Buying property in the Valencia region should not be daunting at all. While the city of Valencia may not have too many English speaking agents you don’t have to look far down the Costa Blanca to find people willing to help you through the process.
So below we have compiled a little guide for buying property in Valencia and beyond.
THINGS TO CONSIDER WHEN BUYING PROPERTY IN THE VALENCIA REGION OR ANYWHERE IN SPAIN
SPANISH MORTGAGES GENERAL ADVICE
Despite the global credit crunch we are still able to offer very competitive mortgages to assist with your Spanish property purchase (subject to status). Obviously you will have to prove that you can comfortably afford the re-payments & that you have cash readily available for the balance. If you can do this then Spanish mortgages are relatively quick & straightforward to apply for. A property purchase with a mortgage should be completed within 4 to 6 weeks. Spanish mortgages are generally a little bit more expensive to set up than in the UK but we can offer mortgages with a bank opening commission from as low as 1% of the amount borrowed.
Any visits to Spain make sure you have short stay travel insurance as well as your EHIC card
You will also need to pay the bank valuation fee of around 300 euros. You may also be requested to take out buildings insurance & life assurance with the bank but we are able to offer very competitive rates. Average interest rates are currently around 4%. We can offer mortgages up to 70% of the property value. This means you will need cash for the 30% balance plus the additional purchase fees over & above the purchase price as outlined earlier. We can arrange your Spanish mortgage for you.
There are numerous branches of all the major Spanish banks along the Costa Blanca & Costa Calida (significantly more bank branches than in major UK towns). All of our banks cater for British customers and we can offer bank accounts with current & deposit accounts, cheque books, credit & debit cards & internet & telephone banking all in English. You can even set up a sterling deposit account! We are currently working with most Spanish banks Lloyds TSB, your English bank in Spain.
THE NIE NUMBER
An NIE Number is a tax identification number to be used in Spain. Prior to purchasing a property, selling a property, obtaining a mortgage, starting up a business, working or simply residing in Spain, it is a requirement by law that every individual possess an NIE Number.
The actual NIE Number, when produced from a National Police Station in Spain is printed out on a piece of paper, and this sheet of paper is often used as a form of identity. Once you have been issued an NIE number, it is yours for life.
Spanish law states very clearly that the person must apply for the documents in person. However, the Spanish law also clearly states that a legalised, Spanish power-of-attorney document enables any individual to be represented by another for all legal purposes in Spain (as long as it is declared as such within the power-of-attorney).
Of course, anyone that can enter Spain legally can apply for their own NIE number. To do this they must present themselves at the National Police Station in whatever town they are living. Unfortunately, contrary to countries such as England and Ireland, there is very little standardization for exactly how the physical process of application works from one police station to the next, so if you chose to apply in person, please make sure you find out beforehand which are the requirements to apply for a NIE Number at your local police station. This will save you from having to arrange several trips to have your application presented, with the corresponding lengthy queues.
You can also apply through a Spanish Consulate. The average time required for an individual to obtain their NIE number via applying through a Spanish consulate is 12 weeks. This varies from one country to the next. We encourage people to contact their closest Spanish consulate first and enquire about their turnaround time.
BANK ACCOUNTS FOR SPANISH PROPERTY
If you intend to stay in Spain for a significant period, it is advisable to open a bank account. It is a very simple procedure which can be done at home or upon arrival. All you need to bring with you is your valid passport and the initial deposit. Banking hours for most banks are between 9am and 2pm on weekdays and from 9am until 1pm on Saturdays.
A Bank account will also be useful in the event that you wish to set up direct debits for payments such as mortgages, utilities, insurances etc.
There are many banks and all banking activity is controlled by the Bank of Spain (Banco de España), which has its central office in Madrid and branches in all provincial capitals.
Most Banks tend to provide English Speaking staff and these are some of the things you should take into account prior to choosing your new bank.
Do they have English speaking staff?
Do they have English internet banking facilities in English?
What type of Bank do you want? I.E. a Savings bank (Caja de ahorro) or a regular bank.
What charges will they make? Most things that a Bank does for you are chargeable here in Spain but you will need to find out the costs involved, especially for large transactions such as transfers from or to a U.K. Sterling account.
Their location to your property. Will you have to drive miles to your nearest ATM or to visit your Bank?
THE PURCHASE PROCESS BUYING PROPERTY IN THE VALENCIA REGION
The purchase process is much the same for both re-sale properties & new build properties. Off plan new build properties, which are in the process of being built, are offered with a varying range of staged payments depending on the individual builder.
You can also purchase new build key ready properties that are ready for immediate occupation & the deposit is much the same as a re-sale property.
Re-sale & new build key ready properties
Expect to pay a 3,000 euro non refundable reservation deposit, then 10% of the purchase price (less the 3,000 euros already paid) within 4 weeks & then the balance on completion. In some instances completion can be obtained in 4 / 6 weeks & therefore in these cases only a 3,000 euro deposit is required with the entire balance being due on completion. The completion time depends on a numbers of factors. Your solicitor will undertake all the usual searches & obtain copies of all the latest bills. If you are purchasing with a mortgage then this will generally take 4 to 6 weeks to obtain & therefore completion will generally be 6 to 8 weeks.
Off Plan New Build Properties
Expect to pay a 3000 euro non refundable reservation deposit & a further payment of 25% to 40% of the purchase price within 30 – 60 days after reserving the property. The balance is due on completion. Completion will depend on the build time of the property. Each developer offers different build times & different payment structures and some are negotiable.
Make sure that you are fully aware of the actual planned build time & payment terms before you have made any financial commitment & that these terms are contained within your purchase contract. Our solicitors will of course may sure that you are fully aware of your financial commitments & that all documentation is correct.