Buying A Property In Spain - Pointers For A Safe Purchase.

Read this carefully if you are thinking of purchasing a property in Spain. There are many things you should lookout for and steps you should go over with your lawyer to ensure a safe and trouble free purchase.

The Escritura Publica and Nota Simple

The Escritura Publica is the registered title deed of the property. It is entered in the 'registro de la Propiedad?, the Property Registry, and is the only guarantee of title in Spain. It contains a description of the property, the details of the owner and any mortgages or legal claims that exist against the property. This document is important because it tells you if the seller is the owner of the property being sold. A nota simple contains further details of any mortgages or charges against the property and is also available from the Registry.

The IBI receipt

Before purchasing a resale (not new) Spanish property check out the ?lmpuesto sobre Bienes lnmuebles?, or lBI, which is the municipal property tax. Ideally, you'll be able to see the IBI receipts for the last five years because that is the limit of liablity for unpaid back taxes and is attached to the property, not the owner. A new property bought from a developer will not have an IBI receipt (because it has never been ?owned?) so it will be your responsibility to register the property for this tax.

The Referencia Catastral

Every property sale must quote the 'referencia Catastral? of the property in question. The Catastro is another system of property registration in Spain, concentrating on the location, physical description and boundaries of the property. While the Property Registry focuses almost exclusively on ownership and title, the Catastro is concerned with property valuation.

These two systems do not communicate with each other, and it is common to find that the catastral description of a property differs greatly from the one in the Property Registry. It is a good idea to request the actual certificate from the Catastro with a full description of the property. The certificate is in two parts, one being a description of the property and the other being either a plan or an aerial photograph.

Community fees, statutes and minutes of the AGM

This only applies if you are buying a property in an urbanisation or where there are some ?communal? resources, shared amongst a number of properties. These are the fees charged by the ?Comunidad de Propietarios?, the Community of Property Owners, a legal body that controls all the elements held in common; the lift, gardens and pool for example. Each owner is assigned a quota, or percentage of the expenses which, by law, must be paid.

Utility bills

These assure you that the bills are paid and also provide an idea of what the running costs of the property will be.

Misc

If you are buying a property in an urbanisation, make sure that it is legal and registered by asking to see the approved ?plan parcial? at the town hall. If the property is on the beach, make sure the development is also approved by the Jefatura de Costas. For a new property, make sure that it has been declared for IBI and that the developer has made the 'declaracion de obra nueva?. Also ensure that the escritura mentions the house you are purchasing as well as the plot of land on which it stands. As an additional safeguard, it is wise to examine the town planning maps for the area around the property, called the Plan General de Ordenacion Urbana, or PGOU.

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Spanish Mortgages Explained

Does the thought of negotiating a property deal in Spanish bring you out in a cold sweat? The complexities of mortgages are confusing enough; let alone considering a different language and legal system.

Never fear though, as there are experts who can guide you through the process and do the negotiating on your behalf. Most will speak fluent English, and have a thorough knowledge of the Spanish market and house-buying process. As it has become more and more popular to buy abroad, the options have increased. You can now take out a 'spanish mortgage? with some of the high street banks and building societies, specially aimed at those buying abroad.

Brokers

The mortgage system and broker system is very different from that of the UK. When it comes to dealing with local bank managers and solicitors, a good broker could make a world of difference, simplifying the process and making sure that you clearly understand all the Spanish terms. Be aware that brokers in Spain are not regulated ? anyone can set up as one. You should look for one with an office, and that is SL registered (similar to a limited company). You can also request to see copies of certificates and qualifications. You will probably need to set up a bank account in Spain, or a multi-currency account.

Law Professionals

You'll need a qualified solicitor or lawyer, who is bilingual and experienced in the legal process of buying in Spain. Anything that requires a signature or payment should be checked with your solicitor first. If you are not going to be resident in Spain, you'd do well to appoint a ?fiscal representative? to deal with correspondence from the government while you're away ? your lawyer is an ideal choice. You may choose to employ a ?gestor?, a local who takes on the task of legal form filler and can assist with permits, licences and importing possessions, as well as financial matters. You may also want to consult a UK professional, such as a financial advisor, to check on tax issues. This will be particularly true if you intend to rent out your property.

Estate Agents

Officially registered, licensed estate agents can be your most useful contact throughout the whole process ? with a good local knowledge they can advise on both finding and buying a property. The internet will provide a vast amount of agents dealing in Spanish property ? check that they are fluent English speakers and fully licensed.

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