Law in Spain

Buying procedure

Contract
Spanish law does not require the conclusion of a pre-contract for the purchase of property. The parties may sign directly a contract of sale of the type generally public.

Registro de la propiedad
Buying a property in Spain must be formalized through public deed of sale drawn up before a Spanish notary and subsequent registration in the Registro de la propiedad. Furthermore, the publication of the act is tantamount to surrender the property to the effects of change of ownership (the Spanish civil law requires, in addition to the relevant document, the delivery of material and actual object of the sale).
Deposit
In certain cases, to protect the interests and rights of the parties may want to subscribe prior to a preparatory document, based on the oral agreements reached between the parties. The effects depend on the form, usually chosen by the seller. The most common are the following.
Deposit: delivery of an amount that does not correspond to the total purchase price as a deposit to reserve the property. Delivery is reflected in a document which outlines the essential terms and conditions of sale.

Compromise sale / purchase option
Unilateral or bilateral agreements, one party grants the other the exclusive right to choose whether to perform the contract of sale. The option must be exercised within a specified period and under conditions defined.
The most common is the purchase option, which assigns a priority to a part payment of a sum that will be considered an advance in the event of completion of sale and instead will remain at the seller otherwise. The party granting the pre-emption is required to:
keep supply throughout the period stipulated
not to sell to third parties on which the property is granted priority
in case of exercise of first refusal, sell the property to the agreed conditions.
This document, even if it is a contract of sale, not a transfer of ownership and can not be relied on in front of others.

Before the formalization of the contract
The buyer must be informed with respect to:
Registro de la propiedad, or the area where the property is situated;
or verify the ownership of the seller of the property;
or check the cédula habitabilidad or de Licencia de Primera Ocupación or an equivalent document
or request a declaration of the municipal status of compliance with the regulations of the estate planning;
or obtaining a receipt for the payment of property tax (Impuesto sobre bienes inmuebles);
or delivery of the certificate of payment of fees to the Comunidad de vecinos.

Forms property

Condominium or copropiedad

The main features are those listed below. It has no legal personality. Each owner holds an undivided common object and can make use of the property subject to a use that does not prevent any other holders to exercise their rights. Participation of the owners to the benefits and obligations in proportion to their shares. Decisions are made on the basis of the majority of the owners. Each of the owners may request at any time the division of the object or the sale by allocating the common price if the property is actually indivisible.


Corporate Form
In Spain, the property may be exercised through a corporate form, the most common forms are the Sociedad Anónima (SA) and Sociedad de Responsabilidad Limitada SL).

Propiedad Horizontal
Special arrangements apply to plans, apartments, houses, or parts of houses that can be used independently or in complex urban or estate consisting of two or more independent buildings or land, whose owners participate in the ownership of indivisible elements, facilities or common services.
Features Propiedad Horizontal
Each "owner" holds in every respect of their own home or apartment. The parties jointly can not be divided and are inseparable from private parties. The share of the common elements is defined by the Comunidad, and the statutes defining the standards to be met.
Decision-making bodies are the Comunidad de Reunión General Copropietarios, the President, the Secretary and the Administrador.
The Assembly shall meet at least once a year. Owners are required to maintain the property in good condition and facilities, both private and those municipalities, performing any necessary repairs. Owners must also designate a domicile in Spain for the purpose of notifications. In cases where an owner is unable to give an address, all notifications will be directed at the Comunidad and the owner will be considered informed in all respects.

Acquisition costs

Fees
Notary and registration fees derived from the conclusion of the purchase, which vary depending on the value of the property that is acquired. Ranged from 1% to 2% of this value.

Expenses for professional services
Cost of professional services (agent real estate, legal, tax or otherwise, real estate consultancy, etc.).. Specifically, the costs for staff and advice on real estate will vary depending on the location of the property in case of purchase of residential property, ranging from 3% to 5% and may reach 10% of the total price in tourist areas with higher incidence (basically, the coastal zone). These commissions are paid by the seller.

Bank charges
In the case of the stipulations of credit or mortgages (initial and analysis, etc..).

After purchase
Once completed the purchase, the costs are more common than normal due to the Comunidades de propietarios (relating to common areas, water, electricity, heating etc.).

 
Taxes
Tax expenditure associated with the purchase and possession of a property, described in the relevant section.

Public records

Buying a property in Spain, including consultation with the public Registry (Registro de la Propiedad, Departamento correspondiente de Urbanismo, Oficina del Catastro, etc..) And corresponding documentation of the Comunidad de propietarios, in order to avoid any legal impediment, due to recording or otherwise, regarding the completion of transfer of ownership from the seller.

Notary
The notary before whom it formalizes the transfer of ownership must obtain a measure of the register referred to the property subject of the sale in order to verify that the change of ownership there are no restrictions and / or legal grounds or due to the records.

Registry propriedade
The notary who will formalize the change of ownership, must submit the instrument corresponding to the Registro de la propiedad, the date of this act: This procedure will protect the rights of the purchaser during the period between the date of purchase and registration of the new title of ownership.

Marital status
In cases where the seller is divorced or legally separated, in charge Notary will check prior to purchase that the other spouse is not recognized as the holder of any rights on the property.

Responsibility
The contractor of a building liable for damages caused by construction defects for a period of ten years from the completion of the work. This responsibility extends, during the same period, the architect who directed the construction work, if the damage or collapse are to be traced to defects of the land or carrying out the works. If the collapse or damage due to failure to fulfill contractual obligations by the contractor, the action for compensation has a duration of fifteen years.

Rental agreement
The buyer of a house or apartment obliged to respect the lease for a term of five years from the conclusion of the contract even if it is not included in the Registro de la propiedad.

Restrictions purchase

Nationality of the purchaser

Spanish law only provides for certain restrictions regarding the acquisition of property by non-EU citizens compared to areas with interest of national defense.
To buy property in these areas is necessary to obtain a permit military. Generally, this permission is not required for the purchase of properties in villages or cities, although it is advisable to request information about the matter to the municipalities (Ayuntamientos) and Registros de la Propiedad concerned.

Residence of
In accordance with the provisions of Royal Decree 664/1999 of 23 April on foreign investment, the purchase of properties in Spain by foreigners is considered foreign investment if the amount exceeds the purchase
EUR 3'005'060 .52, or, regardless of the investment is made by a resident of a country designated as a "tax haven" by the Spanish authorities.
As a general rule, foreign investments in Spain are free and are not subject to authorization. However, after completion of the investment, it must be declared by submitting to the Dirección General de Transacciones Extranjeras (DGTE) a form MC-6. If the purchaser is resident in a tax haven, the presentation of Form MC-6 is required before acquiring the property.

Pre-emption rights of tenants, neighbors or family
They may have legal or contractual.
The rights of a contractual nature not recorded in the Registro de la propiedad may not be exercised against third party purchasers in good faith.
Legal Restrictions: The Tenant of urban property has right of first refusal on the purchase of the property leased, if the same is its habitual residence, but if there is an agreement that excludes this pre-emption, whether by way of the contract lease in the Registro de la propiedad. The owner must notify the tenant of its intention to sell the property, the cost of same and the conditions of sale, so as to enable the lessee to exercise any of his right within 30 days. In case of sale of the property without compliance with this requirement, the lessee may exercise his right and cancel the contract of sale within 30 days from the outlet of the sale.
The owners have a right of first refusal in the event that one or more other co-owners want to sell all or part of their stake to a third party. Owners of properties adjacent to a property on the market have the same right of first refusal in the case of rural land surface up to 10,000 m2, not separated by rivers, passages or shoes.