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Buying and Selling homes in Spain

Protect Yourself with those Property Bargains in Spain.

There was a time when properties were sold for two different prices, coyly known as ‘A’ and ‘B’ monies. The ‘A’ price was on the Title Deeds and the ‘B’ was cash in hand counted with spit dampened fingers far from the Notary walls. Even today the Spanish tax office turns a blind eye on a 15 – 20% difference plus or minus from the normal market price. Don’t be tempted though. In general, they don’t trust you and suspect something is afoot if you get too much of a good deal or agree to a bad bargain on your part. A Buyer will end up paying tax on the amount the government thinks the property was really sold for, the imputed amount. The only way to avoid it is to get a property valuation done and take your claim to court. Costly and time consuming if you lose.

For those of you interested, the imputed amount or REAL VALUE is based on coefficients from town halls, the Title Deed Price and the Cadastral Reference – based on sometimes outdated surveys of land boundaries. By or before July 2018 a land law reform is being introduced. Current recommendations by a government commissioned think tank is to change the REAL VALUE to reflect only the Title Deed Price. Another idea being mooted is to start charging a local capital gains tax on rural properties as well as the current policy of applying it to urban properties on gains from selling your property.

As we’ve seen, sales have picked up, still not a high percentage of conveyances, although slowly improving. The years of recession from 2007 hit Spain well below the belt with repossessed properties and ghost towns of brand new housing estates. In the noughties so many people were dependent in one way or another on the construction industry. When it ground to an almost complete halt, so too did the country. Fortunately, people and things evolve; no-one wants to return to those dark days, but the unscrupulous soon left the industry – why would they stay? There were no longer any rich pickings. The agents and agencies that managed to hang on in there during the lean times came through with a limp and a smile. Many, like TMT Spain Real Estate, offer more to Buyer and Seller as a matter of course. We feel we have a duty to explain and inform, both to our clients selling and the applicant looking to buy. Clearly, both form part of the same process. Naturally, we believe we always have done and our team have transferred skills and knowledge accrued in other professions as well.

What is an Agent?

An agent is just that, an entity acting on behalf of another. When it comes to properties the relationship is a tad contrived. The Buyer is usually an interested party whilst our client is almost always the Seller – but both come together in a bargain of offer, acceptance and consideration. The process can be incredibly fast or proceed slowly and cautiously. We don’t mind, we’re there to help however long the journey. Our local knowledge and connections are relied on by Seller and Applicant alike. Whether it be by acting merely as a de facto tourist information service – every Estate Agent recognises that function, or making sure you understand how properties are bought and sold. Our neck of the woods is the autonomous region of Andalusia, Spain.

Be Safe – Learn the Process of Buying & Selling Resale Properties in Andalusia.

There are many more Resale properties on the market than new builds, but you can once more see cranes along the skyline. This is happening because of unfinished promotions being revamped and also due to brand new green field sites being built – both courtesy of new Land Law Legislation for Developers and Promoters to take the plunge and invest in Spain.

If the house you want to buy has had others living there already, a Resale, termed ‘second-hand’ in Spain, you need to check the following documentation:

  • Title Deeds. Make sure the person selling the property really is the owner or authorised to sell. We check this as part of our general due diligence when we list a property.
  • Ownership and status of housing charges. (Simple Note of the Property Registry). For this you need to ask for ‘Datos Registrales’ which give ‘Finca, Tomo, Libro & Inscripción’ stating what the property registration number is and where it is filed – both literally and in which district. This information is on the Title Deeds or a copy of a ‘Nota Simple’
  • Last annual IBI receipt (Council Tax or Urban Tax, Impuestos Bienes Inmuebles).
  • Community of Owners’ receipts proving that the seller is up to date with payments of shared community expenses. (It’s a proprietor owned management company.)
  • Latest receipts of utilities: water, electricity, gas, etc.
  • Completion on Property. If the conveyance follows the normal convention the Seller pays the costs of cancelling his/her mortgage and the bulk of the Notary costs for drafting the new Title Deeds. The Buyer pays for the Title Deed copies, registration fees and, as appropriate, VAT or Property Transfer Tax. However, it is not mandatory to follow that convention although common.

