by the Ministry of Tourism since 2014:
Cala Mosca: is a small cove of golden sand, 70 meters long, sheltered by rock formations and a large sand surface of 6.279 m², perfect for carrying out beach activities. It borders in the north with Punta Prima and in the south with Cala Estaca and is accessible from the N-332 road.
Cala Estaca: located just a few meters away, has a length of 224m and an area of 6.778 m². It limits to the north with Cala Mosca and to the south with Cal Cerrada (La Zenia). Like Cala Mosca, it has golden sand and is accessible from the N-332 road. Both coves are joined by the Playa Flamenca promenade, which has an original sundial and continues to Cala Capitán.
During the whole year, Playa Flamenca has two bus services from Costa Azul company that connect it with the rest of the Orihuela Costa urbanizations and with the Torrevieja bus station, from where many connections can be made with other cities in Spain. You can access all the information on the lines in the service app or in the following links:
A few kilometers from Playa Flamenca is located the Orihuela train station, which has both conventional and high-speed train services, making the Orihuela-Madrid journey possible in less than two and a half hours. Orihuela’s urban and interurban bus services are also located at the station.
Alicante Airport (IATA: ALC), (officially Alicante-Elche Miguel Hernández Airport), is the 5th busiest airport in Spain after the airports of Madrid-Barajas, Barcelona, Palma de Mallorca and Málaga-Costa del Sol and it ranks among the 50 busiest within Europe. It is located about 45 minutes from Playa Flamenca by car and a bus service connects it to the center of Alicante every 20 minutes. Link with information: https://www.alicanteturismo.com/en/public-transport/
Playa Flamenca is a privileged environment for its tranquility and has a wide range of bars, restaurants, supermarkets, schools and services. The Zenia Boulevard Shopping Center, the largest in the province of Alicante, is located a few minutes from Playa Flamenca. There are 150 shops there and it holds regular activities and concerts for the whole family. The Playa Flamenca area is located in one of the best and most important golf areas in the Mediterranean with five excellent golf courses of recognized international prestige: Campo De Golf Villamartín, Club De Golf Las Ramblas, Real Club De Golf Campoamor, Las Colinas Golf & Country Club and Vistabella Golf.
Playa Flamenca has around 6 km of bicycle lanes from Campoamor to Punta Prima, which allow anyone to enjoy the area while having a bicycle ride with the safety offered by this exclusive route for cyclists.
Playa Flamenca has a wide range of restaurants ( The Lobster and Surfers Bar & Grill stand out), pubs with live shows and supermarkets from large chains such as Carrefour, Lidl or Mercadona. In addition, every Saturday from 9 a.m. to 2 p.m., a street market takes place on the street Pintor Ribera, where you can find all kinds of products at a good price.
In Spain, as we all know, the purchase of a property entails the payment of taxes after signing the corresponding deed, specifically: VAT and Stamp Duty for new-build homes, and Property Transfer Tax* for second-hand properties. The method used for the calculation of the latter has changed as from 1st January 2022, Law 11/2021 to prevent and fight against fraud came into force, which includes a modification of the base tax used to calculate the Inheritance Tax and the Property Transfer Tax. Until that date, the tax base they used was the real value of the sale declared in the deed, unless the tax authorities could demonstrate that the market value was higher.
In order to reduce the judicial processes derived from these cases, the new law has introduced a ‘reference value’ that will be used as the tax base for the calculation of the taxes mentioned above. This means that if, for example, before we had to pay 10% of the purchase price of the property for Property Transfer Tax in Comunidad Valenciana, now we will have to pay 10% of the ‘reference value’. This value will be determined by the General Management of the Cadastral Home Value based on the prices of the sales declared before a notary and taking into account the location and type of the property. However, it will not take into account the state or, for example, if a refurbishment is necessary (which implies a devaluation of the price), so it is possible that the ‘reference value’ is, in certain cases, much higher than the market price. In any case, buyers can claim, providing evidence, if they consider that this value is higher than the market value, although the General Management of Cadastral Home Value states that this value will not exceed the market value and that a reduction factor will be applied with this purpose.
