Costa Blanca Property Buyers Guide

A Guide for Buyers of Investment & Retirement Properties in Costa Blanca

Costa Blanca Property Buyers Guide

By Colin Scriven
See Colin Scriven's Bio

ARTICLE 1 - Locating a Suitable Costa Blanca Property

INDEX - Costa Blanca Buyer Guide

Costa Blanca Property | Search for property for sale in Gandia (Costa Blanca) Costa Blanca property | Search for property for sale in Denia (Costa Blanca) Costa Blanca Property | Search for property for sale in Javea (Costa Blanca) Costa Blanca Property | Search for property for sale in Moraira (Costa Blanca) Costa Blanca Property | Search for properties for sale in Calpe (Costa Blanca) Costa Blanca Property | Search for property for sale in Jalon Valley (Costa Blanca) Costa Blanca Property | Search for property for sale in Albir (Costa Blanca) Costa Blanca Property | Search for property for sale in Pego (Costa Blanca)

This article is Copyright © of Hamiltons of London SL and protected under Spanish and international law.

INDEX TO ARTICLE 1:  Locating a Suitable Costa Blanca Property.

Your first steps.

How much will it cost?

What type of property?

Searching for and viewing properties.

ARTICLE 2: Legal issues for Costa Blanca property buyers.

The NIE number

Bank accounts

Legal representation

Duties of your lawyer

ARTICLE 3. Buying your Costa Blanca property

Financing the purchase

Making an offer on a property

Formal Acceptance

Exchange of Contracts

Final completion

Registering the property

ARTICLE 4. After the Purchase of your Costa Blanca Property

Post Completion

Banks Accounts

Exchanging/Transferring your money

Insuring the property

Inheritance tax

Renting your Costa Blanca property
 

Locating a Suitable Costa Blanca Property | YOUR FIRST STEPS

I always point out to potential buyers that absolute perfection doesn’t exist, at any price, and they would need to remember that whatever tick boxes they have, they simply won’t be able to tick them all.
What they will have to take into consideration more than anything is what the property has to offer in relation to the price.

 

Choosing the Area: Before beginning your property search you will need to think long and hard on where you would like to be.

Spain is a big country and narrowing your initial search down to a particular area will save you a lot of time, money and energy.

It may mean that you will need to visit Spain a number of times before you actually decide on where you would like to settle or even stay in different areas for a while to ensure that is really where you want to be.

Spain has much to offer from the normal sandy sunny beaches of the Costa Blanca to the snow capped mountains of the interior where some of the best ski resorts can be found.

 

Choosing the Property: When choosing, make sure you do so carefully. With purchase taxes currently standing at 7% it could be an expensive mistake if you suddenly decide that the property you have purchased is not really where you wanted it to be or even the type of property you wanted.

 

Choosing your Estate Agent: It is also very important to choose your Estate Agent carefully. There are many agents out to make a quick buck and this includes some of the big name companies. If you are feeling pressured in to buying a property, stop!

Chances are you are being pushed into something you don’t really want by a clever salesman looking to close a deal so that he can collect his commission, so if they sit you down and ask you to start signing, don’t do it unless you are 100% certain in your own mind it is exactly what you are after and it is the right price.

Overall Objectives: These include prices in the area but you will also need to consider the following:

Social Factors - Where do you want to buy your home? Neighbour nationalities and factors such as parents, friends and family should be taken into consideration.

Schools - If you have children, are there any schools or nurseries nearby and are the schools/nurseries suited to your children?  

Transport services. Do you need to rely upon public transport? If so this should be an important factor when looking for your home. 

Shops, Bars and Restaurants - Do you want these within easy walking distance?

Locating a Suitable Costa Blanca Property | HOW MUCH WILL IT COST?

You will need to work out exactly what you can afford to spend when buying a property in Costa Blanca and you should bear in mind the following extra costs:                          

New Costa Blanca Property: IVA (V.A.T.) – 7% of property purchase price based on the developer’s invoice plus 1% documentation tax.

Resale Costa Blanca Property: 6% Transfer Tax plus 1% documentation tax.

Additionally for both New and Resale Property:

Notary Fees – approx €650.00.

Land Registry – approx €250.00.

Legal Fees – Around 1%.