The Buyer should allow approx. 12% – 15% on top for costs. You pay Stamp Duty, Transmission Taxes, Notary Fees and Land Registry Fees. Plus, lawyer’s fees should you decide to instruct one. (It is not obligatory.) In the past, you also had to pay the mortgage lenders’ Notary and Stamp Duty costs for putting the mortgage in place – which with the admin fee added up to about 4% of the amount borrowed. But this practice has been ruled out by the Supreme Court as an unfair contract term and now you only pay an admin fee on taking out the mortgage and any costs that fall directly to you. Those who paid this in the past can claim back these costs providing the mortgage is still in place or was paid up in the last four years. Refunds in Andalusia are on average 4,313 € according to the property portal Idealista and Legal Services Provider, Reclamador. (a ‘crowd complainer’ platform,). The protection available for the consumer does serve to underline how the legislature has acted to inject confidence in the property market once more.

Property Taxes are levied against the price of the property as stated in the Title Deeds. At the time of writing, assuming no special cases, the Seller pays 8% ITP on a property up to 400,000 €, 9% from 400,001 € up to 700,000 € and 10% thereafter.

Garages and Parking Spaces in Underground Garages can either have a separate Property Title Deed or be annexed to the Residence’s Title Deed. For separate Deeds it’s 8% tax up to 30,000 €, 9% to 50,000 € and 10% thereafter for a maximum of 2 garages or parking bays. Make sure you know which parking space belongs to the house or apartment that you are buying, it’s an area that can sometimes be overlooked. The applicable Property Taxes are the same as for properties when sold in the same Deeds.

Property Sellers are responsible for:

  • Certificate of Energy Rating. ‘Calificación Energética’. Drawn up by an architect evaluating the energy consumption of the dwelling. In Andalusia, almost all resale properties rate as Grade E, with Grade A being the highest, it may not be perfect, but it is normal.
  • Town Hall Capital Gains Tax – Incremento del Valor de los Terrenos de Naturaleza Urbana (IVTNU), more commonly known as plusvalía municipal. The clue should be in the name – you have to make a capital gain to pay this. But many local authorities have been exacting payment form Sellers even when they sold at a loss, basing the value on the cadastral reference as well as the old inflated market prices and opting for whichever price was higher. Note, a Supreme Court decision enshrined in law 15th June 2017, has made it illegal for town halls to invoice Sellers for this if they have sold their home at a loss. People who were forced in the past to pay it despite making a loss can now claim this tax back from the Town Hall. It’s an odd remedy called a revocation process (Procedimiento de revocación.) What makes it strange is how the decision to go ahead with the claim lays in the hands of the local authority. (IKR.) Court decisions are now starting to create their own precedent.

Buying Off Plan or New Builds confirm the following:

  • Works Licence in place
  • Bank Guarantee to protect in case developer goes belly up
  • Occupancy Licence issued before completion
  • Building Specifications have been adhered to
  • Stage Payments where appropriate coincide with actual completion of construction stage as described
  • Snagging List done and signed by both parties
  • Utilities supply and connection paperwork formalised
  • Value Added Tax is 10%

Other than that, enjoy your home in the sun, by a pool in summer and a wood burning stove in winter.

There’s never been a better time this decade to move home or shuffle portfolios.

And if you are looking to buy or sell a property in Southern Spain, get in touch with TMT Spain Estate Agents – we’re happy to help.


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Mortgage Borrower Pays AJD

Supreme Court Decision Person Taking Out Mortgage Pays AJD

Supreme Court Ruling Mortgage Borrower Pays AJD

The average set-up costs for a mortgage is around 3,000€ to 4,000€ depending on the amount borrowed. This is roughly broken down into a tax on notarised documents (AJD), notary fees, administration fees, land registry fees, stamp duty and copies of the notarised document. Back in December 2015 a leading case paved the way for people with mortgages to claim back the costs that they had been forced to pay. The Court decreed that mortgage lenders do not have the right to decide these should be paid for by the other party. It stated such costs should be shared but did not go on to stipulate percentages. The implication was that it should be an even split at least.

