Q. Payment terms?
A. This depends on whether you are buying new or resale property:
New/Off Plan – Deposit 3,000 Euros (approx £2,000) to reserve the property. Typically a further 25% to 50% will be due within 4 – 8 weeks of the reservation date and the balance is then normally paid in stages through to completion. The stage payment terms can vary between developers.
Resale – Deposit of 10% to reserve the property with the balance due on completion, normally within 6 – 10 weeks.
Q. Any additional costs?
A. Yes, In Spain typically you need to account for additional costs/charges over and above the purchase price of your property of a minimum of 12% of the purchase price to cover the 10% IVA (Purchase Tax) on the property, legal fees, and other sets up costs.
Q. Will, I need to open a Bank account?
A. Yes, you will need to open a Bank account in the country in which you are buying a property. We can advise and assist you with the process.
Q. Should I use a Local Solicitor?
A. We would recommend engaging the services of a local solicitor who is English speaking and based in the area in which you are buying your property. We can recommend a solicitor.
Q. What is an NIE number and do I need one?
A. In Spain, the NIE number (Numero de Identidad de Extranjero) is a personal identity number to be used in all official, financial and fiscal dealings. All foreigners living in Spain must have an NIE number. Your solicitor will assist you with the necessary application form and any documentation required.
Q. How easy is it to get a mortgage on a Foreign property?
A. There are options available to you either through a UK Mortgage Provider or a European Bank. Normally with a Euro mortgage, the bank will lend up to 60% of the property valuation and the interest rates are lower than in the UK. We can assist/advise with regard to obtaining a Euro mortgage.
Q. Property Rental Income?
A. You can help offset the cost of financing your purchase from rental income. Typical potential income:
- 2 bedroom apartment with pool – High Season @ £350 per week, Low Season @ £150 per week
- 3 Bedroom villa with own pool – High Season @ £750 per week, Low Season @ £400 per week
Q. Schools and Education?
A. It is simple to transfer between the UK and Spanish schooling systems with full recognition of UK qualifications. Children must attend the school nearest their home in Spain. State Education in Spain is free but is only conducted in the Spanish language of course. However, whilst this does not normally present a problem for young children who tend to learn the language quite easily.
Q. Health Care?
A. The Spanish Health Service is one of the best and most modern in Europe. Spain provides free (NHS) medical treatment for all its citizens. However, non-residents can receive emergency medical treatment on either the new European Health Insurance Card (This has replaced the old-style E111). You must obtain the relevant form before traveling to Spain. All public hospitals provide emergency services on a 24-hour basis. The chemist (Farmacia), indicated by the green flashing cross displayed outside the store, can supply all your prescription and over the counter drugs. Dental treatment is not provided by the Spanish National Health Service and all treatment must be paid for.
A. Legally any foreigner can stay in Spain as a tourist for up to 90 days. Anyone staying for over 183 days is considered to be a fiscal resident (ie a resident for tax purposes) and is obliged to apply for a Residence Permit unless they meet the Residencia permit exemptions. The requirements and exemptions for EU members are continually changing to simplify the process.
Q. How are Foreign Exchange Companies able to offer better exchange rates than my High Street Bank?
A. Foreign Currency Exchange Companies buy currency in bulk from the markets at wholesale rates and hence are able to offer their clients more competitive rates of exchange. These specialist companies operate similarly to a big fish in a pond stimulating the current by buying currency in bulk and sharing the price benefit with you the customer.
Because they are dealing in much larger amounts than a single individual they can obtain the best rates and do not have to settle for the usual tourist exchange rates which High Street Banks normally offer to their clients. The difference between your High Street Bank and a Specialist Currency Provider can be translated into savings for you of several thousand euros on your foreign property purchase.