The purchase and sale of a property is without a doubt one of the most important steps in the life of any person, that is why we want to offer you a guide on the most important steps that you must fulfill to realize a investment of Real Estate in Costa del Sol. For this we must clarify mainly that if you are a foreigner you will need to comply with a series of additional requirements, among them the application and procedure of the Foreigner’s Identity Number (NIE) as well as the opening of a bank account in the country to carry Out the payment of the necessary taxes and any related processing, and of course to request a credit if it is necessary.
1- Establish a budget
To the surprise of many, this is undoubtedly the first step to be taken to buy a property on the Costa del Sol, mainly because the real estate offer is really high in the area, and surely when you start Search you will find a large number of houses and apartments for sale, whose prices vary enormously. As experts in real estate, we want to recommend that this budget does not exceed 35-40% of your net monthly income stable, of course considering the amount of money you have saved to carry out this important transaction.
After setting the budget you can start the search of properties for sale in Costa del Sol, since if it is done backwards it is very likely that you end up in love with a property that you may not be able to afford, that is why you must determine exactly the budget when it is done The search for properties for sale on our portal or in any real estate agency.
2- Determine in which city of the Costa del Sol you want to buy a property
We usually hear about the benefits and factors that drive the purchase of properties on the Costa del Sol, however in that region we can find a large number of cities, if for example you like a more luxurious life and Modern, your favorite city may be Marbella, which is also the most important in the area, but if you are looking for a quieter area and concentrate the style of Andalusia may your most suitable city is Estepona.
Now, if you prefer a mountain village but that is very close to the beach then perhaps the most considerable option is Benahavís. There are really lovely cities in this place, such as: Mijas Costa, Benalmadena, Fuengirola and of course Torremolinos; In the latter two you may find prices cheaper than those mentioned above.
3- Determines the payment method
All those issues related to the choice of location and payments are really vital, are the first steps to that great step of buying a astonishing properties in Costa del Sol, and is that in Spain regardless of whether you are local or foreign, accounts With 3 important options:
The cash payment: which is treated as its own name indicates the total cost disbursement that you have managed to establish with the owner with the seller of the property; Usually this type of payment materializes through the delivery of a bank check in favor of the seller, step that is done simultaneously to the signing of the purchase deed.
Now, just here we present one of the reasons why it is important for foreigners to open a bank account in Spain, since it will streamline all payment processes, so do not go to request a bank credit.
Mortgage loan: this option can be studied by both local and foreign, in the case of the latter it will be necessary for the buyer to have approximately 20 to 40% of the total price, since the banks are not currently granting more Of 80% of the cost of the property, and must also contribute all those expenses related to the deeds of purchase and sale and mortgage, which may even reach 15% of the purchase amount.
Likewise, they must show the bank that the monthly payment to be canceled does not exceed 40% of the net monthly income; On the other hand all the requested documents must be translated into Spanish by a sworn translator, however today some banks have their own translator.
At present and according to the buyer’s age, there are some banks that offer repayment terms of up to 40 years.
Mortgage subrogation: this is another important option, which has the advantage of saving tax costs, since it lies in the change of ownership of the debtor in the mortgage, so the buyer is positioned in this way as the new debtor In the rights and obligations that had to the previous debtor. In this case it is advisable that the creditor bank decides to accept the subrogation prior to the purchase, which must be requested shortly in the same bank in which the seller maintains the mortgage of the property to buy.
4- Decide the type of property and start the search
In the different cities of the Costa del Sol you can find a wide variety of apartments, houses and villas for sale, as well as townhouse, penthouse and duplex, that is why we recommend that as well as choosing the budget, also decide what type of Property is more suited to your needs, and is that for example if it is a newly married couple, it may be the best choice to be an apartment as they are smaller, while the houses and villas are intended for larger families Or retiree couples who need ample space to receive their children and grandchildren.
You should also choose if you are interested in new, used or protected housing, the latter being those that have a more affordable price than the one on the market and which will be aimed precisely at those sectors of the population that present greater difficulty to Access to a home of their own. This choice will be vital.
5- If you are a foreigner, you must process the following documentation
However, at this point it is vital to add that at least 13% of the properties sold in Spain are processed by foreign buyers, while in the case of the Costa del Sol, at least 40% of the properties are purchased By foraigners, it is for this reason that we want to explain what documents are to be processed:
NIE: this is the identity number of the foreigner, which is nothing more than a code whose main purpose is to facilitate the identification of those who are not Spanish. In this case it will be vital to carry out any kind of economic transaction. The interested parties must request it in the General Direction of the Police, as well as through the corresponding Consulate outside Spain.
