Sellling Your Property In Spain
Please note that the information provided in this article is of a general interest nature and intended as a basic outline only
. You are well advised to contact a professional for advice specific to your circumstances. Nothing contained in this article should be seen or taken as the writer or the publisher providing legal or financial advice.
I have discovered an excellent cobbler's shop in Old Town Marbella. Jose skill and artistry with leather are exceptional and his soling and heeling are brilliant and above all very reasonable.
High on the shelf above the polishing wheels and strange smelling glues are two pairs of beautiful English shoes gathering a deepening layer of dust. Jose tells me that these fine shoes are the property of one Juan Antonio Roca Nicols - the now disgraced planning chief of Marbella.
They have sat there since S. Roca's detention nearly four years ago as part of the Operacion Malaya mounted by Central and local government in Madrid and Seville to clean up the Costa del Sol's act. In part the action was aimed at restoring confidence to the property and tourism sectors that had been damaged - though certainly not beyond repair - by the excesses of the latter years of the Gil administration in Marbella.
If you read the back of any repair ticket issued by any cobbler from Birmingham to Bombay you'll see that there is usually a three to six months window after which unclaimed shoes can be sold to recover the costs of their repair.
When questioned as to why he has not put these shoes on Ebay.es - the local Spanish version of the Internet auction house phenomena - Jose laughs as if to say that their current owner will soon return to claim his shoes. This reluctant owner of what is prosaically called in English law "an unpaid seller's lien" acquires good title under contract from the owner of the shoes to enable them to make a sale to a third party. In S. Roca's case, I suspect few would willingly step into his shoes ... perhaps worse for Jose I suspect he'll be waiting a while longer for S. Roca to redeem his shoes. On current form - as the Spanish government ensure that the book is thrown at him for his crimes of excess - a reasonable estimate has got to be a further five years.
In January this year, after many months of gestation - passing ping pong like between Marbella's Town Hall and the Junta de Andaluca in Seville, a new PGOU (Urban Plan) was approved. To the greatest extent this new Plan draws a line in the fine beach sand resolving the vast majority of uncertainties in the planning denomination of Marbella's properties including some of the best known developments of apartments, townhouses and individual villa properties.
Increasingly we are seeing property owners who are keenly looking to sell their apartments and older re-sale properties. Invariably these are multiple purchasers who have been required to complete and who are seeking to recover their investment.
Whilst the number of estate agencies has dwindled in the last eighteen months or so those that remain are noting some embryonic green shoots of recovery in their businesses. Particularly, national groups such as the Germans and Russians seem to lead the buying lists. So this year's new spring buyer may not be just the traditional purchaser who has weathered yet another freezing winter in Northern Europe and who now feels that their bones could use some year round warmth. May be they are attracted by prices that clearly reflect the "correction" that has taken place in this market over the last couple of years.
However, the laws of simple economics come into play when supply exceeds demand. The net result is a "buyer's market" where only the fleet footed and well-prepared sellers can attract the spoilt-for-choice buyers.
Are you a serious seller?
It's said that the majority of more mature Spanish property is always for sale. The thinking being, given the rise in values over previous years, that a seller with substantial equity in their property may chose to sell if a purchaser came along and offered the right price. Well, for a serious estate agent such a seller is a complete nightmare. They are not committed to working with their agent to make a sale and seem ambivalent as to whether they should sell or not. They are just testing the water. In the current market such an attitude will not result in a sale.
So just how does a Seller place his/her property head and shoulders above the rest - and how can they close that sale?
1. Instructing an effective marketing and sales estate agent.
What should a seller look for?
a. Find a specialist in the region where your property is located or a more major business that has a local office. In either case the staff should have regular experience of the current values of properties in your region.
b. Look at the estate agents web presence - are they able to provide a professional and focused service for buyers?
c. Rate - much has been written about the costs of retaining the services of an estate agent. In their defence costly marketing has a very important role to play and an agent often has to work a lot harder to sell a property in Spain. A sales commission of 5% plus local VAT is not at all unusual.
d. Price - Your agent should be an expert on current market value which is currently the best barometer of price. You may also want to ask a Surveyor to give you an accurate valuation based on comparables.
