In the current Spanish real estate market, properties are selling for less and sales completion are quite straightforward.
Unfortunately, in the Marbella area we are seeing more sales going abortive due to issues with properties which sellers aren’t dealing with early enough in the process. When compared to markets like Madrid or Majorca, it’s easy to notice that the trend has been reversed: properties are selling for more and sales are taking longer to complete.
There are lots of tips available about safely buying a property in Marbella. Top 5 tips are as follows:
- Urban Planning: Marbella urban plan was declared void by the Spanish Supreme Court in 2010. This means that an urban plan enacted 30 years ago (PGOU 1986) is now fully binding. As a consequence, most residential properties in Marbella are now deemed as illegal. Cheated owners are now looking forward to sell their properties – with the invaluable help of real estate agents – to unwary buyers. Instruct a verified and trusted legal team to check the specific property and to confirm whether the construction is legal (due diligence) becomes critical.
- Hiring a True Solicitor: If hiring a solicitor currently practicing in Spain please check that he is qualified, reliable and have experience operating in Spain. A true solicitor – unlike a bare Spanish lawyer – must be registered with the Law Society in the UK. Double qualified solicitors are entitled to practice simultaneously in the UK and Spain and do normally specialise in international transactions. At Fitzwilliam, our real estate practice is steered by a Double Qualified Solicitor of E&W and Spain.
- Timescales: Try to agree timescales for completion at the outset. A solicitor should be able to assist with this and it helps to focus all parties’ minds on getting the deal done. Of course, do not sign any papers or hand over any money until you have taken independent legal advice.
- Tax Liens: A tax lien is a lien imposed by law upon a property to secure the payment of taxes. In Spain, tax liens are extremely common and may be imposed for many reasons, normally as a result of failure to pay income taxes or other taxes. If buying a villa of significant value, beware of the special tax to residential properties owned by overseas companies domiciled in a tax heaven (most commonly, Gibraltar or BVI). This amounts to 3% -of the property value- per annum, and is a common tax lien.
- Legitimation and Consents: As buyer’s solicitors we require lots of information about the property. Liaise with your solicitor as early as possible to make sure he requests the Seller to provide all the correct documentation. Everything shall be inspected in advanced, from works which have been carried out to the property to the identity of the Seller and his binding powers to proceed with the sale. Be open and flexible to the solicitor’s requirements. There is no getting around the fact that it is a buyer’s market at the moment so you need to listen to any issues which the solicitor raises and then have a realistic conversation about your options.
For further information about the issues raised in this blog, please contact any member of our Real Estate team or send an e-mail to firstname.lastname@example.org