Steps on how to buy a flat, a house, a building (a property) in Spain when you are a foreigner.

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Buying a property can be a pleasant experience, especially when the whole process is under our control and all that is left for us to do is enjoy the excitement of buying a new house.

However, this experience may not be as exciting as we expected if the property, we plan to purchase is in another country whose culture, language and above all, legal system we do not know.

In these cases, the best solution is to find a good professional who can guide us in this process of buying a property. However, if we want to do it on our own, we will explain the steps to follow to buy a property in Spain.

First of all, if the buyer of the property is a foreign physical person, he or she will have to prove before the Notary his or her Foreigners Identification Number (NIE) in Spain. This number is obligatory for doing transactions in Spain and has nothing to do with the residence permit in Spanish territory. The NIE can be obtained at the police station in Spain or at the Spanish Embassy or Consulate in the foreign country.

Although it is true that it is not obligatory to have a bank account opened in Spain to buy a property, it is highly recommended to open a bank account for non-residents in order to document the transaction and proceed to pay the corresponding taxes and expenses.

Once we have identified the property we wish to acquire, we will have to make the necessary checks to know who the owner is according to the Land Registry and what burdens affect the property.

Very often before proceeding to the purchase of the property before the Notary, a previous contract is signed that is called “contrato de arras”. This contract includes the seller’s willingness to sell the property and the buyer’s willingness to buy it and a certain amount is also given on account of the final price of the sale.

After signing the above-mentioned deposit contract, we can sign the purchase of the property before the Notary of our choice.

When the original public deed of the Notary is already in our possession, we will have to pay, according to the cases explained below, the corresponding taxes, which are the following:

  • Value Added Tax (VAT) in the case of first transfer of the property.
  • Transfer Tax (ITP) in the case of a second transfer of the property.
  • Tax on Documented Legal Acts (AJD). It is applied when VAT is paid, and the property is purchased with the help of the mortgage.

Once the taxes have been paid, it will be necessary to submit the public deed of purchase for its registration in the corresponding Land Registry.

Once you have acquired your property, you will have to remember to pay the annual recurring taxes that should be paid for owning a property in Spain, including property tax (IBI), wealth tax, if applicable, and personal income tax (IRPF) if you are permanently resident in Spain or, if not, non-resident income tax.

This whole process can seem very complicated and exhausting. For this reason, our team of professionals is at your disposal to help you as much as possible so that you can only enjoy the excitement of buying a property in Spain.

Do not hesitate to contact us and we will be delighted to help you!

Departamento Mercantil e Inmobiliario

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