Do you need a real estate consultant?
It is advantageous to hire a real estate agent who is always at your side. The rules in Mallorca are different when buying a property, as the rules that you know from Germany. The processes can be very time consuming and exhausting. Furthermore, you can hire your consultant to find the right property for you without spending hours on the Internet. A broker usually also has access to off-market and exclusive properties that are not publicly available on the internet.
How many real estate consultants should I contact?
Of course, you have the free choice of how many property consultants you want to contact. We advise you not to hire more than 2 or 3 brokers. With us you can save even, because we cooperate with all agents. Among other things, we have scouts who are just trying to find your dream home. Even if you can not find them on our website, we can help you find them efficiently.
Should I hire a lawyer? And their costs
Yes, we advise every customer to hire a lawyer (Abogado) for additional legal security. For contract drafts, due diligence, or other Spanish bureaucracies, a lawyer is very helpful. Spain offers very high legal certainty when it comes to purchasing real estate, but without a lawyer, unexpected costs can arise if the buyer has not complied with certain processes or documents have not been audited.
The cost of a lawyer varies, depending on the services you use. Mostly the lawyers charge 1% of the purchase price.
Can I get a mortgage in Spain?
Yes, you get mortgages in Spain, they are very much in demand because the interest rates are very low and they can also have tax advantages. You have the option of getting up to 70% of the estimated value. We work with a company specializing in the processing of mortgage loans and other financial products in Spain. You can get the best bank conditions through the service provider.
What is an NIE number?
An NIE (Número de Identidad de Extranjero) number is a Spanish Foreigners Identity Number. All foreigners who have professional, social or economic interests in Spain receive a foreign identity number. The NIE number is an important document that must always be stated in applications, formalities, account opening, contracts (rent, mobile phone), employment contracts, etc. This number also serves as a tax number (NIF – Número de Identificación Fiscal).
Where can I apply for the NIE number?
You can apply for the NIE number at a Spanish consulate, at a police station (Dirección General de la Polícia y de la Guardia Civil) or through a mediator (Gestor).
The option contract
The seller undertakes not to sell to third parties the desired object for about one week to three months (different from case to case). As a rule, an option fee is paid. During this time, the buyer has the opportunity to purchase the property for the purchase price. In general, it is 10% of the purchase price, which must be paid in advance, this sum will be credited at the time of purchase. If, for some reason, the seller is unable or unwilling to sell the property, for example, because he was able to sell the property at a higher price, the seller will normally have to pay back the option fee plus additional damages. This depends on the contract agreement.
The notarial purchase agreement
In order to ensure registration in the land register, a notarial authentication must take place. This is in the Spanish “escritura” geannt.
The notarial deed receives a description of the property, the purchase price and the terms of payment. Also, a notarial purchase agreement is very important to have the security that you take no debt (debits) from the previous owner. The notary will send the certificate of authenticity by e-mail or fax to the property registry so that legal certainty can be guaranteed. After payment of the land transfer tax, the new owner can be entered in the land register.
The purchase costs?
In addition, about 8 to 12% of the purchase price for the purchase costs should be taken into account. The purchase costs include 10% VAT (IVA) for new buildings and 8 to 10% land transfer tax for resale real estate.
The commission is usually paid by the seller, amounting to 5-6% plus VAT. In exceptional cases, the commission can also be paid by the buyer, but this will be communicated to you in good time.
When you purchase a property, you must pay VAT (IVA) or land transfer tax (ITP).
VAT is paid on the first purchase of a property. For a property with garage parking spaces you have to pay 10% of the purchase price. With a purchase of a property or commercial real estate the taxes amount to 21%.
Real estate transfer tax
Resale real estate tax (ITP) is applied.
Up to € 400,000, 8% of the purchase price must be taxed.
Between 400.001 € and 600.000 € must be taxed 9% of the purchase price.
Between 600.001 € and 1.000.000 € 10% of the purchase price must be taxed.
Over € 1,000,000 must be taxed 11% of the purchase price.
After the transfer of ownership has taken place, the land transfer tax must be paid within 30 days.
However, we recommend to hire a tax consultant.
The property tax (IBI Impuesto sobre Bienes Inmuebles) is paid annually at the end of the year. This is Spain-wide between 0.4 and 1.1% of the cadastral value of developed land, but dependent on the municipality. For undeveloped land between 0.3 and 0.9%.
If the property itself is used, even for holiday purposes, you pay an income tax (IRPF – Impuestos sobre la Renta de la Persona Física). The tax is 19% to 1.1% of the cadastral value.
Non-residents, pay between 0.2 and 2.5% property tax. The property tax for residents in the Balearic Islands is between 0.28 and 3.45%.
Capital gains tax
When selling a value added tax (Plusvalia) must be paid. From the time of sale of an object, the municipalities tax the appreciation of a property.