You may be interested in buying a house in Spain for a long term stay, change of employment, or enjoy retirement. In Spain, buying a property is a relatively straightforward process. Nevertheless, it would be best if you were very careful not to fall for fraudulent schemes. Below we listed the most important precautions to avoid a bad experience while buying a property.

When looking to move abroad, Spain is one of the best places you could choose to make your move! In fact, Spain is ranked as the best country in Europe (2nd in the world) for quality of life as an expat, according to the HSBC expat explorer survey.

When you buy property in Spain, it is important to consider all aspects of the purchase, and know the characteristics of the market before you buy!

Real Estate Expert

Real Estate mistakes to Avoid

As with buying property anywhere, it is important to be aware of those you are doing business with and to be careful about the agreements signed. Most mistakes involve failing to check details of agreements and can be solved by being aware and consulting with experts. Our real estate team recommends you avoid these key mistakes when purchasing a property:

  1. Not checking for irregularities in houses that may affect its legality (i.e., missing licenses):

When purchasing a house, it is important to make sure that all aspects of the house, including new renovations or alterations, have been made legally in accordance with local regulations. Missing licenses or renovations not up to code can cause major problems for a homeowner in the long run. 

The best way to avoid these problems is to ask and investigate before purchasing a property, or consult with real estate lawyer who can provide property advice before purchase!

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Investing in Spanish real estate can be hazardous if you don’t work with an expert legal team. That’s where we come in – our dynamic team of Spanish real-estate lawyers will help you invest in Spanish property efficiently and safely.

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Land registry
  1. Land Registry Issues:

Before purchasing a property, it is necessary to first check if the property has been registered with the Land Registry. If your property is not legally registered, your investment’s value can drop dramatically. It is best to verify land registration through a real estate lawyer to avoid this mistake. 

After signing the deed to a just-purchased property, it is necessary to send the deed as quickly as possible to the registry of deeds office. If manageable, it is best to send the deed by fax the same day it is signed. As long as the property is not registered in your name, charges can be registered against the property, and you will be liable for the charges, as you are the legal owner. 

  1. Verbal Agreements:

When buying property, a mistake many make is agreeing to sales conditions verbally, rather than in writing. When discussing conditions, there is room for misunderstanding between buyers and sellers, which could result in you paying more than you had anticipated. 

The best way to ensure you know exactly what you need to pay is to work out sales conditions (which include tax payment, property inventory, and timing of purchase, etc.) in writing. Additionally, having a real estate lawyer negotiate for you will make you more likely to receive more favourable conditions and less likely to be scammed into sales conditions not previously agreed upon.

This principle applies to agreements beyond sales conditions — it is always in your best interest to have agreements in writing so that each party clearly understands the conditions and is less likely to violate them. 

  1. Being Afraid to Negotiate

One thing many buyers are nervous about is the negotiation and will take the listing price as their purchase price when buying a house. It is important to remember that there is always room for negotiation with homeowners when buying their houses. If you do not negotiate with the real estate agent, you will likely pay more than necessary for the property. 

When negotiating, it is important to understand why the house is for sale or has been for sale so long. Lengthy listing timelines do not mean that a house price will automatically be negotiable — sometimes there are stubborn sellers. However, negotiation is almost always an option you should take advantage of before agreeing to buy!

  1. Mortgage Clauses:

When buying a property, mortgages are often a necessary aspect of the purchase. In Spain, some banks may require property owners to complete a mortgage agreement. 

Because of this rule, buyers should consider including a conditional mortgage clause in their contract. In this case, the contract will be void if the buyers cannot acquire a mortgage and will not be required to pay for a house they cannot afford without a mortgage. 

Can I take out a Mortgage in Spain as an Expat?

As an expat, you are permitted to take out a mortgage that will generally cover 60-70% of the property value. However, you may receive better rates as a Spanish resident. Additionally, repayment periods vary for residents and non-residents. Spanish residents may receive a longer repayment period, up to 40 years, while non-residents may be required to pay back their mortgage in 5-20 years. 

Non-residents are also usually asked for additional documentation, which may include their credit scores from their home country. They will also pay different tax rates on their property as a non-resident. These differences exist, but it is definitely still possible to receive a mortgage in Spain as an expat!

Required document Checklist  

  1. NIE Number (information here on how to receive an NIE number)
  2. Passport Copy
  3. Marriage certificate (if necessary)
  4. Purchasing Agreement
  5. Proof of employment income
  6. Documentation of debts and assets currently held
  7. Latest Income Tax return
  8. Proof of property tax payment
  9. Copy of Property Deeds 

Is my Immigration Status Tied to a Real Estate Investment?

Your immigration may be tied to a real estate investment if you choose to use the Golden Visa. If you invest a certain amount of money over the designated threshold into Spanish Real Estate, you may be eligible to apply for the Golden Visa, a fast and simple immigration process. More information about the Golden Visa program can be found here

If you are not immigrating to Spain via the golden visa, your property investment should not be tied to your immigration as a necessary condition. Some immigration pathways to citizenship require residence in Spain for extended periods of time but do not require that residence to be in a purchased property. 

Buying property in a foreign country can be confusing — it is important to consult with an expert to avoid making common mistakes! Lexidy is here to help and will help you navigate through the real estate process while helping you avoid expensive errors. Please visit our real estate tab for more answers to your real estate questions! 

Infographic with the most important things to avoid before buying property

Infographic What to Avoid before Buying Property in Spain 2021

How can a Real Estate Lawyer Help Me?

If you are looking to buy property in Spain, Lexidy’s lawyers in Barcelona and Madrid can provide you with advice and assistance when purchasing property, signing lease agreements, and more when moving. As experts in their field, they are the best people to help you avoid common mistakes when buying property!