Advice on buying Marbella property

We are aware that buying a property is an important decision, especially if we are adventuring ourselves into a new destiny where we are not familiarized with the purchase procedures, legal aspects, community regimens, and all the matters involved not only in the purchase itself, but also in the subsequent occupation and use of it. There is obviously no substitute to visiting the area and having a personal discussion with a professional on all these matters. As a preparation to this work, we have issued a brief list of some aspects to be considered and that we think could be useful at this stage..<up>

Look for a suitable property

When looking for a suitable property, take into account the final use, as the items to consider are very different if you a looking for a holiday place, a permanent residence, or a mere investment.
Have a first general insight of the area, to know all the different locations that Marbella offers (golf, sea, close to amenities). Marbella is la lot larger than it seems!
Try to understand if it is a good investment on a resale standpoint.
Take your time to look at several options and thus be able to make a decision with which you will be satisfied. However, don't get exhausted looking at each and every property available. Make sure a professional understands your requirements and makes a good and representative selection to look at.
The chances that you will find a property that meets 100% your requirements is very difficult, you will therefore have to decide in which aspects you are ready to compromise.
Although it is important to take all these elements into consideration, pay attention to your first impression of a place, sometimes we fall in love with places that have nothing to do with our original idea or with the advantages we had studied!

Negotiate an Offer

Once you have decided on a property, find out if there is a possibility to put an offer, and to conclude a deal with all the necessary guarantees.
When submitting an offer to the owner, make it as complete as possible, indicating as well when you would be ready to sign a contract, pay a deposit and the time you need to complete. This will show the owner that your offer is genuine and that you are not only intending to find out which is his bottom price.
Let the agent who has introduced you to the property, negotiate all the details with the owner, this is his job.

Closing a Deal.

Once an agreement is reached between both parties, the general procedure is to go into a contract stage where all the terms agreed are confirmed, a period of time is established to go to the Notary to sign the final title deeds (which is approximately 30 days) and 10% of the price agreed is paid as a deposit. At this stage it is recommended to let a lawyer participate to ensure that all the legal aspects are covered, especially if you have decided on a new development under construction, where the percentage of risk is higher. The lawyer will make sure that the contract covers all possible situations during the construction.
Work in collaboration with your agent to define all the conditions of the agreement.
If you need financing, most of the local banks are offering mortgages to non-residents, up to at least 50% of the appraisal value of the property.
Once the contract expires, the final title deeds will be signed in front of a Public Notary, and the balance of the price will be paid to the owner. The new ownership will be then registered in the Land Registry Office. At this moment you will receive the keys to the property and take possession of it.

Closing Costs

The selling prices of property do not include the closing costs, which are the following:

Transfer Tax: this tax is applied to resale properties (villas, apartments, plots or commercial premises) and constitutes a 7% of the property value. This tax is paid by the purchaser.
V.A.T: applicable to properties owned by promoters, or companies dedicated to the sale of properties. It represents 7% of the value for villas, townhouses, apartments, or garages that are sold as an annex to the property. For plots, commercial premises, independent garage spaces, is of 16%. In both cases you will also have to pay 1% for stamp duty.
In Marbella it is common practice that the purchaser pays for the Notary's fees, although the Law indicates that the vendor pays for the part corresponding to the the issuing of the transfer deed and the purchaser pays for the second and further copies of the deed. The Land Registry fees or registry expenses are paid by the purchaser, as he is the person interested in registering his title.
The Municipal Plus Valia Tax, which is tax levied on the increase of the value of urban Land by the Town Hall, is paid by the vendor, but in many cases both parties include the payment of this tax as part of the negotiation process.
Lawyers fees. <up>

Maintenance costs of the property

Local (Town Hall) Real Estate Tax (IBI): This tax is based on the catastral value and each Municipal Authority sets a tax rate to this value. This tax is paid once a year.
Income Tax: A non-resident with a property in Spain for his own use is liable to pay income tax. The Tax Authority bases the annual income as a 2% of the catastral value of the property, and a flat rate of 25% is imposed on that income.
Wealth Tax: The wealth tax is based on the highest of these three values of the property: catastral value, value assessed for other taxes, or title deed value.
Community fees: are based on the square meters of the property and the percentage of participation in the common areas.
Payment of expenses pertaining to the use of the property such as electricity, water, telephone, gardener, insurance, security, etc. <up>

If you have bought a property within a Community of Owners, you will have to be informed on the bylaws and regulations under which the community is run. You should also be aware that there is an Annual Meeting to discuss all the issues related to the community and the approval of the corresponding budget to run it.
If you have bought a property under construction, you should make sure that once the works are completed, the corresponding occupation licence is issued by the Town Hall. You must also know that there is a ten-year guarantee from the builder for any new construction.
At Alhambra we can help you organise all you would need to settle in your new home, such as decoration, installations, fittings or even renovation works if needed, to put the property in prime condition.
We can also help you to contract any type or service or insurances.. <up>