Tuesday, 25 February 2014

Why do I need a Spanish Lawyer when buying in Spain

The importance of legal advice in Spain

Most of the horror stories reported in the press could of been avoided with expert and sound legal advice from a Spanish Lawyer.

Spain has well defined regulations applicable to all property in Spain both at a national and a local level. As long as the correct process is followed and detailed checks undertaken you should not experience any future issues.

The key issue when undertaking conveyance on a purchase in Spain is that the relevant information and checks that need to take place cannot be done with one authority or office.

What types of issues should be looked out for


Over builds or extensions to the property that do not have the correct permissions are one of the major types of infractions that affect property in Spain. Due to past lax implementation of regulations or an ignoring of the legal process a number of properties in Spain have historic issues relating to the number of meters seen and that registered at land registry.

Only square meters registered at land registry and registered as living accommodation can be deemed to be completely legal.

Catastral values and purchase taxes

It should always be checked that the price you are paying for the property is not below the Catastral value and if it is that advice taken as to what possible tax implications this may have. Paying below the Catastral value may incur future purchase taxes as the tax authorities work off minimum catastral values.

Embargos and Liens

Outstanding embargos and debts can remain with the property in Spain and be inherited by you unless the debts are cleared and registered as cleared before completion. It is important a full check with all utility companies, local authorities, communities and tax offices are undertaken during the legal searches.

Spanish mortgages are cleared on day of completion and a representative of the Bank must attend completion to remove the loan.

First occupation licences

All property built in the last few years must hold an occupation licence. A few properties will not have the certificate because outstanding fines must be paid before the certificate is issued, but the property itself does fall into current planning regulations. At all times if an occupation licence is not available caution should be taken.

10 year building warranties

All properties 10 years old or less should hold a 10 year building warranty which protects you against build issues during the first 10 years.

Read the full article : Spanish Lawyers and their function in the buying process

Tuesday, 18 February 2014

January house values in Spain

TINSA one of Spain’s largest Valuation companies report on the evolution of house prices in Spain on the second Tuesday of each Month.

January 2013 house price data

Whilst the data is taken from a small pool of valued properties within the month the TINSA report is a good general indication of what is happening to prices of residential properties across Spain.
January showed another month of declines per meter squared across all regions but the decline has slowed significantly from where we were a year ago.

Which regions of Spain showed the smallest sale price declines

Coastal areas and the Islands of the Balearics and the Canaries held up better than the Metropolitan and City areas.

In support of this information on prices, in the region of Malaga house sales were made up of 35% of foreign buyers in comparison to 17% when looking at a national figure.

There is both tangible and anecdotal evidence that those buying in Spain from the international markets is increasing and that this is having a positive effect on both number of sales made and the sale price which can be achieved.

Can we expect an upturn in prices 

Whilst asking prices are not being met, for those selling in Spain willing to accept realistic offers property is starting to move again.

Prices per square meter are now below levels of 2004 and knocking on the door of 2003 and 2002 prices.

We may see small but steady growth in prices toward the back end of 2014 and a stabilization of prices in the first 6 months.

Read the full article : Spanish house price index


Thursday, 13 February 2014

Sales of property in Spain for December 2013

The monthly data from the National Statistic office was released yesterday for the transfer of property rights in Spain.

Data showed a small decline in sales from December 2012 to December 2013
This decrease was not unexpected and was in fact much smaller than was anticipated. 

The decline was due in a large part to the abnormally high amount of completions in December 2012 in comparison to the rest of 2012 as buyers brought forward buying in Spain to beat the ending of tax incentives which were removed in January 2013.

Were there positives to be taken from the Data

Yes. Firstly the overall transfer of property rights fell by only 0.50% in the month whilst residential sales were down 3.6%. This means the sale of commercial property held up quite well in the month indicating the underlying economy may be recovering.

The second and possibly most valid point was that for the first time in 5 years the variation between sales in November to December, whilst traditionally always lower at absolute levels, showed a positive trend meaning the overall decline in sales stabilized in the month.

What challenges remain

Whilst there has been much more positive news in the last few weeks with, small increases in sale prices being announced, Spanish mortgages more readily available again and generally higher levels of activity and a mood of optimism creeping in, it will be a long haul back to normal market conditions.

The challenges that remain in place are the level of bank repossessions, which was the only area of increases in 2013, the overall economic recovery and the continuing uncertainty many feel when looking at Spanish property as an investment due to past perceived issues on legal protection when buying in Spain.

It would appear however that we may now be at, or very near to the bottom of the cycle and that 2014 will see slow but sustained growth in the sale of Spanish properties.