This led to claims against mortgage lenders and the flood gates opened. The Law Courts are always busy, and the last thing needed was additional workloads. Having said which, many judges in Autonomous Communities seemed to champion the little man, striking out clauses they deemed Unfair Terms and forcing the mortgage lenders to pay back what they had charged plus legal expenses of the claimants.

Mortgage Borrower Pays AJD

All has now changed again. On February 28th 2018, the Plenary of the First Chamber of the Supreme Court deliberated and decided two appeals in favour of the mortgage lenders. The Obiter Dictum, or wider generalisation to be taken from this, is that the Transmissions Tax on Documented Legal Acts (AJD) must normally be paid by the client, while the stamp duty on the notarial documents will be paid by both parties. Costs of copies of the mortgage will be borne by the party who requests them. In Andalusia the AJD is 1.5%. this leaves notary fees, administration fees and land registry fees up for grabs.

Mortgage Borrower Pays AJD

The Court’s judgment is based on a Statutory Regulation that says the loanee is the one who pays the tax and as a result the party mortgaging their home, the mortgagor, is liable. The full court decision has yet to be published, but as it stands, without the in-depth analysis of the Court’s findings, the court has used a Regulation to serve as a magic wand to restore order and quell rebellion. But a Regulation has less legislative force than a Statute conferred by Act of Parliament and is not of universal application. It wields the equivalent force of a statutory instrument.

A Supreme Court decision ‘trumps’ that of a lower Court. But, provincial courts in Autonomous Regions have consistently ruled in favour of the mortgagor since the leading case in December 2015. Until there is legal certainty, this political duel looks likely to continue. Let’s see what the Judgment proclaims when it is published in the next few days.

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Spanish Property Sales Up 2017

Spanish Property Sales and Transfers Increase in 2017

Spanish Property Sales and Transfers 2017

Up once more compared to 2016 according to figures published by the Institute for National Statistics  in Spain (INE).

  • December saw 125,263 properties registered at Land Registry, almost 2% more nationwide than in the same month of 2016. This includes all transmissions of property, for example inheritances, easements, resale and new first time sales etc.
  • December Sales showed a 9.2% increase on same month for 2016.
  • 64,135 sales were recorded for December 2017, of which 85% were urban properties and 15% rustic dwellings.
  • Over the twelve months of 2017, property sales increased by a significant 14.6%

Spanish Property Sales Up 2017

Registered housing sales, including government owned accommodation.

  • In December, 89.7% of dwellings sold were those on the free-market and 10.3% were protected housing.
  • In annual terms, the sales of free-market homes increased by 8.4% and protected properties by 16.5%.
  • 17.8% of dwellings transferred by sale in December were new, and 82.2% were Resales.
  • The number of transactions on new properties increased by 11.0%, while that of Resales increased by 8.8% compared to December 2016.Spanish Property Sales Up 2017

What does this mean for Andalusia? Making sense of it all.

December 2017

December 2017 alone saw 20,812 registered property transfers for Andalusia.

This equates to 95 transfers for every 100,000 inhabitants. Third highest in Spain after Valencia and The Balearics.

Of this figure, 6,287 were property conveyances – selling of properties in the open market –

This marks a 10.7% annual increase. Compare this to the Catalan region, down by 5.7% and it is tempting to emphasise how markets need stability. Andalusia with its infrastructure, sunshine and stable political environment is a great place to invest. Make up for dips in your portfolio for Spanish property from 2007 onwards; property purchase always has highs and lows, but now is the time to get those bargains once again.

Property Conveyances Andalusia 2017

  • Andalusia realised 293,538 conveyances for 2017.
  • An annual variation of 5.6% in change of property ownership for the year including inheritances etc.
  • This is an annual variation of 12.6% as a result of home sales on the open market (89,337).
  • It equates to 1,356 per 100,000 inhabitants.
  • 51,878 properties were classified as rustic.
  • 149,995 were urban properties.
  • 14,601 were plots.
  • All other transactions amounted to 77,064.
  • 16,397 conveyances were new builds. The off plan market has started up again.

Spanish Property Sales Up 2017









We are in the early stages of a new market with properties reduced to lower than their real values by owners who just want to shift them. For those of you who lost money in the downturn of the market, act now to recoup losses. For those of you thinking about investing for the first time, now is the time to commit.