This may be useful for two reasons. Firstly, it should be accurate and bring you the comfort you may need that the resulting asking price is realistic. Moreover you may have heard of stories in the current market whereby the Spanish Tax Authority (known as the "Hacienda") is carefully looking at "under valued" sales primarily in the effort to weed out a tax fraud based on the practice of under declaring the sales price of a property to reduce the tax paid and to hide the "black money" cash handed over at completion.
Given that many properties are now being sold for significantly less than they would have changed hands for a couple of years ago having an authenticated record from a professional valuer is good and timely evidence to deal with any subsequent claim from a naive - and perhaps uncommercial - Hacienda official who may seek to argue that you sold your property and under declared its price.
e. Review - Insist on regular reviews from your estate agent showing the work done by them to market the property, the leads that have replied and visited the property. It is also vital to get feedback from those who have visited as to why they haven't offered.
f. HIPs - I have been exploring with a couple of estate agents the idea of a seller funded Home Inspection Pack - prepared under Decree 218 of the Spanish Property Law Code. The idea is that all documentation relating to the house, its deeds, (Escritura), any building licenses obtained for renovations, its services - electricity and water bills and local taxes - the equivalent of the Rates - should be collected together in one pack to ease the buying process. There is nothing worse for the purchaser's lawyer than the need to request endless different documents that a serious seller could collect together in an efficient way from the start of the sales process.
2. Retaining a good Abogado - a lawyer:
Given the effectiveness of the Spanish Land Registry some believe that the cost of retaining an experienced property lawyer to process a sale is an expense worth saving. My advice is that such thinking is flawed and may risk the sale and generate consequential expense. Your Abogado will:
a. Prepare and processing the sales contract.
b. Deal with the redemption of any mortgage and other outstanding sums required due on the property, including as local taxes.
c. Complete and correctly file all necessary tax returns.
d. Try to minimise the seller's exposure to Capital Gains Tax.
e. Obtain a Tax Certificate from the local "Hacienda" - tax office - to negate the buyer's necessity of making a 3 % retention of the purchase price.
f. Assist the sale - All parties that comprise the buyer need to hold NIE number to make a purchase. We have seen examples where the lawyer has been able to obtain an NIE number for a purchaser at very short notice thereby potentially saving the sale.
3. Dressing the Property for sale:
"Unloved" or over designed interiors are - along with price - one of the most noted "turn off's" for a potential purchaser. Consider employing the services of a "House Doctor" who will stage your house in the best possible light for sale. A TRG Partner is such a service who is very active in the Marbella region of the Costa del Sol. They visit resale properties with a view to neutralising bad or outdated taste and "dressing" them for potential buyer interest. Time after time "Start2Finish" is required to advise it owner clients to bin tired or outdated furniture which has been brought over from their previous home by the purchaser, often many years before.
Below is a simple guide of the costs of selling in Spain - what the seller is responsible for:
The Seller's own Capital Gains Tax - based on 18% of any increase in Escritura or Deed value declared to the Hacienda at purchase.
Plus Valia Tax - This is a local municipality (Town Hall) tax based on the increase in the value of the land from when it was last sold. This is a one off payment. We have seen circumstances where this tax is paid in an agreed division between the buyer and seller. To avoid any confusion is important to decide at the outset of the purchase whether the buyer should be asked to shoulder none, part or all of it.
Selling Agent Fees - plus IVA - as agreed with the Estate Agent - these can range from 3% to 10%
Legal Fees - between 0.75% and 1% (plus IVA and disbursements) of the purchase price.
by: Xana Sexta
It Is Safe To Live In Spain Natural Heritage In Spain El Escorial, The Famous Palace Of Spain Vitoria-gasteiz - The Other Spain Places Of Interest In Spain- Alaior Places Of Interest In Spain- Alhaurin Toledo city in spain Car hire Spain! Barcelona, Spain: A Rich Mix Of Culture, Sun And Fun Attractive Madrid In Spain Best Places In Spain Andalusia Region In Spain Spain - A Unique Culinary Experience