A simple guide to selling your property in Spain
Selling your property in Spain involves a number of obligations and costs that must be faced by the seller.
The general rule selling a property in Spain is that the purchase is made free of any debts, liens and encumbrances, being up to date with payments and taxes, and free of tenants and occupants.
The current market conditions probably make it more of a seller's market than a buyer's market. Nevertheless, when we do get the qualified buyer through the door, you really want to maximise your chances of selling, rather than leaving it to chance.
Should a valuation be agreed and you decide to sell with VIP Almeria, we will create a listing in at least 5 languages’. Provide a commitment to ensure our professional adverts are with national and international platforms such as Rightmove, A Place in the Sun, Zoopla, Idealista, leading Irish platforms and our MLS partners in North & South America at no cost to you to offer some examples of our international exposure. We also attend a number of overseas property exhibitions introducing Costa Almeria to potential house hunters.
Our buyers need to be able to make an informed decision so we present a house in full transparency.
Remember, V.I.P Almeria is not only selling your house, but selling the type of lifestyle someone can enjoy by owning your house!
Let's cover a few of the selling basics and the sales process:
The Selling Basics (The Costs involved in Selling) when it comes to selling your property, you must take the following costs into account, otherwise you will end up with far less in your hands than you expected:
- Mortgage Cancelation Fees (if applicable): If you have an existing mortgage on your property you will need to pay about 1.000 Euros to ensure the mortgage is officially cancelled at the Notary and Registry Office. Often this amount is retained by the buyer for them to ensure the fees are correctly administered. You may also have some cancellation charges from the bank so make sure you check.
- Capital Gains Tax: CGT is set at a percentage of your profits. However, if you are non-resident, on completion 3% of your initial sales price will be retained as a partial retention for your CGT liability. Please note, it is the buyer’s responsibility to retain this 3% and pay it to the tax authorities on your behalf. If your profit is lower than this amount you can claim back the difference. If it is higher, you should pay the balance to the Spanish taxman within 2 to 3 months after the sale.
- Plus Valia: Impuesto sobre el Incremento del Valor de los Terrenos de Naturaleza Urbana. The plusvalia is a local (municipal) tax charged by the town hall on properties when they are sold. It is calculated on the rateable value of property and the number of years that have passed since the property was last changed hands. The objective is to tax the increase in the value of the land on which the property stands, some of which is due to improvements to the area carried out by the local government and the community at large.The base for this tax is the valor catastral (an administrative value that is usually lower than the market value, sometimes considerably so) of the property. The amount due in tax will depend on how long the seller has owned the property: the longer the period, the higher the amount of tax.
Legally this is paid by the vendor. The Plus Valia must be paid within 30 days of the completion of your sale.
- Ensure all your community fees, IBI (rates) and utility bills are up to date. If any of these bills are not up-to-date the buyer may insist on retaining any outstanding amounts due from the sales price.
- Legal Fees: If you choose to use a lawyer to help you when you sell, the conveyancing fees will be about 1% plus IVA / VAT.
- Real Estate Agents Fees: We are a regulated agent so we will always advise you of a simulation before selling your property at an agreed price, so you know exactly where you stand tax-wise and this service is included in our fee. We also pay all of the marketing on a no sale / no fee basis. Our fees can be discussed upon a valuation agreement. We compile all the papers as part of our fee which includes arranging all certificates for the property free and clear of encumbrances. It is clear what we are selling however we must provide this clearly and in Certs to the buyers Legal Rep.
- Typically, our fees depend if it is exclusive, at a discounted rate or multi agency, we request a commission fee match.
Always consult your lawyer or tax advisor before selling your property, so you know exactly where you stand taxwise.
We will require sellers to be aware that we adhere to the Decreto 218/2005 which requires us as an agent to be in possession of a copy of the property documentation to market and sell your home.
For VIP Almeria to get the paperwork together, all we need is a signed listing agreement in place. We will be happy to assist you with the paperwork and arrange the certs. It must be clear what we are selling so it can be presented to a buyers legal.
In order to do the necessary due diligence, We would need copies of the following:
- Deed or Copia Simple
- Nota Simple (We can request this upon receipt of the deed)
- EPC - Energy Rating Certificate (We can request this upon receipt of meeting the Decree 218)
- Last two years IBI Receipts (Not the Direct debit)
- ID of vendors (NIE and Passports)
- Copies of the Rubbish, Water and Electric Bills (Not the direct debit)
- If a community based property, we will need the contact details of your administrator.