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Housing Sales Rise in Andalusia amidst Buoyant GDP figures for Europe.

Housing Sales Rise in Andalusia.

Andalusia came second in sales increases for November according to the Spanish Institute for National Statistics. INE. This is because house prices are extremely inviting and it is a lovely place to live or come to for holidays. Property prices are still lower than what they should be. Take advantage now.

Winners and Losers

The Autonomous Communities that registered the greatest annual increases in the number of housing sales in November were Aragón (24.7%), Andalusia (24.3%) and Castilla–La Mancha (23.7%). In comparison, Extremadura (–9.7%), País Vasco (–1.3%) and Asturias (3.5%) registered the lowest annual rates in November.



GDP grew by 2.5% across Europe

In Europe the fourth quarter of 2017 shows GDP up by 0.6% in both the euro area and the EU28 up +2.7% and +2.6% respectively compared with the fourth quarter of 2016.

Seasonally adjusted GDP rose by 0.6% in both the euro area (EA19) and in the EU28 during the fourth quarter of 2017, compared with the previous quarter, according to a preliminary flash estimate published by Eurostat, the statistical office of the European Union.

In the third quarter of 2017, GDP had grown by 0.7% in both zones. Compared with the same quarter of the previous year, seasonally adjusted GDP rose by 2.7% in the euro area and by 2.6% in the EU28 in the fourth quarter of 2017, after +2.8% in both zones in the previous quarter.

Over the whole year 2017, GDP grew by 2.5% in both zones.

GDP and Property Prices Rise

Residential property price indices (RPPIs) directly and indirectly influence economic policy.

From an individual household’s perspective, real estate often represents the single largest investment in their portfolio. It also accounts for the largest share of wealth in most nations’ balance sheets. We do not need to be told how changes in house prices can have far-reaching implications for individuals.

House prices influence home improvement and renovations expenditures and there are property bargains out there to buy and reform. Even some minor reforms can significantly increase the value of the property.

Understanding Supply and Demand

House prices also influence the decision to build new houses (the supply side) as well as the decision to become a homeowner (the demand side). Investors turn to house price indices to measure wealth and to help assess current and future rates of return.

From a broader perspective, analysts, policymakers, and financial institutions follow trends in house prices to expand their understanding of real estate and credit market conditions as well as to monitor the impact on economic activity, and financial stability and soundness. For instance, mortgage lenders will use information on house price inflation to gauge default risk. Central banks often rely on movements in house price indices to monitor households’ borrowing capacity and debt burden and their effects on aggregate consumption.

It is still a buyer’s market in property in Andalusia, but, to quote Bob Dylan,  times they are a changing . . . which is great news for those owners trying to sell their properties.

For those looking to buy, invest now or spend more later.

For those looking to sell, it could be that your property is on the market at a price which undervalues it.

Get in touch with us to arrange a tour of properties or to get a valuation of your property with a view to selling it.

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Number of Foreclosures Fall by a Third

Mortgage Payments Easier.

Repossessions have fallen year on year and quarter on quarter. The table below shows the third quarter for 2017 down about a third on number of foreclosures. The same quarter four years ago showed more than 23,600. In the third quarter of 2017 this had fallen to just over 9,000.

1st quarter 2nd quarter 3rd quarter 4th quarter  
2017 17.000 13.605 9.025  . . .
2016 19.337 20.998 14.662 18.107
2015 31.182 28.954 19.625 22.716
2014 32.645 33.069 23.608 31.217

Foreclosure statistics down down down.

These clearly show number of foreclosures falling. These figures relate to all rural and urban properties. The information is broken down based on variables such as the type of building, system, status and owner of the properties being repossessed. The Association of Land and Mercantile Registrars of Spain (CORPME) provides centralised information to the INE – the centre for National Statistics in Spain.

This is, of course, great news and a strong indicator of a recovering economy. The other side of this analysis is there are fewer repossessions coming onto the market.

Are you looking to enter the housing market? Do you have a  good income, but not much money saved for a deposit?

You could take advantage of a 100% mortgage offered by a bank that has properties on its books. We recommend that you take a look at the housing market now.

