The real estate market in Spain tempts both those who dream of living in the south of the EU and those seeking a secure way to invest capital. Before you buy a property, familiarize yourself with the rights and obligations that local law imposes on owners.
Before Buying Property on the Costa del Sol in Spain
When planning an investment in an apartment on the Spanish coast – whether for personal use or rental – it is worth choosing offers from experienced real estate agencies. Specialists are well-versed in all legal aspects related to buying an apartment or house in Spain. They will advise you on obtaining a mortgage from a Spanish bank and guide you through a series of formalities – from the reservation agreement to the transfer of ownership. This allows you to purchase property without perfect knowledge of the Spanish language, relying on experts in Spanish real estate for every aspect, including rental management or property upkeep.
These Obligations Apply to Property Owners in Spain
You must budget for various fees. A bank can finance up to 70% of the property’s value. The remaining balance, along with additional costs, must be covered by your own funds.
Once the deed is signed, you have 30 days to pay the AJD (Transfer Tax). New properties in Spain are subject to IVA, the Spanish equivalent of VAT, currently at 10% of the property value. You will also need to pay a notary fee (amounting to approx. 1.2% of the property value) and a registration fee (the amount depends on the property’s price). All these initial fees will amount to approximately 13% of the property’s value.
You will also incur ongoing costs, such as the IBI property tax, an annual tax calculated based on the cadastral value of the property. It is also your responsibility to pay community fees, utilities, waste collection, etc., on time.
Property Owner Obligations Towards Tenants in Spain
Investors planning to buy and rent out properties in Spain should also be aware of their obligations towards tenants.
A well-drafted rental agreement is crucial. It should specify the lease term, the scope of permitted alterations, and the payment amounts. It protects both parties from potential issues.
For both short-term and long-term rentals, you must ensure the property is in appropriate condition. This requires the owner’s commitment to property maintenance. Prompt repairs and responsiveness to tenant requests are necessary. However, you don’t need to be physically present. By engaging a real estate agency, you can entrust these tasks to specialists.
The Housing Market and Spanish Law
Do you need your own business to rent out properties in Spain? No! In Spain, you can own up to 5 properties (including your primary residence). From the 6th property onwards, you must register as a business entity.
It is also worth knowing that if a buyer intends to offer short-term rentals, they must obtain a tourist license. Long-term rentals involve significantly fewer formalities.
Experts in Spanish Real Estate Investments
When looking to buy property in Spain, it is essential to thoroughly analyze the market. Engaging experienced advisors, such as the experts at International Investment Marbella, is key.
With over 20 years of experience in the Spanish real estate market, combined with fluent Spanish and English language skills, they offer professional client service, comprehensive advice, and an individual approach to client needs. The specialists at International Investment Marbella guide clients through the entire purchase process, assisting with finding the ideal property, obtaining a mortgage from a Spanish bank, and more.
The oldest Polish real estate agency on the Costa del Sol also provides comprehensive post-sale support. This includes interior design, moving assistance, property management in the owner’s absence, rental management, and client acquisition. Contact us to learn more. We also invite you to follow us on social media: Facebook, Instagram, Linkedin, Tik Tok, and YouTube.