Legal Considerations

Because this issue is so important when you are considering buying property in Olvera, Spain, we would like you have some benefits from our insights into the Spanish legal system regarding purchasing property in Andalucía. What you see here is not definitive, it is more of an outline and is no substitute to legal recommendations from your lawyer. On this understanding please accept this offering:

An outline of the legal issues you have to consider when buying property in Olvera, Andalucía :-
You are advised to get help from a lawyer (a local Spanish lawyer is better versed localy and could be considered a minimum requirement) when purchasing property.

Pre-purchase

A 10% deposit is some times required although often less is acceptable, to hold the property from the market for 4 to 8 weeks depending. This allows a breathing space so that all relevant documents can be brought together for scrutiny. This is a good time to check that NIE (see below) and bank accounts etc. are in order while the property is Under Offer. If the completion of the sale does not take place the deposit is non-refundable and it becomes the vendors. Conversely if the vendor accepts another offer during this time period they are obliged to refund double the deposit.

Often property in Olvera is in need of some renovation and you need an idea of what you are prepared to do. We highly recommend that a survey be done, by a registered surveyor, to ensure that the structure is sound and that you are buying what you expect. This costs in the region of 300€ to 400 €. If furniture or some subsequent service or commodity are included within the sales contract we would recommend a complete inventory of expectations to be signed in front of legal representation.

In order to start negotiations you will need a local bank account and (although this seems to differ in different provinces and even within different districts) a "Numero Identificacion Extrañero" (NIE) or a NIF if you are resident in Spain. The Notaria in Olvera insists on this identification number for all house purchases - on its own, a U.K. Passport cannot and will not do.

Opening a bank account in Andalucía :-
All you need is a passport or NIE.

Obtaining an NIE :-
Allow a week, minimum, to have this legal process completed by the Policia Nacional (Estrañeros)..
You will need a passport and a completed application document with a finger print. A lawyer with power of attorney can help do this for you.
Olvera Properties can arrange the document needed to apply for your NIE and a ride to the nearest Policia Nacional (Estrañeros) to complete the process as well as picking up your documents a week later should any of our clients require this service.
An NIE is essential to purchase property and is required for such things as; buying a car, sending you children to school, making a will, running a business as well as for becoming a Spanish resident.

Spanish Residency -
You do not need residency in Spain to purchase a property in Spain.
If you spend more than a certain time (ask your lawyer) in Spain or have some business in Spain you may need to become resident.
For U.K. residents it is easy to obtain Spanish residency as we are EU members.
Once you have a property, go to the town Hall to register using the "empatronada" form.
You require proof or residency, in this case the property deeds or "copia simple", along with your NIE, employment details and tax records.
About a week later you will be provided with your NIF which completes your Spanish residency.

Buying

There are 2 ways of purchasing a property in Olvera, Spain :-
Private contract:
This is a "quick" way of transacting the sale and is a "spit-on-the-palme-and-shake" deal.
This method can have difficulties if all the legal niceties are not followed.
Paperwork (such as the "nota simple", mortgages and land use agreements) is essential if you want to have a problem free purchase.
Ensure all parties concerned are in agreement.
Registered contract:
If you wish to get a mortgage on the property you have to complete your purchase this way - we advise buying with a registered document.
The Registry´s office ("La Oficina Notaria") will require all paperwork, including any possible outstanding bills or fees against the property, and will sign-off all legal aspects for a fee. All paper work must be checked by your lawyer before being submitted to the Notary.
This method, naturally, is Olvera Properties preferred way of doing the conveyance

In either case our advice is that you obtain, in written form and preferably with a lawyer present, anything that you expect along with the sale of the property, such as fixtures and fittings, furniture (inventory) and modification or further restoration before or after the sales transaction. In the case of a registered contract this may all be notarised.s

Tax :-
There is a 7% government tax on a house purchase price.
The notary, registration and lawyers fees are usually around 2% of the purchase price.
Thus an approximate working figure of 10% of the house price for these taxes and fees is a good guide.
Allow 100-200 Euros for change-over-of-name and helping with banking details (such as direct debit) for water, electricity and council tax, although in reality this figure is normally much lower. Local agents who handle these procedures are not Olvera Properties' personnel.

On this site we include in the price, all agency commissions*, unless we have been asked to broker another arrangement. You receive no further overheads when buying (or selling) a property through Olvera Properties.

Yearly Outgoings :-
Compared to the UK your average outgoings are likely to be low -
Around 100-200 euros a year for IBI, the equivalent of the community charge, for a 3 bedroom house.
About 50 euros a year for basura, rubbish collection.
Electricity, water and phone are all private companies. while the first two are likely to be cheaper, phone bills are typically higher than in the UK. Shop around or use a "Voip" application on your computer.
Internet access is readily available in Olvera and Pruna - depending on your requirements and the company you go with - charges from 25 euros a month and upwards can be expected.

