The process of buying a property in Spain involves several, often quite complicated formalities. This is why in July of this year we presented a seminar on the process of buying a VAPF home. It is part of our series of webinars.
We have already explained the first steps in buying a VAPF home off plan. In this webinar, we are assisted by the law firm Fuster & Associates who are experts in the field. They have over 20 years’ experience as specialists in the property market. The firm has offices in the Alicante region in Teulada. finestrat and Orihuela. And also in los Alcázares in Murcia province.
In this second part of the webinar, we mention the final step in the purchasing process and some other important aspects you need to consider.
Final step in the process of buying a VAPF home
One of the most vital requirements for VAPF is that their clients’ payments are secure. Normally, developers must provide a bank guarantee for all clients’ payments, but not all do this. That is why we ask our clients to pay through our client fiduciary account. Once we have received the money, we ask the developer for a bank guarantee and as soon as we receive it we make the payment.
Once the home is completed, a meeting is arranged with the notary. There, all the details of title to the property will be checked and payment is then completed.
And after purchase?
VAPF’s legal and tax advice and management service doesn’t end with purchase of the house. There are also several fees that the client must pay when buying a Spanish property. This is why we always recommend that our clients increase their spending budget for the house by about 12% to 14%. This will enable you to cover all the extra fees and costs. One cost that you will incur when buying a home in Spain is payment of Value Added Tax (VAT). There are also other costs, including notary’s and registry fees or tariffs. VAPF will handle all these payments for you to ensure that everything is paid for and settled.
Another fee that is payable after you have bought a home in Spain, is the Non-resident Tax. The amount is based on the property registry value and payment must be made annually. This is another formality that VAPF will deal with for you.
Finally, at VAPF we recommend that our clients make a will in Spain once they have bought their property. In this way if anything happens, it will be much easier for your heirs to manage everything at what is always a difficult time.
Buy to rent investmentl
Many of our clients buy a VAPF property as an investment. That is, before they retire completely and move to the Costa Blanca they will rent out their home. In this case, there are some legal and tax requirements. In the case of European citizens, an obligatory quarterly monthly tax statement must be filed. However, tax is only payable if you make a profit from your rental. The reason is that the landlord’s other costs are taken into account, such as electricity or water.
Buying through a company
Instead of buying a property in their own name, some of our clients purchase in the name of their company. This is a viable and feasible option but the purchasing process requires a few formalities to be completed at the start.
The first formal requirement is for all the CEOs and managers of the company to sign a declaration of ownership. They have to authorise power of attorney in a document signed both in Spanish and in your language.
The next step for a client wishing to buy a VAPF property in their company name is to obtain a certificate. This certificate contains information confirming that the company is still operating. For example, the official address for tax purposes. This document will also be signed in both languages and after certification by the notary it will be delivered to VAPF. The following step in this process is the same as a buying a property in the proprietor’s name .
As you can see, at VAPF we try to make the process of buying a property easy for our clients. If you have any queries, you can write to us directly, using this form. And if you want to learn all about VAPF and our villas and apartments, you can follow us on Facebook and Instagram.