Part 4 : buying a Spanish property
My experience . . .
In this final part of my personal experience of buying a Spanish home I plan to cover the practical issues that I encountered as well as highlight some of the pitfalls that await the unprepared.
You are bound to have heard all the scare stories about buying a property in Spain, just as we did when we were looking for something back in 2005 that we could afford.
It would have been easy for us to chicken out at an early stage and given in to the perfectly natural fear of getting it wrong and losing our money. Had we listened to that nagging inner voice that kept reminding us that at ‘our age’ perhaps it wasn’t the wisest thing to do with our life savings, we would have missed all the wonderful life experiences and rewards that have been ours in such a fantastic country for almost 10 years.
Just starting the search is enough to give you the heebie-jeebies as the news and warnings come thick and fast. Just to name a few you are bound to see the many rumours of corrupt town officials; the selling of bogus planning permissions and the illegal building of properties to overstretched construction companies.
Once you start delving deeper it feels as though every expat out there has unknowingly bought an illegally built Spanish property or suffered from ‘land grab’ and all the spiralling costs that this entails, and of course sadly for some very unfortunate people this is true, and my heart goes out to them. You can still see illegal unfinished buildings scattered over the countryside.
In fact once you start seriously looking at property you begin to feel that you must be absolutely crazy to even contemplate handing over your hard earned cash to someone you don’t know, in a country that is foreign to you, but please don’t give up your dream of owning a property in Spain at this stage. It’s worth hanging in there.
Owning a property in Spain will open your eyes to a new culture in a beautiful country, which is justifiably famous for its superb quality of life and friendly people.
You will have untold and unexpected pleasures awaiting you at the end of your dream, but don’t turn that dream into a nightmare by rushing into buying without first making sure you know what you are doing and are familiar with the Spanish way to buy property.
As in any country it’s a case of buyer beware and at the start the biggest thing that you can arm yourself with is knowledge.
The fiscal fraud trap awaiting the unwary -
There’s a fiscal fraud that exists in Spain and although it is very much on the decline it is still out there and waiting for the unwary. Try to avoid it if possible but if you really must have that dream house that you have found you might be asked to pay in cash and ‘under the table’ some of the asking price (perhaps around 5 to 10%) without it being declared in the house deeds. It is a fraud that mainly benefits the vendor whilst the potential liabilities, mainly tax, accrue to the buyer.
We have friends who became involved in this ‘undeclared’ fraud. They were asked to turn up at the Lawyer’s office with shed-loads of euros in a black sack, so try not to get into this position and do take the advice of a reputable solicitor before making any decision. We were never involved in this type of conversation when we bought our house so I’ve no direct experience that I can pass on.
The purchaser’s liability for unpaid debts on a property -
In Spain unfortunately any debts made by the current owner relating to a property are transferred to the buyer when it is sold. So the buyer could be facing an unknown payment of debt that they did not personally incur. Manuel Martin a Spanish lawyer who writes a weekly column in the ‘Costa News’ newspaper and practises law in the Denia, Calpe, Benidorm and Torrevieja areas as well as the UK advises buyers to make sure that their solicitor checks whether there are any debts outstanding on the property. He goes on to say that sometimes a solicitor may also withhold from the purchase price an amount of money which would be enough to cover possible debts.
Our story -
We bought our Spanish property after viewing quite a lot of properties with many different estate agents in various parts of Spain. In fact every holiday we would spend a large part of it just property hunting. All this experience was good and we began to build up a picture of exactly what we wanted and the pitfalls to avoid.
We quickly learned that the best way to test whether the estate agent was telling us the truth was if possible to check it out for ourselves. Return to the property without the estate agent, ask people living nearby the burning issues that bother you.
For example you might want to know whether the local ‘pub’ is noisy well into the wee small hours — actually that would be an easy and maybe pleasant one to find out :-) We wanted a garden that faced the sun for the majority of the day. By revisiting just as the sun was going down soon told us whether the estate agent had told us a porky or not.
Wall to wall sunshine doesn't suit all Brits because it can get hot — very hot — but hey the house we liked also has a small back garden in the shade and we bought several huge sun umbrellas plus and the house came with a shady undercover ‘naya’ area in the corner of the sun-drenched part of the garden. It’s what we wanted and we’re happy with it.
The house we eventually bought was in need of a lot of TLC (I hope the previous owners are not reading this!). They were lovely people but had lived there ‘man and boy’ or so it seemed and had never refitted or attempted to update the original kitchen, bathroom, etc. In fact all was clean and on the whole in good repair but it had fallen out of the ark and many of the utilities were way out of date. Our first job was to replace the drafty, single glazed windows and buy a new boiler.
One plus was that the house we liked had never been a rental property so the quality of woodwork, marble floors, etc was good. It’s surprising how little respect renters have for property and we saw many houses that would have needed total refurbishment. The number of cracked sinks or baths we saw isn’t even worth a mention and in one property they must have practised kickboxing wearing steel toe cap boots against all the wooden doors. Of course in some cases these things don’t matter if you are happy to put things right and the property selling price reflects this.
Looking back we did something that was foolish and yes, we should have known better, after all we had read all the warning articles, but I hold my hand up, sometimes there’s no accounting for human stupidity.
We knew that to appoint an estate agent’s in-house solicitor to undertake the legal processes was not the best way to do things, but inexplicably we trusted the estate agent and his solicitor who also happened to be his sister. They were such lovely Spanish people who had inherited the family business and it was obvious that they worked very hard to maintain it as a solid, trustworthy business.
He had told us the truth throughout, and the elderly people from whom we were buying this property adored him, trusted him and had bought the property from this family concern 30 years previously.
Would I do this again? With him probably the answer would be yes, otherwise I think it would be a no. We had met some very dodgy agents.
Despite all the scare stories we were lucky, we found the house that we wanted and could afford although we knew its refurbishment would take several years as we gradually found the money to do it. Our offer price was accepted and both parties (vendor and buyer) paid an agreed percentage of the house price to a third party. If either of us backed out at this point then the other party involved would receive their money. This gave both sides peace of mind.
In due course we paid the full amount and in front of a senior Abagado (lawyer) we (the ‘we’ being both vendor and buyer) signed various documents I’m afraid this meeting took place entirely in the Spanish language and my futile Spanish mutterings that could successfully get me a glass of wine or a nice cold beer didn’t help one iota. There also wasn’t a single black sack in sight!
Owning our own Spanish property has opened up a new, wonderful life for us that we had no idea existed. It is nothing like being on holiday; it is a hundred times more rewarding. We live there on and off for about five or six months of the year and during this time have become part of a community. We now have lovely friends of many nationalities and our experience of their cultures has enriched our lives at the same time.
I’ve given you my honest view of buying in Spain, for after all what could be better than enjoying time in a country with a wonderfully benign climate, tolerant and friendly people, plus an al fresco life that lasts almost all year round.
Please do your research first though. It’s the most important part of getting a smooth passage. I have added a few links at the bottom to get you started or don’t be afraid to get in touch with me, if I can help you I will.
Buying Property in Spain: Risks and Rewards. For many aspiring expats buying a property in Spain represents a dream that will provide them with either the perfect holiday home or a new life in a country justifiably famous for its superb quality of life. http://www.spanishpropertyinsight.com/buying-property-in-spain/buying-a-resale-property/
Laws and taxes for British nationals who want to buy or let property in Spain https://www.gov.uk/how-to-buy-property-in-spain
‘The Complete Guide to Buying a Property in Spain’ by Anthony Foster This comprehensive book clearly sets out the essential and useful things to know if you’re considering owning a Spanish property.