The purchase process for the buyer
Once you have found the villa or flat that corresponds exactly to what you are looking for, the purchase procedure follows.
When the seller and the buyer agree on the amount of the transaction, a reservation contract (Reserva de inmueble) is signed between the two parties. The buyer then pays the reservation fee of 1% of the price of the property. Payment is made directly to the agency. It is retained by the agency because it constitutes the first part of the agency fee which must then be paid directly by the seller to the agency. In the event that the buyer decides to retract, he loses the sum advanced. However, if it is the seller who changes his mind, the amount of the reservation is returned to the buyer.
Once the reservation has been paid, the estate agency starts the purchase process by carrying out the preliminary administrative research. In the first instance, it applies to the Town Hall for the Certificate of No Infringement in Town Planning (Certificado de No Infracción Urbanistica, CNIU). This document is important because it certifies that the property is not in breach of town planning regulations. The time it takes to obtain the certificate is variable and may take up to 2 to 3 weeks from the date of application.
Once this document has been obtained, the agency requests the Simple Copy (or Simple Note) from the owner or applies to the notary with the owner's signed authorisation. This document is issued by the Property Registry (Registro de propiedad). It is a document for information purposes without any legal consideration and its purpose is to assure the buyer that the seller is indeed the owner of the property. It allows you to check the history of the property and provides the following information:
- Identity of the owner of the property ;
- Charges or taxes in force associated with the property ;
- Restrictions on the use of the property where applicable.
Once these steps have been carried out, the preliminary sales agreement (Arras) can be drawn up. This is a contract between the buyer and the seller which is not signed before the notary but will be requested by the notary on the day the deed of sale is signed in order to check the conditions between the parties. The document must contain the following information :
- The identity of the seller and the buyers;
- The address of the property ;
- The selling price of the property ;
- The deadline for signature at the notary's office ;
- The address of the notary where the sale will be signed;
- Any outstanding debts ;
- Means of payment ;
- The distribution of notary's fees ;
- Penalties in case of withdrawal by either party.
On signature of the compromise, the buyer pays 10% of the price of the property. At this stage of the process, if the seller decides to retract, he is obliged to reimburse twice the amount advanced. However, if the buyer withdraws, he loses the entire amount advanced.
The acquisition process is finalised with the signing of the deed of sale (Escritura) at the notary's office and the payment of the remaining balance. The notary fees are calculated according to the purchase price of the property and must be paid by the buyer. It should be noted that notary fees are not very high in Spain.
The duration of the sales process can be reduced to one month if the buyer so requests.
The sales process for the seller
The role of a real estate agent is to represent the interests of his clients at every stage of the buying and selling process.
This is why the real estate agent to whom you have entrusted the sale of your property must ensure that all stages of this process are carried out with the utmost professionalism.
He must take into account and value what makes each property unique and attractive, in order to help his client find the ideal buyer for his property.
The sales process begins with the best possible presentation of the property through its enhancement: detailed description, quality photographs and referencing on the Internet.
Once a buyer commits to the purchase of a property, a prior agreement is made between the two parties and a sales contract is drawn up. This contract includes at least the following information:
- The contact details of the buyer and the seller;
- The price of the property including agency fees;
- The specifications of the property concerned;
- The amount of the deposit to be paid by the buyer.
After signing this contract, the legal conformity of all these documents must be checked by a lawyer. It is up to the buyer to choose the notary.
For the seller, the cost of the sale of his property includes the payment of various taxes and charges summarised below:
- Capital gain (Plusvalía), where applicable: national tax on property capital gain;
- Impuesto sobre Bienes Inmuebles (IBI): local property tax on real estate;
- 3% non-resident withholding tax, if applicable: non-residents are subject to this withholding tax, which does not apply if you declare your residence in Spain;
- Balance of water and electricity supply contracts;
- Balance of community fees (gastos comunitarios), if applicable: corresponding to the condominium fees;
- Mortgage cancellation fees, if applicable.