Mortgages:-
Are available for non-Spanish residents.
The banks here are, like banks around the world, all trying to establish new rules for mortgages - in effect this means that more paperwork is required now and overall, mortgages tend to be smaller. For a mortgage in Olvera the banks here will require:

• a letter from your bank including your account details in the UK
• bank account movement for the last 6 months
• a letter from your work including your start of employment date
• your work contract
• your pay slips for up to the last 6 months
• proof, with dates, of any pensions paid over the last 6 months
• any rent or mortgage payments covering the last 6 months
• any proof of residence in the UK - a letter from the town hall
• proof that you are not a resident in Spain - this requires going to the Policia Nacional
• your P60
• a bank account with the bank that is supplying the mortgage.
• your NIE

Nowadays you can only expect 60% to 70% of the purchase price, whereas residents can expect between 80% to 100%. If you are buying a house that already has a mortgage you can get it transferred into your name but the bank will require all the normal paperwork (above) prior to going to the notary.
You can either obtain a mortgage locally or by using a mortgage broker. Olvera Properties will of course assist you throughout the process of obtaining a mortgage for a fee of 1%.

Of course you can find mortgages in the UK for your home here but there are some considerations that you need to think over including the interest rate, the exchange rate and the possibility of needing to transfer the mortgage if you wish to sell the property at some future date.

Other considerations :-
Often the number above the entrance door to the property is not the same as the number registered in the escritura or the catastral. This is normal for Olvera and other small towns in this region because as streets (and families) grew the numbers changed physically but not at the same pace as the records. In order to clarify the issue Olvera Properties has asked the notary to put a complete description of the property numbers in the escritura which they now do.

Selling

As a non-resident of Spain:-
The law now states that non-residents are treated the same as residents and native Spanish with regards to capital gains tax, however residents are given specific tax breaks.

As a resident:-
If this is your primary residence in Spain you have 2 years to reinvest in another (primary residence) house, when the appropriated amount will be returned upon purchase (i.e. the sale is effectively tax free).
Capital gains tax is now 18% for both Spanish National and non-residence.

Further considerations

Please note that we are constantly updating our web pages in order to provide the most accurate as possible description of any property listed and the services we provide. Property availability, the contents and overall prices however can be subject to changes that are outside of our control. Contracts with Olvera Properties involving interim agreements, such as commission rates, furnishing and subsequent modifications of the property, are considered legally binding with all parties and should be scrutinized by a lawyer before signing.

There are excellent lawyers, translators, architects, builders, electricians and plumbers available in Olvera who can facilitate you in every step of your purchase. Please see the Resources page for some indication.

* List prices can be negotiated and this may affect how Olvera Properties adjusts its commission payments.

Olvera Properties would also like to take this opportunity to underscore its business position: Olvera Properties is an estate agent, and keeps costs to the clients to a minimum while providing the best service that we possibly can. Olvera Properties ensures that all the paperwork on a property, prior to the sale, is as up to date as the Spanish authorities can provide, and informs our clients about any processes that may be outstanding up to the point of exchange of contract.
It is strongly suggest that all clients use the services of a structural surveyor prior to purchasing, so that there are no hidden surprises. If local builders are required, there is a (not-so-extensive) list and wherever possible please find out if they are fully insured and professional (i.e. all the workers are legal and paying social security). It si also strongly advise that architects, translators and site managers are used for larger jobs. In all cases:
(a.) That more than two itemised estimates are obtained for any job and
(b.) That a visit to work done previously by the chosen builder is granted and viewed in detail prior to an agreement and
(c.) That provision for penalty clauses be carefully thought out (if you change your mind mid-stream be very clear how much extra it will cost, also if work isn't done well or in time, what choices will you have?).
We also strongly advise anybody buying a property to employ a local lawyer to aid them through the process and provide any future legal backup.

Olvera Properties is NOT in the construction or building professional and we do not, as a company, take on or recommend any building work or building modification.

Legal Disclaimer
Please note, as indicated at the beginning of this page, the suggestions above are meant as a guide. Please, always consult your lawyer for advice regarding property purchase in Spain as
Olvera Properties cannot accept liability regarding advice issued on this web site.

Legal Disclaimer
Please note that all the property details on this web site are correct and accurate to the best of our knowledge and abilities. Prices and descriptions can and may vary from those represented on this web site as this is ultimately beyond our control. Interim agreements between vendors, purchasers and Olvera Properties are legally binding and must be scrutinized by your lawyer. Square meterage and hectarage is always an estimate and not of catastral accuracy.
Olvera Properties cannot accept liability for any inconsistencies regarding property description.

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