Is it difficult to buy a holiday home in Mallorca???
The answer to that is simply "NO, it is not !!!" Neither it is difficult to buy a property or business to settle down in Mallorca!
However, we do recommend you to contact a good lawyer who deals with the purchase issues. If you wish us to assist you in chosing a lawyer who speaks your language.(English, German or Swedish), we would be delighted to!
If you have decided to purchase a property in Mallorca, ask your lawyer to request a NIE-number (it is a Spanish Tax Identification-number) for you if you are a non-resident in Spain.
This procedure can take between 30 and 60
days and must be presented at the final signing of the deeds!
When you have found the property you wish to buy, the procedure is as follows:
1.
Make an offer. You might wish to get an induvidual valuation so that you know that the purchase price matches the market price.
2.
If you are not paying in euros, agree what currency will suit both parties.
3.
Normally an options-contract is signed by the vendor and the buyer and a deposit of 10% of the agreed purchase-price is paid.
This can be paid either to the lawyer who will keep it in a client-account, or it can be paid directly to the vendor. If the buyers need special financial
assistance (such as a mortgage), a future signing date will be agreed on. Make sure you understand all the issues in the options-contract and that it specifies
exactly what will be included in the sale (furniture, fittings, etc.).
4.
When this contract has been signed by both parties the property is taken off the market.
5.
Meanwhile the lawyer will have requested a copy from the property-registry to check the ownership of the property is in order and to see if the property has any debts on it.
6.
Should the buyer not be able to fulfill their agreement before or on the due date of the options-contract, the vendor keeps the 10% deposit ( if not agreed otherwise).
However, should, for some reason, the vendor fail to keep his side of the contract and not sell the property to the buyer before or on agreed date, the vendor must pay to the buyer the double amount already paid as deposit.
7.
The final signing of the deeds (in Spanish “la Escritura”) is always signed at a Spanish Notary´s office. Normally the byers will have a “copia simple” of the new deeds within a few days after signing and the official deeds are normally delivered 3-6 months later.
MORTGAGES IN SPAIN:
The following documentation is required by a Majorcan bank:
•
Copy of passport (-s)
•
Copy of your P-60 form (if you are employed)
•
Last 3-6 months payslips
•
Proof of any other income (pension-fund, life-insurance, other investments)
•
Last six months statements plus a bank reference from current bank
•
If you are renting a property, the last 3 months paying in slips
•
If employed, a reference from the employer
•
If you have a mortgage with another bank, full details of repayment-scheme.
•
Copy of the title-deedsof the property you wish to purchase
If you are a self-employed or a limited company, copies of the last 3 years audited accounts must be presented,
as well as a certificate from the accountant confirming salary/dividends/net profit figures for the last 2 years. A copy of your last tax-return must also be presented.
Please remember that the more you can show of earnings, the higher porcentage the bank can offer you. Normally a non-resident will be offered between 60-80% of the official
valuation amount and a resident will be offered between 80-100%, depending on age and earnings.
If you are granted a mortgage, a bank account will be opened and a valuation
will take place. Normally the banks work with official valuation-companies. The valuation and the calculation should not take more than a week.
COSTS WHEN BUYING PROPERTY IN SPAIN
If you are purchasing through a real estate agents, their fee is generally paid by the seller.
The property transfer-tax is 7% (when purchasing
a new-built apartment or villa or a re-sale.
There is also another legal acts stamp-duty of 1% of the value of the property.
Furthermore, it is not unusual in Mallorca
that the seller pays the “plus valía” (capital gains tax) of the vendor. Make sure you discuss this with your lawyer!
A valuation normally costs
The charges for
the notary and the property-registry are also to be paid by the buyer.
All in all the charges are approximately 10-12% of the value of the property.
Running costs:
Annual property tax (IBI) and garbage-collection (basura): Paid yearly to the town hall.Each town-hall have their own tax-laws.
Income-tax and wealth-tax: A resident, as well as
a non resident, property holder in Spain pays income/wealth tax.
Non resident:
Resident:
If you live in a community with pool, etc. there will be a monthly/quarterly
or yearly charge to be paid, please ask the president of the community for more information.
