It is straightforward for Kuwaitis to buy property in Spain. After finding the perfect property the buyer makes an offer through Great Portland. If this is accepted, then the buyer and seller sign a preliminary contract (contrato privado de compravento) and the buyer pays a deposit, typically 10 percent of the purchase price.
As you don't need to be resident to purchase a property, you can buy an apartment before you arrive! However, this naturally comes with certain risks and we strongly recommend that you view the property you want to buy and don't cut corners on the process.
The buyer then arranges any mortgage they require through our finance partners in Spain. The contract of sale (escritura de compravento) is usually signed in front of a notary, at which point the full sale price, taxes and other costs become due.
When buying a new-build or off plan apartment, at minimum you should:
Most of this information can be provided by the land registry and accessed by making a request by email, phone, fax or in person. You can find the appropriate land registry office by visiting the national website: www.registradores.org
The services of a notary are not legally required to complete the sale, but it is advisable and required by many mortgage providers.
Paying the costs and taxes associated with buying a home can be completed by the buyer or their agent. It is the buyer's responsibility, however, to ensure taxes are paid.
The buyer is also responsible for registering the property. The notary may provide this service for a fee, and/or may notify the registry office that the sale has taken place, without completing full registration.
Costs are primarily paid by the buyer, and vary from region to region. Many are negotiable – there are no fixed fees for lawyers or agents. Costs paid by the buyer are typically around 9 –14 percent of the property value and include:
Spain has a capital gains tax of 21–27 percent and is paid on the profit of selling your property, i.e. the difference between the listed purchase price and the listed sale price. Thus if you pay €200,000 for a property and sell it for €250,000 you will pay capital gains tax on €50,000. However, if you previously accepted to list the purchase price as €150,000, you will then be required to pay a capital gains tax on €100,000.
Any lawyer practising in Spain should be registered with the local bar association (Colegio de Abogados). They will have a registration number that you can ask for and then verify with the bar association.
Most private investors from Kuwait buy newly built apartments or houses. There are various reasons for this. New properties are likely to be cheaper to maintain and more energy efficient, some offer a porter or concierge service and are often finished with the latest fittings.
They also have attractive payment plans in place where often only 20% is required on exchange of contracts, 10% 6 months after exchange and 70% on completion.
If the property is registered with the National House-Building Council (NHBC), it will come with a 10 year warranty and protection scheme. There are also specialist companies that provide warranties and insurance for new homes. Once you’ve found a home you like, your advisor will contact the seller with your offer.
Think About costs - Remember, you will have to cover not just the property purchase price, but expenses such as mortgage fees (typically anything between £0-£2000) and Stamp Duty on properties costing more than £125,000.
After your offer is accepted, you will need to exchange solicitors details with the seller. A solicitor is a lawyer specialising in buying and selling properties that will prepare for you a contract for sale. They will also notify the Land Registry that you have bought a property and deal with your title deeds as well as carry out all necessary searches to make sure there are no planning or local issues that might affect the property’s value.
If you’re buying with a mortgage, your lender is likely to conduct their own valuation. But even if you are paying cash, an independent survey is worthwhile to uncover any major faults before you invest. There are two main surveys available for those buying a property: a Homebuyers report and a full building survey.
A Homebuyer’s report is the cheaper option and is likely to be adequate if the property is in a reasonably good condition. The full building survey is more expensive as it assesses the property’s condition in more detail. So it’s a sensible option if the property you’re interested in is much older or has listed status.
If you are buying in a new build development, consider hiring what is known as a snagging company, to catch any faults or hitches before you move in. These could range from poorly fitted cupboards or more serious issues with the building’s structure. Spotting these problems before you buy the property, and asking the builder to correct them – could save you money – and months of hassle.
Once the survey is complete you might want to renegotiate the purchase price.
If there are no delays, then you should receive the contract to sign and complete the sale right away.
Before signing the contract, go through it with your solicitor to check that all the details are correct.
Make sure you understand what the seller has agreed to leave in the property and that all your queries have been answered.
The seller might also ask you to pay a holding deposit to show intent.
Once you’ve exchanged contracts you’ll need buildings insurance in place to cover the structure of the property.
Buyers of residential property will have 30 days from the completion date to pay Stamp Duty. Your solicitor will usually arrange this for you.