If you prefer to absorb the information with graphs, please see below:






















Home buyers

We have repossession properties available with various banks – some of which offer residents up to 100% mortgage and non residents around 85%. The normal requirement is that you have money to cover taxes or approximately 10% of the total amount borrowed.


For those of you looking to make a cash purchase or with up to 30% down payment the range is greater as it includes motivated sellers and private distressed sales. There has never been a better time since the crisis to buy a property. For the first time this decade property sourcers and investors are seriously considering buying to reform and sell on within a relatively short term.

Contact us to see if any of the repossessions on our books could be what you are looking for.


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Property Purchase Taxes Andalusia

Property Taxes in Andalusia when Buying a Property

Property Taxes when Buying a Property in Andalusia

Buying a property in Spain is a straight-forward process. Each autonomous region has the right to set its own taxes, so differences do exist, although small. We help people buy and sell properties in Andalusia, in the provinces of Málaga and Cádiz. So, we provide information from the Junta de Andalucia’s website regarding the taxes levied on purchase and you can find general information on taxes levied on the Seller by the Town Hall, here. On the whole, budget about 13 – 15% on top of property purchase price for attendant costs. (Buying at auction has different requirements, find more here.)


Tax Payable – New Properties

First Transmissions of properties attract 10% tax plus a stamp duty on the drafting of the first title deed which is 1.5%. Total is 11.5%


Tax Payable – Resale Properties

For most people you pay 8% up to the first 400,000€, 9% on next 300,000€ and 10% on all amounts accruing after that.

The amount owing is calculated by multiplying the relevant band with the applicable coefficient as follows:

  1. Transfer of Tangible Assets

a) Property Transfer:

  • As a general rule, in the transfer of immovable property, as well as in the constitution and assignment of rights in rem over them, except in the real rights of guarantee, the tax rate will be obtained by applying, on the basis of the liquidation, the rate that results from the following rate:
Band payable in Euros Total Fees Euros Amount Due Euros Rate Applicable
0.00 0.00 400,000.00 8.00%
400,000.01 32,000.00 300,000.00 9.00%
700,000.01 59,000.00 There after 10.0%
  • Garages attached to the Property Purchase are included in the rates above, with a maximum of two. After which, in the case of transmission of buildings classified as urban parking space, the following rates apply:
Band payable in Euros Total Fees Euros Amount Due Euros Rate Applicable
0.00 0.00 30,000.00 8.00%
30,000.01 2,400.00 20,000.00 9.00%
50,000.01 4,200.00 There after 10.0%

b) Transmission of movable property and livestock

(as well as the constitution of real rights over them other than the guarantee):

  • 4 %, in general
  • 8%, on the transfer of boats of more than 8 metres in length and on vehicles of more than 15 horse power and objects of art and historical antiquities.
  • 5% in the transmission of real estate where the real value does not exceed 130,000 euros and it is to be the Buyer’s permanent residence and the buyer is under 35 years of age, or 180,000 euros in the case of a permanent residence where the Buyer suffers from a disability which is registered and measured as being equal to or greater than 33%.
  • 2% in the acquisition of housing for resale by a natural or legal person who carries on a business activity to which the rules of adaptation of the General Plan for the Real Estate Sector apply. (Aimed at constructors, developers and banks with repossessions, for example.)
  • 1%, for financial instruments of real security rights, pensions, bonds, loans and cession of credits.
  • Leases are governed by the scale of tax fixed by Law.

* With effect from January 1, 2015, tax rate offsets will be applied in the creation and exercise of purchase options in lease agreements related to certain payment operations.

Budget 13 – 15% on top of Property Purchase Price

In addition to the taxes there is also the need to pay stamp duty for new builds on the pages notarised for the Title Deeds, as well as general application of Notary’s fees, Land Registry fees and Lawyer’s / legal assessor’s fees (Gestor).  These days, most mortgage set-up costs are assumed by the lender. As a rough rule of thumb, allow 13% – 15% on top of the Purchase Price and note stamp duty for new builds.

Disclaimer: TMT Spain Real Estate has provided this information as a general guide only and it must not be relied upon in place of legal advice. Legislation is constantly updated and the reader must satisfy herself/himself of the accuracy of these contents.


“The ache for home lives in all of us, the safe place where we can go as we are and not be questioned.” 
Maya Angelou

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