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This document is a simple reference guide on the buying and selling process in Spain.

In no way does this cover all of the legal aspects.

1. Choose the property you want to buy.

2. Once you have chosen the property, verbal negotiation begins . The Agent will pass on the Buyer's offer to the Seller.

3. After negotiation ends and the Purchase price has been agreed between the Seller and the Buyer, a Private Contract is made between the two parties, where the buyer must make a Reserve Deposit. As a general rule, the Deposit will be 10% of the agreed Purchase price, so the property is frozen (removed from the market) which prevents any other buyer from buying the property or any changes to the purchase price. The Private Contract (Deposit Agreement) contains the written terms of the Purchase; the agreed price, the amount of Reserve Deposit paid, the remaining balance, and the date for the signing of the Deeds and other important details. Normally the deadline is 45 days to sign the Deeds. This document is a valid contract between the Seller and the Buyer, which commits them to carrying out the Purchase; if the Buyer fails to comply with the terms of the contract they will forfeit the Reserve Deposit. In the case of the Seller not meeting the terms of the contract, they must pay double the Reserve Deposit received by way of compensation.

4. Attached to the Deeds will be a 'land registry extract' (which identifies the owner of the property and confirms that the property is free of charges, mortgages and tenants).

5. Meanwhile it will be ensured that all documentation is in order and complete, in the sense that the documentation of the Seller is in order and that the property is being sold free of fines, mortgages, tenants, and any other payments to the DIA (IBI, community, garbage, water and electricity).

6. The next step will be at the local Notary where the Seller and the Buyer sign the Deeds. At this time all of the documentation has been verified and the Notary will ensure that the information is in accordance with Spanish law. The Seller and the Buyer must both sign the Deeds. At this time the rest of the agreed price of the property is paid and the Seller hands over the keys of the property, transferring ownership to the Buyer.

Expenses and Taxes

No matter where in the world a property is purchased, there are always costs arising from the Purchase.

In Spain, as a general rule, the total expenditure does not exceed 12% of the Purchase Price of the property.

• Legal expenses; usually 2% of the Purchase Price, plus 10% VAT.

• Notary costs; fixed by law, depending on the declared value of the property, ranging from € 300 to € 900.

• Registration fees; approximately 45% of the costs of the Notary .

• Transfer Tax; when a property is purchased for resale the property tax sale is 8%; when a property is purchased directly from the developer, the tax rate will be 10% Sale Tax plus Documented Legal Acts (IAJD) which is 0.5%.

• Capital Gains; this tax is payable to the municipality based on the formal evaluation of cadastral value of the property whenever there is a change of ownership (i.e., each time the property is sold). The amount may vary depending on the age of the previous Deeds and can be confirmed at the Town Hall.

All taxes and expenses listed above, with the exception of the Capital Gains Tax, are charged to the Buyer.