*The taxation for Property Transfer Tax in the Valencian Community at the time of writing this text is 10%
Housing prices in Europe are rising at the fastest pace since 2006, S&P Global said, as the residential home market recovers from the pandemic faster than other sectors of the economy. The report also said that while inflation may have peaked.As supply of new housing is not able to keep pace with structural demand, S&P expects the rise in housing costs to continue over the next four years. One major reason for the rise is that people have accumulated savings during the pandemic due to lockdowns and restrictions on going out. With more savings put aside, households have been able to put down larger deposits.
Also, lower borrowing costs have contributed to rising house prices, as central banks loosen monetary policy as a response to the pandemic. Interest rates fell to a new record low of 1.32% for new housing loans in the eurozone in August.
While there is growing demand for property, there are also more acute supply constraints, after construction activity was put on hold at the onset of the pandemic. People are looking for different types of property since the pandemic, most wanting more outdoor space after been confined for so long in their homes.
If you are thinking of buying in the near future, maybe now is a good time as prices are still stable. Contact us and let us help you find your dream property, whether you are looking for a holiday home or permanent living.
We are back on television sponsoring football ! REMAX will be on the publicity boards on the First Division grounds during the whole Spanish professional football league this year, one of the most important leagues in the world.
9 STADIUMS (Valencia, Atletic de Bilbao, Celta de Vigo, Levante, Elche, Getafe, Rayo Vallecano, Real Sociedad, Alavés), 157 GAMES, 246 METRES LONG ADVERT WITH A TELEVISION COVERAGE OF AN ESTIMATED 120.000.000 AUDIENCE
Even though this past year has been different there was something which didnt change in REMAX, and that was the International and National recognitions we achieved. Forbes, REAL Trends, Entrepreneur Magazine, HousingWire, and Consumers Choice are some of the awards we were chosen for in our network.
Looking back 2020 started very strong, it was a year with high expectances and then in March everything went wrong, not only in our sector, but in everyones lifes. Despite the pitfalls and the uncertancy, RE/MAX agents were capable to overcome themselves and for many this has been the best year of their careers. In the same way that the REMAX brand has received many achievement awards in 2020, bringing home many diplomas and prizes.
Because of this unusual year these prizes are even more significant as they demonstrate the strength of the brand and proove that we are prepared to cope with difficult situations like a crisis or uncertainties.
Now we are going to go through some of the main achievements from 2020, Would you like to join us?
Excellent numbers globally also
REMAX agents worldwide did not stop working throughout 2020 no matter how complex the year was. We closed 1.78 million transactions worldwide which works out at an average of 14 transactions per agent In the middle of the pandemic!!
For the twelth consecutive year, REMAX is the number one brand of Real Estate franchaises in the Franchise Times 200 ranking
At number 16 of the general rankings for franchaises, REMAX joins well known brands like McDonald’, 7-Eleven and Taco Bell who are also on the list.
REMAX International was named as one of the fast growth franchaises for seventh year running by the Entrepreneur magazine
REMAX likes to grow quick and the whole world knows this! This is the 19th time REMAX is on this list. So quick that we already have done our numbers and know that we have done it again for the 8th year running. The interest people have at becoming a REMAX franchais owner is still very high!
A great year for REMAX Spain aswell!
Even though 2020 was an uncertain year for the market, the numbers we closed the year with leave us a positive outlook as we took over the 2019 numbers.
Agent associates of REMAX Spain took part in a total of 11.753 real estate transactions last year, over taking the 8.600 of the year before. The value of the properties, sold and rented, reached 919.369.754,86 € against the 2019 total of 909.858.841,91 €.
Without doubt one of the best numbers we have seen especially given the hard times we are in. This just goes to show that buyers and sellers feel the need to have a professional real estate agent by their side.
REMAX Spain has been choosen for 4th consecutive year as the “consumers choice award” as the most valued real estate company.
And this without doubt is one of the best aspects we value, the opinion of our clients. The positive experience of our clients is our principal objective. Thsi means that we offer a good service in the whole buyer and selling process of a property, satisfying our clients needs with our services. Job well done!
Would you like to receive the latest news on our properties?