Feedback and Communication for exclusive clients:
As a vendor, we would also offer you your own login area on our system where you will find all scheduled appointments, visit, activity and the traffic we generate. If this is all agreeable, we would welcome an appointment to take the photos and then we will take care of the rest. You will have good communication where you can log in with your own password that you create. Try to use the password strength above 70% by using a capital letter and number please. If you use this system you will find it will have a list of clients who booked appointments, scheduled viewing feedback and more.
When we market the property, what happens next?
You will receive an email from our system inviting you to create a password to log into the vendors site: In this section you will find the following information:
An update on your property performance. The report shows how your property has been performing and is a way of keeping you up to date on how we are marketing your property via the VIP Almeria site. Please note that we do not include the stats of any of the national or international portals in our figures.
How much interest is your property getting?
The stats show the amount of views your property has received on the landing page of your unique reference over the month. That means the number of visitors who have landed on your property’s full detail page.
This report helps us understand the level of interest your property has received, particularly when compared against other properties’ performance. Essentially, the more times your property’s full detail page is viewed, the more likely we are to receive an enquiry from a buyer directly.
Why does a property’s performance change over time?
When a property is first loaded to the VIP CRM, it is sent out in alert emails to potential buyers who are looking in our area. Due to the large numbers of clients in our system, when we send the mailshot out, if not sold in the first 6 weeks then you may see a fall in views after this initial spike, so it’s then about us working with you to generate as many detail views as possible by keeping the advert fresh and regularly checking that its price is in line with the market.
The performance highlights any changes we have made to your property listing and the subsequent impact of those changes on the number of people viewing your property’s detail page.
Selling your home In Spain? Make an informed decision (*Article assisted by Raymundo Larraín Nesbitt ©)
Options on how to mitigate a seller’s Capital Gains Tax (CGT) liability:
- All tax residents over 65-years-old are exempt from paying CGT when selling their main residence / abode ( this is the term "vivienda habitual", in Spanish legal jargon).
Any resident seller under 65-years-old is exempt from paying CGT on selling their main home providing all the following conditions are met:
- Seller is under 65 year-old.
- Seller is (tax / fiscal) resident in Spain.
- The property must be his / her main home (i.e main residence and must have lived in it permanently for the 3 previous years - proof required such as providing the “Certificado de Empadronamiento”).
The Empadronamiento, also known as the Padrón Municipal de Habitantes, is a municipal register or census record, similar to an electoral roll. To register on the Padrón is to “empadronarse“. Registering on the empadronamiento places a resident of a town on the list of local inhabitants.
- It may be less than three years under exceptional circumstances i.e. job change, marriage or separation.
- Sales proceeds are reinvested in a new main home (in Spain or else in the EEA/EU). Any sales proceeds not reinvested will be taxed pro rata.
- There is a two year deadline to reinvest the sales proceeds (on a new main residence).
Pension annuities – Always consult your accountant for up to date information:
This third tax relief is in addition to the above two main home tax reliefs and applies to residents.
Any capital gains made by resident taxpayers over 65-years-old will go untaxed provided the following are met:
- Sales proceeds reinvested in pension annuities.
- Capped at €240,000.
- Six-month deadline as from sale.
The traditional method
Your Abogado / Accountant can offset from your CGT liability on selling, all expenses that went towards buying the property plus any refurbishment costs, provided you have VAT invoices to back them up. It is also advisable to show proof of payment such as Bank transfer receipts. Applies to both residents and non-residents.
- Legal fees (when purchasing originally).
- Notary fees (on buying).
- Land Registry fees (on buying).
- Taxes / Transfer fees (on buying).
- All property-related improvements (however not maintenance costs) i.e. glass curtains, refitted kitchen, roof retiling, wood flooring, A/C, house alarm etc.
*Article and information kindly provided by Raymundo Larrain who is a Spanish lawyer that is a specialist in conveyancing, taxation, probate and inheritance cases for ex-pats in Spain - https://www.larrainnesbitt.com
If you wish to make an informed decision to sell, Contact VIP Almeria. We offer the most competitive fees in the market and it is always No sale / No fee. firstname.lastname@example.org