Real estate in Spain: the purchasing process
Obtaining a NIE
Before you start looking for a property, you will have to obtain a the Alien Identification Number (NIE). This number, mandatory for foreigners wishing to buy or sell a property in Spain, is issued by the Spanish immigration department: you will have to go to the Oficina de Extranjeros (Immigration Office) or the Office of National Police, with a valid passport and a recent passport photo. We advise you to be early!
Checking the “Nota Simple”
As elsewhere in the world, you should check a few details to avoid bad surprises before purchasing a property in Spain. Ask the seller to produce the “Nota Simple”, a summary of the land title registered at the local land registry. With this document, you can check the identity of the legal owner, make sure that there are no mortgages on the property and that the apartment or house that you visited is really the one that you are about to buy.
Other checks, more technical, can be carried out, especially when buying a house or land lot. In this case, you could as well check with the planning department about possible construction projects in the vicinity.
Making an offer
The price of a property can be negotiated. Do not hesitate to do so, especially in a real estate market where the supply tends to exceed the demand. Making an offer is a common way to initiate the negotiation of the property.
Signing the private contracts
Once the negotiation is over, signing a private contract stating all the necessary information (price, details of both parties, an accurate description of the property, date of registration of the sale) will formalizes the sale. The buyer must then pay a deposit, which generally amounts to 10% of the purchase price. According to Spanish Law, this deposit must be paid directly to the vendor or the developer selling the property, or also to a trusted intermediary (often the real estate agent involved in the transaction). The deposit will not be refunded to the buyer if he decides to reverse his decision. If the seller is the one who withdraws, he will have to refund to the buyer double the deposit he received. The purpose of this measure is to protect the buyer.
Financing your real estate purchase in Spain
You can usually get a mortgage from your home bank, or directly from a Spanish bank. You should be aware that, in Spain, housing loans are often under variable rate. If you apply for a loan from your home bank, your bank will probably ask you to submit as collateral a property located in your home country. Mortgage credit is a common practice for the acquisition of property outside your home country. The principle of the mortgage will apply in many European countries.
The registration of the sale
The sale must be recorded with the Spanish property register, the “Registro de Propiedad”. This step includes the signature, in the presence of a notary, of the official sale document called the “Escritura”. This document will then be integrated with the “Registro de Propiedad” by the notary. This step usually takes between 2 and 4 months.