How to Choose a Property in Spain

If you are a resident of Spain and intend to purchase a property here then you need to know how you can register it and what taxes are applicable. Since 1st January 1995 registration of any property bought in Spain has been made mandatory, whether it is a home or a plot. The official form for registration is called Modelo 902 and it can be obtained from the local tax office. If it is an independent property then the buyer needs to declare the property for the purpose of registration and if it is a part of a society then the promoter or builder needs to submit the application.

You can make your choice of property especially a home based on whether you want an apartment, a semi detached bungalow, a private villa or a farm house far off from the city. An apartment will definitely be easy to maintain but will not give you the privacy you wish to have. A semi detached bungalow will definitely offer more privacy, less interference but more maintenance cost too. The same is true of an individual villa, but the risk of being broken into is definitely higher. A farm house will have lesser price as well as maintenance costs, but you might have to learn a little Spanish.

If you have the plan of buying a plot then the first aspect to check and verify is whether you can construct something on it or not. You might end up in a soup if the area or plot you chose is found to be in a location of prohibition or with no planning permission.

Suppose you are not equipped with the desired amount to pay for the home you have chosen then you could go in for a home mortgage in Spain. Most of the banks in Spain currently provide mortgages of 60-80% of the price of the property for 5, 10, 15 or even 20 years. The terms and conditions differ for the residents and non-residents. Some banks do provide 100% too! The existing variable rate is 4.7%. Even non-residents can buy a property in Spain and in fact many of them are already doing so. This is because of the low interests on properties in Spain as well as other benefits such as write off clauses, no commissions from the banks and so on.

Non-residents are also free to open their bank accounts for the purpose of home mortgage. If you are a non-resident then you would need a passport or a residence permit to apply for home mortgage. Since non-resident buying is on the rise, several commercial banks in Spain are taking advantage of it and specifically targeting more and more non Spanish people to buy properties in Spain. This is a win-win situation where both parties tend to gain. As foreigners are free to buy property they also have the option of buying state-subsidized dwellings that are on sale in Spain. There is a condition here though, that a foreigner should either be a resident of Spain or should strongly intend to be one in the near future. There are some limitations conce
ing their income and family conditions also.