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Purchase Process in Spain

Below is the standard purchase process in Spain, and issues that may affect that purchase:

• An initial reservation deposit of between €3,000 and €6,000 is normally required, although this may vary depending on the purchase price.
• Once the seller has accepted your offer and you have agreed to go ahead with the purchase, the agreement needs to be put into writing. A private 'option to purchase' contract, or a sales contract, is prepared, along with the terms of purchase. These will be received and checked by your lawyer then they can be signed and exchanged.
• At this stage a deposit of 10% of the purchase price is required to be paid. This is non-refundable if you do not proceed with the purchase. Should the vendor decide not to proceed, it is normal for them to refund double the deposit.
• Finally, the deeds of purchase are signed before a notary in order to make the contract public and legal. The final payment is then made and the sale is complete.

The cost of a standard property purchase in Spain includes the following:

All percentages are of the purchase price.

• Property Transfer Tax (Impuesto de Transmisiones Patrimoniales/ITP) - Purchasers of re-sale property (as opposed to new/off plan property) are required to pay between 6% and 7%, depending on the region.
• Value Added Tax (VAT) (Impuesto sobre el Valor Anadido or IVT) - Purchasers of new property must pay 7% VAT, plus an extra 0.5% to 1.0% stamp duty.
• Notary and Registry Fees - These fees are fixed by law and are based on a sliding scale. They are approximately 0.5% to 2%, depending on the value.
• Title Deed Tax - Is 0.5% of the declared value of the property and is charged for the transfer of property title.
• Legal Fees - Either a fixed fee per hour (€100 to €250) or a percentage of the purchase price (1% to 1.5%), although legal fees are generally negotiable. VAT of 16% is added to all legal fees.
• Agent's Commission - Real estate agent's commission is now generally around 2.5% to 3%.

The Obelisk Advantage:

As Obelisk approaches its projects purely from an investment perspective, its priority is to deliver each real estate product with an emphasis on simplicity and transparency throughout the purchase process. Therefore, Obelisk has already identified the purchase procedure for its clients as a simple, four step process:

1. The client chooses and reserves the unit that best suits their investment requirements, and Obelisk takes the client through a compliance procedure.
2. An independent lawyer, sourced and appointed for the client by Obelisk, will have already carried out full due diligence on the real estate product. They will issue all purchase contracts and paperwork to the client.
3. On receipt of this contract, the client will sign and make the first payment. The lawyer will notify the client of all further payments when required.
4. The appointed lawyer will also represent the client in all aspects legally required within the country of purchase, ensuring that clients of Obelisk enjoy the benefits of simple and hassle-free real estate investment.