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Purchase of a new property in Spain Legal Information kindly provided by MSB Abogados La Manga
www.msb.es  I have found the property that I like. What should I do?
A reservation contract can be signed, with a deposit between:
3.000 € to 6.000 € if it is non returnable.
6.000 € to 12.000 € if it is returnable (preferable option).
What is my next step after the reservation has been signed and formalized?
You should contact your Lawyer before the contract is signed, as several details should be checked:
1) The conditions of the land where the property is to be built, mainly:
– a) To check that the promoters have the full ownership over the property, without restrictions or rights in favour of another person to recover the ownership.
– b) To check that the property is free of any charge or debt that may pass to the purchaser.
– c) To check that all the planning and legal requirements to develop are granted.
Is my vendor a reliable Company?
2) Your Lawyer needs to make a detailed investigation about the company that is selling, mainly about the years of existence, previous constructions, financial records, solvency, pending legal proceedings, and the persons that have been authorized by the company to sign on its behalf, to determine that valid powers to sell are being held.
Which legal requirements need to be included in my contract?
3) Your Lawyer must check that the contract reflects all the guarantees granted by the Spanish Law. Some of them are these:
– Fixed price and completion date.
– Obligation of the vendors to produce a Bank Guarantee on each payment, without costs for the purchaser.
– Situation and internal plans of the property and plan of the complex, such as a proper descriptive report with the materials to be used.
– Not to impose the purchaser to take over the constructor's mortgage, and the obligation they have to pay for the cancellation costs if it is not taken.
What happens when the property is completed?
The Title Deeds (“Escritura”) will have to be signed in front of a Notary Public.
It is very important that some requirements are being checked by your Lawyer:
– That the 10 year guarantee on the building is valid and in place.
– That the Habitation Certificate has been issued.
– That there are no charges and encumbrances on the property acquired.
– That the boundaries and description of your property are correct.
Can I sell my property before completion?
Yes, of course you can do it, but there are two ways of doing it:
– Before the signature of the Deeds, by the means of a private contract.
– To sign the Deeds on your name, and then immediately after a new Deeds to the buyer.
Which expenses involve the Signature of the Title Deeds?
The VAT at 7% rate is normally paid during the various stage payments for the property. After the 1st of July 2010 it will be 8%.
Stamp Duty Tax, at a rate of 1%, calculated on the property value (excluding VAT).
Notary & Registry Fees, based on an scale, and amounting to approximately 1.400€ to 1.800 €.
Municipal Plusvalia Tax, between 200 € to 500 €, depending on a number of coefficients.
Is my new property guaranteed?
Yes, of course, the Spanish Law contemplates 3 different guarantees:
– 1 year for snags.
– 3 years for defects affecting the normal habitability of the property.
– 10 years for structural defects.
Do I need something else?
Indeed…… To enjoy your property
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