Opening a bank account: at this point it is important to claim that it is not a step is mandatory but it is recommended to do so, since it greatly facilitates everything related to the cancellation of taxes and payments related to the purchase of housing: VAT in new homes or ITP in second hand homes, notary fees, registration, among others.
In this case we want to recommend that you go to professionals who are experts in the subject of buying and selling properties for foreigners, who are able to carry out all the procedures required in the process.
6- Visit the properties that interest you and inspect the place
Usually when we decide to look for a property for sale that interests us, we do it through the real estate portals web or in real estate agencies that show us these spaces through photographs, which are not always updated, that is why it will be necessary That you make a list of the properties that interest you so that later you visit each of them, with the purpose of verifying the state in which they are and if they really comply or not with your expectations.
What should you look at? Well first of all it is important that you observe the way in which the rooms are distributed, as well as the state of conservation of the place, the orientation of the property, if ventilation especially bathrooms and kitchen is adequate, if the decoration is Suits your tastes or you will have to make an investment in improvements, among others. In this same way we recommend that you take advantage of this moment to ask about the energy certificate, that is, the energy consumption of the place, vital for the buying and selling process.
7- Make an offer on the property you have decided to buy
After you have decided which property on the Costa del Sol you are going to acquire you need to make an offer, and is that today buyers request discounts ranging from 10% to 15% of the initial sale price, The time has come for you to negotiate with the seller the final price, and is that a reduction for very small that it will never be of more.
You must go to the property registry: After choosing the property to buy it will be important that you know the inscribed data related to the description of the property, which must conform to the house you visited, since the physical reality may be other than The registration description, there you must verify the ownership and the charges that the property may have to avoid unpleasant surprises. In this case in Marbella, said registry is located at Av. Ricardo Soriano, 19, 29600 Marbella, Malaga.
However, in order to know the circumstances mentioned above you must request a simple note, which shows all the characteristics of the property or ask your real estate adviser to do so, who usually charge between € 9 and € 20.
Confirm the pre-authorization of the mortgage: although it is difficult for the bank to make a pronouncement on the grant of the mortgage without having all the information, you should try as far as possible to make no payment to the seller until That the bank confirms the viability of the mortgage loan you requested.
8- Sign the contract of arras
This is the first contract that must be signed, which is as important as the deed of the house, since it will be in charge of safeguarding the rights of both the seller and the buyer. At the time of making this signature will be necessary an advance of 10% of the price of the property to the seller.
Remember that when signing the contract of arras you will be assuming some rights as to the delivery of the house but also some obligations, which in case of not complying could lead to the loss of the money that you already delivered.
It is for this reason that the deadline for the formalization of the business to be indicated in said contract must be realistic, which could be a month approximately so that you have enough time that in case you have applied for a mortgage, The bank leads to the appraisal of the housing, and the application for the internal authorization.
9- Sign the deed
In this case the buyer and the seller must declare before the notary that they are willing to buy and sell, as well as the essential conditions of said business. The buyer will have the right to choose the notary, who will check the capacity and legitimacy of both. This document will include the description of the house, the price, state of charges, method of payment, distribution of expenses, applicable tax and the distribution of expenses.
The following documents must also be checked:
- Energy certificate.
- Proof of payment of the latest Real Estate Tax.
- Certificate from the owners community.
- Copy of ten-year insurance, if necessary.
10- Expenses of processing and taxes
In many cases we avoid the expenses that derive from the purchase and sale of a property and which represent approximately 10% to 12% of the purchase price. The most important are:
VAT: Added Value Tax in the case of new housing (10%) and ITP: Tax on Real Estate Transfer in the case of second hand home (8%)
Municipal Tax: direct tax, established by city councils, which must be paid by the seller.
Notary expenses: these are the Notary’s fees derived from the preparation of the deed. They are usually borne by the buyer
If you have applied for a bank loan, you will also have to bear other expenses: registration, Notary fees for the preparation of the mortgage deed and Tax Legal Documents Documented by the mortgage constitution.
The process of buying and selling a property on the Costa del Sol will entail a series of steps which have been accurately described above and which will ensure that this process is fully carried out in accordance with the law.
Written by: MARA
Number of words: 2227
Contribution to the reader: it gives the users a very complete guide as to the necessary steps that must be carried out to buy a property on the Costa del Sol.