Generally, if you allow 10% of the purchase price for costs, you should be covering all your expenses unless something out of the ordinary crops up.
*Please note that the above costs are a guideline only and you should check with you solicitor for exact costs prior to purchasing

Regarding IVA: The IVA on a new building is 7% but any additions, pool, garage, garden walls etc. are taxed at 16%. Bearing in mind, that when these works are written onto the escritura (Declaracion de Obra Nueva) there are more Notary and Registry fees, it would make sense to get all of this done at the beginning – if you can afford it.

Regarding the amount declared on the Title Deed: It has been a practice in the past to under-declare in order to pay less transfer tax (buyer) and less capital gains tax (seller). The taxman is obviously not happy with this and things are changing.

Many resale properties do not have all of the new works declared (Declaracion de Obra Nueva – Declaration of New Works) but currently there is an “unofficial amnesty” on this in the respect that the Town Hall cannot proceed, with fines or a demolition order for building illegally.

Consequently many of these problems are easily resolved with an architects description of the full extent of the property certifying that all of the works were carried out more than 4 years ago.
This in turn makes it possible to do the Declaration of New Works, without a building license or invoice from the builder and payment of the 1% documents tax only. The value declared on the title deed is raised and the capital gains tax reduced for the seller.
Quite possibly this is just a temporary arrangement in order the regularise the situation, the facility will eventually be removed and stricter rulers will apply to the amount declared.

Locating a Suitable Costa Blanca Property | SUITABILITY

Now that you have decided on your location and your purchase price, it is time to choose your property.

The next decision is on what type of property you are looking for. Obviously the price you can afford will have a big bearing on property type and style but here are some examples of property types you could be looking at -

Apartments and "Pueblo-Style Properties"  When located in or close to the town centre, these are usually in a purpose built block and quite often come with a communal pool and gardens.
Out of town there are a variety of configurations: low-rise blocks, stepped down a hillside, terraced, semi-detached or even detached. Sometimes they have a small private garden, some even have room for a small private pool.
You will normally be required to pay a community charge per annum for the upkeep of these and/or the maintenance of the block.

Townhouses: These can vary in design and style. For instance, you can choose between a typical Spanish Town House, usually quite old and in the centre of town, or there are the new style of town house which are two or three storey properties, often with their own small garden.
Many newer town houses quite often have a communal pool for which you will have to pay a community charge.

Villas: A Villa can be detached or semi-detached with private garden and most have a pool or room for a pool.
Villas can be located anywhere except for city or town centres and can be found on urbanisations or in the country, on the coast or inland.

Fincas: Think of a farm house in the U.K. and you will be thinking of a Finca and they usually come with a good piece of land.
Usually found in more rural areas so transport will be necessary, and you will need to check that utilities are available prior to your purchase.
Once upon a time, many of these needed restoration but over the years most of these have already been restored to a high standard, especially around the coastal areas and surrounding countryside so if you want something to renovate for yourselves you may have to look inland a bit further.

Your choice will quite often depend on your own circumstances of course and will involve decisions such as whether the property is an investment (location and values will be important), holiday home (do you want to be on the coast) or permanent relocation (do you have a young family, will they need schools and do you need to be close to amenities?).

Locating a Suitable Costa Blanca Property | SEARCHING

Whatever you do, make sure that you have a good list of properties ready to view prior to coming to Spain. This will save a lot of time and effort for you and your agent, and will mean that if you have a full itinerary before you arrive, you will be able to view more properties in the time you have allocated.

When viewing properties several questions need to be taken into consideration. Don’t make any impulsive decisions or be pressured into buying by your agent. Go back as often as you want until you are completely happy with your choice, and then you’re ready to begin the process.

Author’s Bio 

Colin Scriven has worked as an estate agent for 17 years, the past 5½ years of which have been in Spain. Currently he is the General Manager of Hamiltons of London SL with 4 offices covering the Costa Blanca North area, from Benidorm to Gandia (Costa de Azahar), with headquarters in Jalon.
Colin lives near Denia and has two young children who attend local Spanish School.

Buying or selling Costa Blanca property? – Consult Hamiltons of London, the Costa Blanca estate agents, with over 2,000 properties listed, and offices & affiliates in all Costa Blanca areas.
Hamiltons Homepage for Properties for Sales in Costa Blanca or the Costa Blanca area offices for -
Albir Properties | Calpe Properties | Denia Properties | Gandia Properties | Jalon Properties | Javea Properties | Moraira Properties | Pego Properties