9 pitfalls to avoid before buying a house in Spain
The internet has long become the main place where people look to buy, information, advice, etc. but on the internet, you can find everything, good and bad advice, good and bad information. It is important to know what you are looking for and what is a good source of information. In this post, we explain the 9 pitfalls to avoid before buying a house in Spain.
1 – Not being ready to buy
It is crucial to make a detailed analysis of the situation of the real estate market in Spain at the time you want to make your purchase. In other words, it makes no sense to analyse the market in-depth and put off buying the property for 6-9 months, as things in this sector are very changeable and you need to seize the right opportunities spontaneously.
Coming to Spain to walk around with the estate agent and see how things are but not being ready to buy is a waste of time. Plus in this time of inflation, all prices are going up. Buying today makes you money.
In an inflationary situation, signing a purchase contract today for a new house that will be delivered to you in a year is a very good way to do business. Why? Because you are paying today’s prices for the house, not next year’s.
Recommendation: if you need a loan ask your bank if they will give you the money and by how much before you come to visit Spain. Or ask your agent for documentation from the Spanish bank.
This will allow you to be ready if you find your dream home.
2 – The Internet is very misleading
Indeed, be very careful about the different ads on the internet.
If the house is second-hand, several agencies can sell the same house (which increases the final price), and some agencies that sell resale houses lend them to each other to sell them.
In addition, they add their commission on the price, so more agents, more commission, more price.
Also bear in mind that normally photos are taken by professionals who know what you are interested in, including light, space, layout, etc…
If it’s a new build, the prices are given by the builder and are always the same for everyone. If you see an agency where the price is cheaper, it’s probably to get you hooked or simply because you forget to update the prices.
Also, the photos are normally of the show house which is normally always sold, the house you are offered is the same as the show house but next door or in the same residential area.
Recommendation: always ask for availability and updated plans.
3 – Not choosing the right loan
If you are buying in Spain and you need a mortgage you have 2 choices:
A) Or you mortgage in your country a property you have.
Advantage: the bank knows you, the loan conditions are better and you do the paperwork yourself.
B) Or you mortgage the house in Spain, the advantage, is you mortgage only the house in Spain but the conditions of the loan in Spain are less good than in your country because the Spanish banks consider you as a non-resident and the interest rates for non-residents are higher.
Recommendation, when you have signed the purchase contract, if possible come and live in Spain once the construction of the house has started and make yourself a resident in Spain before applying for the loan. Not only will this allow you to have a better interest rate but also to have control over the construction of your future home in Spain.
Click for the Sun works with an expert mortgage broker to help you choose the best mortgage in Spain.
4 – Don’t calculate your budget properly
In new construction, the prices posted on the internet are normally of the cheaper, north and middle-facing house. In general, people who buy a house in Spain want the best orientation with the most privacy possible with a pool, a solarium, and a storage room:
What do you prefer? You have to make a choice: What do you prefer? A fully equipped Renault or a Mercedes without options?
Moreover, the prices shown on the website are always without costs, without taxes, so it’s the price you pay to the seller but you have to add the costs, but what costs?
Vat 10% New Construction
Itp from resale 8% in Murcia, 10% in Alicante
ADJ tax 1.5% in Alicante, 2% in Murcia
For the notary around 1.000€ for a house of 250.000€.
Land Registry fees 350€ + or –
Lawyer’s fees 2.500€.
PIPES an Asesor or Gestor will charge you 1.000€ and do the same work.
If you are buying a second hand property, there will probably be costs or repairs to do and the vat for a repair is 21%. If you buy a new property and change it before you sign the deed it is 10%.
And you also have to calculate the monthly costs
If you buy a flat you have to pay the syndic at least 50€ per month. The land registry minimum 150€, the resident name tax that dopent or you buy but minimum 150€, consumption of electricity, water, if you have a pool the maintenance of the pool, if you rent: the cleaning costs.
5 – Believe that on the coast of Spain the size of the houses is the same as in your country
Everybody wants to be near the sea, all over the world, so the prices near the sea are higher, it’s the law of supply and demand. And everywhere the same.
Moreover, in general, the square meters displayed on the ads are built square meters and not the living meters.
In Spain and especially on the Costa Blanca coast flats are built to spend your holidays, to be at the beach, and especially in summer or spring or to spend most of the time away from home so you don’t need a big house. In the north it’s cold and you spend most of the time cooped up at home but this is not the case in the south of Spain.
Recommendation: balance your criteria.
6 – Believe that Spain has very cheap property prices
Yes, of course there are cheap houses, but if you want a nice house or flat, with good primary energy consumption, easy to maintain, and contemporary, you need some purchasing power.
But then you will feel much better.
During the crisis of 2008 everybody wanted to sell because they couldn’t pay their loans. But that is not the case today. We are in a time of inflation in all countries and it is the West that has the most advantage where people buy. And the Costa Blanca area has many advantages.
When you buy a new house in Spain it’s not just the house that you buy, but the whole thing and what you gain. The whole of Spain is its gastronomy, its culture, its temperature, its cost of living, its supermarket prices, its savoir-vivre, its sea and mountain, its golf courses, etc
7 – Wanting to do everything yourself
It’s true that Spain is in Europe and many people think that everything is the same everywhere and easy to do, but if you are not used to doing administrative procedures, or you have to go to a different place for each procedure and you don’t speak the language, it can be a nightmare. Ask for expert help from a lawyer, asesor or gestor.
Click for the sun will help you with all the steps from A to Z
8 – Believe that Spain is your home
It is true that Spain is in Europe and that European laws are the same for all Europeans, but each country has its own habits, its own schedules, its own internal rules, etc.
Spain is a very beautiful country on which you can live very well, but if you come from another country you have to get used to Spain, it’s the same everywhere.
Recommendation: come on holiday several times, find your bearings, go to Spanish shops or restaurants to see if you like it.
9 – Don’t think about the future
You will be spending your holidays or living in Spain as a family for many years, this is where your children or grandchildren will grow up and remember their holiday in Spain, home is where we go home. Beware, in Spain (especially in the south) the house is rather small because life is often outside (especially in summer and spring).
That’s why it’s important not to rush, not to concentrate too much on the present and to project yourself into the future. Ask yourself the following questions:
Will you rent the house?
Do you see yourself still living or holidaying in this house in 5 or 10 years’ time?
Does it have everything you need? If this is not all your criteria, then certainly the most important thing.
If you decide to have your children or grandchildren over, will you have enough space?
Do you have the facilities you like most?
In other words: If contact with nature is very important to you, a complex like Mar de Pulpi is for you: with its own garden, open and bright spaces overlooking the sea, and just a stone’s throw from the mountains and hiking and biking trails.
If you enjoy being in the hustle and bustle of the big city, but still want to maintain a healthy lifestyle and exercise regularly, Alicante Panoramic is the place for you: 36 houses to be built 10 minutes from Alicante city with its own private pool, space, right in the middle of nature.
Are you close to what you want to be close to?
Whether it is family, schools, hospitals, restaurants, shopping centre, supermarkets, leisure activities…
Becoming a homeowner should be a reason to be happy, and for that we think these tips will be of great help to you.