Following the customer’s needs, AB House Project will propose a selection of apartments that may be of great interes
Once the property has been identified, it must be verified. The first step is the request for the Nota Simple (the “nota simple ” is an official document issued by the Spanish Real Estate Registry which informs us about who owns the property, if there are any charges (mortgages, privileges, easements …) and the limitations and restrictions that affect the owners and / or the property).
At this point it is necessary to “block” the apartment in order to be able to remove it from the market and proceed c with the subsequent phases.
Normally, 10% of the value of the property is required to be paid into the account of the owner or the real estate agency that represents him.
This deposit can also be made from a foreign current account by bank transfer, but the final balance must be made with a non-transferable cashier’s check necessarily issued by a Spanish bank in the name of the property owner.
At the same time, a purchase agreement is signed (called “contrato de arras”) in which all the aspects of the operation are present (ownership data, interested parties, sale price, conditions of sale, expected date of the deed, .. .)
Normally, between the signing of the compromise and the date of the deed, a period of time ranging between 15 days and 2 months passes to allow the necessary collection of documents to be transmitted to the notary for the correct drafting of the deed of purchase (energy certificate, verification of the lack of debts with the condominium, payment of the IBI – the annual tax on the property -, of the garbage, of the electricity, personal data, marital status, possible translation of documents from the original language into Spanish that must be done by an official translator, amount of any loan to be extinguished – at the same time as signing the deed of sale – or loan to be requested).
This period of time also allows the buyer to obligatorily proceed with the request of their N.I.E. (the N.I.E. in Spain is the “Numero de Identidad de Extranjero”, an identification code for foreigners; a sort of tax code for foreigners, which becomes essential for a large number of practices, from opening a bank account to purchasing of a telephone SIM and in general for all professional, financial or legal activities) and the opening of a current account at a Spanish bank where you can transfer the money necessary to complete the transaction. If requested, our agency will be happy to facilitate you in these practices by following you step by step and acting as an interpreter if necessary.
After the verifications indicated above, our agency will take care of transferring all the necessary documents to the Notary’s office and verifying the final sales document (“escritura”). At the date of the deed we will also be present as official translators, if necessary. Normally the practices relating to the registration of the deed and the related payment and the balance of notary expenses are entrusted to an administrative office (often present within the notary itself) called “Gestoria”. The “Gestoria” will send us an estimated cost (=provision of funds) before the date of the deed, which will be paid by the buyer immediately after signing the deed of purchase. With this “fund” available, the “Gestoria”will pay all expenses previously indicated. If requested, the Management can also take care of the change of ownership of the utilities and the condominium. The domiciliation of the IBI and garbage payment must normally be made by the buyer.
In the event of a loan application, this Gestoriat” is managed and chosen directly by the bank which will provide the “provsion of funds” to be sure that all the post-sale procedure is carried out correctly by having to take out a mortgage on the property itself.
Any positive balance with respect to the provision of the fund will be returned to you by the “Gestoria” itself with the invoices relating to each individual cost.
You signed the deed and the apartment is yours now and you can move in and start enjoying this beautiful island !!
– PRICE OF THE PROPERTY
It is the price accepted by both parties. The buyer must NOT pay any type of additional percentage as a real estate commission because is already included in the sale price and paid by the seller (in other countries the practice may be different).
Even in the case of purchase through 2 agencies that collaborate with each other in the sale two agencies that collaborate in the sale of a property (very common case for the dense network of real estate collaborations on the island), the buyer does NOT have any additional cost as the real estate agencies have an agreement with the seller.
Below we indicate a reliable estimate of the costs associated with the purchase of a property that are borne by the buyer. On average, they can be summarized as 8-10% on the purchase value of the property
– NOTARIAL EXPENSES
The cost of the Notary for a deed of real estate sale varies between 1.000 and 1,300 euros
– PROPERTY TITLE REGISTRATION: about 500 euros
– OFFICE FEE ADMINISTRATIVE: around 600 EUROS
– TRANSMISSIONES PATRIMONIALES TAX (ITP): in the Canary Islands you pay 6.5% of the price indicated in the sale (IN THE CASE OF SALE OF A “SECOND HAND” PROPERTY)
– IGIC: ONLY IN THE CASE OF PURCHASE OF A NEW BUILDING PROPERTY (the Canary Islands government apply an IGIC of 7% on the price indicated in the sale).
– BANK CHECK COST: banks apply a commission on the issue of non-transferable bank draft (called “cheque”). Attention!! Often this commission is significantly reduced by agreeing to enter into a property insurance contract with the same bank (through a company affiliated with the same)
– LOAN COSTS: if a mortgage is requested, the bank costs associated with it must be considered (opening current account, bank commissions, property appraisal, insurance, …)
PLUSVALIA MUNICIPAL: (Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana)):
It is a municipal tax calculated by the property registry office based on land where the property is built and for how many years the sellers have owned the property.
CAPITAL GAIN:
it is approximately 20% tax on the difference between the sale and purchase price, considering some revaluation coefficients of the purchase price.
IBI (Impuesto de Bienes Inmuebles):
the cost of the IBI of the year in which the property is sold is usually shared between the buyer and the seller in proportional parts according to the month in which the deed of sale is signed.
PLUSVALIA MUNICIPAL: (Impuesto sobre el Incremento de Valor de los Terrenos de Naturaleza Urbana)):
In the case of the seller who is not tax resident in Spain, the PLUSVALIA MUNICIPAL is deducted from the sale price and subsequently paid by the buyer.
CAPITAL GAIN:
When the seller is not a resident in Spanish territory, to guarantee the collection of the tax (Capital Gain), the law provides that the buyer withholds 3% of the sale price and makes the payment of this amount to the State Revenue Agency. This 3% is deducted at the time of formalization of the checks that the buyer delivers to the seller at the notary’s office at the time of signing the deed of sale.
IBI (Impuesto de Bienes Inmuebles):
the cost of the IBI of the year in which the property is sold is usually shared between the buyer and the seller in proportional parts according to the month in which the deed of sale is signed.