These preliminary agreements, often only one or two pages long, are frequently presented as a "reservation agreement", although they are in fact a legally binding preliminary contract. By signing such an agreement, you already undertake to purchase the property at a specified date under the conditions set out in the contract. A "reservation agreement" drafted and presented by a real estate agent can therefore quickly become a legal pitfall, particularly with regard to the deposit.
Due diligence, a risk assessment conducted with “due care,” analyses the legal status of the property as well as any potential risks. This preliminary analysis plays an important role both in determining the value of the property and in providing legal protection for the buyer.
Property purchases in Spain may generally be financed either through Spanish banks or through foreign banks. However, following the entry into force of the new Spanish Mortgage Act, obtaining financing from foreign lenders has become significantly more difficult in practice. In order to enhance consumer protection and prevent unfair lending practices, the new legislation requires, among other things, the electronic transmission of the mortgage documentation between the lending institution and the notary. Consequently, the lender must be connected to the digital platform established for this purpose.
German citizens, as well as all other European citizens, can generally purchase property in Spain without restrictions. Real estate can be acquired either through a private purchase agreement or by means of a notarial deed. To avoid unpleasant surprises during the purchasing process, it is advisable to consider the following points carefully.
This article is aimed at individuals who reside within the EU and own a property in Spain. We frequently encounter property owners who use their property in Spain themselves for only part of the year and therefore decide to rent it out during the remaining periods in order to generate a better return.
In order to register the purchase of a property with the Spanish Land Registry, the purchase agreement must be executed before a Spanish notary. This can either be done by having an existing private purchase agreement notarised in the presence of both parties, or by having the purchase agreement drafted directly as a notarial deed of sale (escritura pública de compraventa).
Renting out holiday apartments and rural holiday homes in Andalusia requires compliance with a number of legal requirements and registration in the relevant tourism register of the corresponding Autonomous Community. In Andalusia, a distinction must be made between urban tourist accommodation and rural holiday homes. In the latter case, registration in the Andalusian Tourism Register is mandatory.
As in Germany, owning property in Spain entails certain tax obligations and consequences. Understanding these tax aspects is important not only after purchasing a property, but particularly before the purchase, in order to make a well-informed decision regarding your property in Spain:
In Spain, a general distinction is made between residential tenancies and non-residential tenancies, with only residential tenancies benefiting from the specific protection provided by residential tenancy law. If a property is rented for the purpose of carrying out a commercial activity or for temporary or seasonal accommodation, it is not considered a residential tenancy and is primarily governed by the terms agreed between the parties.
The purchase and sale of real estate in Spain involves a number of tax obligations for both the buyer and the seller. Understanding these taxes is essential not only to ensure compliance with the applicable legal requirements, but also to optimise the costs associated with the transaction.
The judgment of the Court of Justice of the European Union of 21 December 2016 makes it possible not only to claim reimbursement of amounts paid as a result of floor clauses (cláusula suelo) and disproportionate default interest, but also opens the door to claiming reimbursement of all amounts and fees paid by the borrower as a result of unfair contractual clauses contained in their mortgage agreement.
As is well known, following the reform introduced last year, it is mandatory to apply to the Land Registry for the allocation of a Rental Registration Number (NRA) for each short-term rental property.
Good news for individuals residing outside the EU: they may now be able to deduct expenses related to the rental of their property in Spain for tax purposes. Until now, only taxpayers residing in the EU, as well as in Iceland, Norway and Liechtenstein, were permitted to deduct expenses related to the rental of property in Spain, subject to the applicable legal requirements.
One of the ways to acquire a property in Spain is to purchase a property under construction directly from the developer. In this case, a private agreement is entered into between the buyer and the developer and a payment schedule is established. In this case, a private agreement is entered into between the buyer and the developer and a payment schedule is established.
Since May 2016, Decree 28/2016 of 2 February on holiday homes in Andalusia applies whenever your property is located in Andalusia, you regularly rent it out or intend to do so, and you advertise it for this purpose through agencies, websites, third parties, etc.
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