Guide – Selling Process of a Property in Spain as a Non-Resident

Guide – Selling Process of a Property in Spain as a Non-Resident.

Selling a property in Spain involves several steps, and the process is quite similar for both residents and non-residents. However, there are some additional considerations for non-residents. Here’s a comprehensive guide:

1. Obtain a NIE (Número de Identificación de Extranjero): The NIE is a tax identification number for non-residents, essential for any financial transactions in Spain. You can apply for it at a Spanish consulate in your home country or in Spain at the Directorate-General of the Police. The application process involves filling out a form, providing a valid passport, and sometimes proof of why you need the NIE (such as a property sale). The NIE is crucial for opening a bank account, paying taxes, and conducting any legal transactions. It is advisable to apply for the NIE well in advance of any planned transactions to avoid delays.
2. Find an Estate Agent: While not mandatory, using an estate agent can be highly beneficial. They can help you accurately price your property based on market conditions, market it effectively through various channels, and handle negotiations with potential buyers. Estate agents have access to a network of contacts and marketing tools that can expedite the selling process. They can also provide valuable advice on how to present your property to attract buyers, including staging tips and minor repairs or improvements that could increase the property’s value.
3. Advertise the Property: List your property on online property sites, such as Idealista, Fotocasa, Rightmove; local newspapers (Sur In English, The Olive Press, etc), and real estate portals (A Place in the Sun, My Spanish Property Finder, etc). High-quality photos and detailed descriptions can attract more potential buyers. Consider offering virtual tours to appeal to international buyers who may not be able to visit in person. Effective advertising should highlight the property’s best features, such as location, size, amenities, and any recent renovations. Additionally, providing information about the local area, such as schools, transport links, and community facilities, can make your property more appealing.
4. Appoint a Solicitor: A solicitor will assist with the legal aspects of the sale, including drafting contracts and ensuring all paperwork is in order. They can also help navigate any legal complexities specific to non-residents, such as repatriating funds. A solicitor can conduct due diligence to ensure there are no legal issues with the property, such as unpaid taxes or disputes. They will also handle the transfer of funds and ensure that all legal requirements are met, providing peace of mind that the sale is conducted correctly.
5. Appoint a Notary: The notary oversees the signing of the title deed (Escritura de Compraventa) and ensures the transaction is legally binding. They verify the identities of the parties involved and the legality of the documents. The notary also handles the registration of the sale in the Land Registry. This step is crucial as it provides legal certainty to both the buyer and the seller. The notary ensures that all taxes and fees are paid, and that the property is free of any encumbrances or liens.
6. Get Your Documentation Ready: This includes: *Title deeds: Proof of ownership of the property; *Receipts for local municipal property tax (IBI): Evidence that property taxes are up to date; *Utility bills: Proof that all utility payments are current; *Community statutes (if applicable): Rules and regulations of the community where the property is located; *Energy efficiency certificate: Required by law, this certificate provides information on the property’s energy consumption; *Zero mortgage balance certificate (if applicable): Proof that any mortgage on the property has been paid off. Having all this documentation ready can streamline the selling process and avoid delays. It is advisable to gather these documents early in the process to ensure everything is in order.
7. Sign the Deposit Contract: Once a buyer is found, a deposit contract is signed, and the buyer pays a deposit (usually 10% of the purchase price). This contract outlines the terms of the sale and the responsibilities of both parties. It is a crucial step that secures the buyer’s commitment. The deposit contract typically includes details such as the purchase price, payment schedule, and any conditions that must be met before the sale can be completed. It also specifies the consequences if either party fails to fulfill their obligations.
8. Complete the Sale: The final step is the signing of the title deed (Escritura de Compraventa) before a notary. The remaining balance is paid, and the property is officially transferred to the buyer. Ensure all payments are made through secure and verifiable methods. The notary will ensure that all legal requirements are met and that the property is registered in the buyer’s name. After the sale, you will need to settle any outstanding taxes and fees, and ensure that the buyer receives all necessary documentation.
9. Tax Implications: In Spain, non-residents who sell a property are subject to the Plusvalía tax, which is levied on the increase in value of the urban land from the time it was purchased to the time it is sold. This tax is collected by the local municipality and must be paid even if the property is sold at a loss. Additionally, non-residents are also liable for Capital Gains Tax (CGT), which is a national tax set by the government. It’s important to note that from January 1, 2023, municipalities have been granted the authority to increase the Plusvalía tax by up to 50%. Therefore, it is crucial for non-residents to consider these tax implications when negotiating the sale price of their property in Spain. Moreover, buyers are required to withhold 3% of the sale price and pay it directly to the Spanish tax authorities as a safeguard against the seller’s potential CGT liabilities. For detailed guidance, it is advisable to consult with legal and tax professionals who specialize in property transactions in Spain.

By following these steps and seeking professional advice, non-resident property owners can aim for a smooth and successful property sale in Spain. For more detailed information, you can refer to the comprehensive guides provided by experts in the field. Remember, selling property in a foreign country can be daunting, but with the right preparation and support, it can be a rewarding experience.

—
Disclaimer: This guide is for informational purposes only and does not constitute legal advice. Please consult a professional for advice tailored to your specific situation.

Would you like more details on any of these steps or need help with something, please contact us.