Cheat Sheet

Buying a Property in Spain For Dummies

Buying a property in Spain has been the shrewdest investment decision over the last ten years for more than 900,000 Britons, so you probably won’t be surprised to find the Spanish market on the radar of many discerning buyers. Spain is also one of the friendliest and most relaxing countries in the world, with thousands of property gems still waiting to be discovered. Use the tips given in this Cheat Sheet to keep the most important factors to remember in mind as you conduct your own property search.

Buying the Right Spanish Property

Just as important as finding the right area for your Spanish real estate purchase is finding the right individual property for you. As well as the obvious things to consider such as location, size and appearance, be sure to consider the following factors as well:

  • Planning issues. The press is full of worrying stories about land grabbing carried out quite legally by Spanish municipalities. This needn’t happen to you: By choosing a good legal advisor, you can protect yourself against possible financial consequences arising out of title deed problems.

  • Check out the property: Access and grounds. Surveys are often only valuation surveys intended to give the lender the comfort of knowing that their money is reasonably safe. If the property is old and in poor repair, get a full survey done and have the document translated into English.

  • Neighbourhood. Research the market before you travel to Spain, but never buy a property without spending at least a few days living in the immediate neighbourhood. Ideally, go back to the area in each of the seasons that you plan to live there.

Deciding on a Region in Spain for Property Buying

Spain is a big country, with surprisingly large differences between regions. Remember that each part of Spain has its own identity and lifestyle, so do your research and decide on the best place for you if you're interested in buying property. Consider these factors:

  • Climate matters. You don’t get sunshine all the time and glorious beaches in every part of Spain. Many areas are very cold in the winter. You don’t even have to be in northern Spain to see snow: You can ski within an hour’s drive from Madrid.

  • Living costs and living standards. In much of Spain the cost of living is lower than in the UK. But some parts of Spain are more expensive than the UK.

  • Cultural fit. Foreigners find it harder to settle in some parts of Spain than in others. The Balearics, for example, see an exodus of foreigners in the winter. Some rural areas have no Brits in residence at all, while in other regions every second person is an ex-pat.

    If you are interested in buying an investment property to put in the hands of a property manager, then not having anything in common with your neighbours won’t bother you – but getting on with your neighbours is important if you are planning to live permanently in Spain.

Researching the Spanish Property Market

Doing your homework before taking the plunge, rather than diving right in at the deep end, is a wise move if you’re considering buying a property in Spain. Get your head around the market before you start searching can save you money, time and hassle in the long run.

  • Deciding your budget. The first decision to make is how much you can afford to spend. Build in extra costs of around 10 per cent of the cost of the property for legal fees, local property taxes, and surveys. Add more if you want to make additions or improvements to the property.

  • Checking out your tax position if escaping taxes is your main concern. You find a lot of misinformation when researching the possible tax benefits of owning a property overseas. Many holiday home-owners find it isn’t possible or desirable to move their tax affairs to Spain. Many more find that they have different aspects of their affairs taxed in both countries. You can pay lower taxes in Spain than in the UK but consider these matters before heading for the airport, not when selling up.

  • Researching pays dividends. You can find out about Spain before you go and save days of time and hundreds or thousands of pounds by narrowing down your choice of desirable properties and areas to a short list of two or three before hunting out your passport.

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