Any island based estate agent will tell you that there’s “too much product out there at the moment”. An over supply of property for sale in Lanzarote which has been created by the growing credit crisis, falling pound and weakening consumer confidence in key overseas investment markets such as the UK. But over supply and declining demand is not the whole story. As certain types of property are still generating interest, enquiries and sales.
All property in Spain should be registered in the Registro de la Propiedad (the land registry), where you can obtain the full details of the owner, the exact size of the property and full details of any mortgages, debts or judgments against the property will normally be registered. Only the persons or company named on the Escritura Publica, the title deed, have the right to sell the property, unless a notarised power of attorney has been given to a third party.
Ups:
A slow down in construction has led to buying opportunities. From the Financial Times.
A couple transforms a building on the Greek island of Poros. From the New York Times.
Spain’s soaraway property market has ended its decade-long boom, new figures show, with prices falling for the first time in many parts of the country.
In the country as a whole, prices inched up by just 0.3 percent in the third quarter of the year, the smallest increase since 2000. But prices fell in 13 of Spain’s 50 provinces, including many popular with British homeowners.
Spain and Ireland are set for a prolonged slowdown in economic growth, according to Standard & Poor’s, as a drop in construction activity and consumer sentiment hits labour markets and weakens public finances.In a report published on Monday, the credit rating agency says house prices in the two countries – and the UK – are about 20 per cent overvalued and on the verge of a “protracted correction”.The impact of this on the broader economy would be more pronounced in Ireland and Spain, whose “economies are heavily exposed to the direct effects of the housing market slowdown on the construction sector”, says Standard & Poor’s. Construction accounted for 12.6 per cent of the total employment in Spain in 2006, compared with a European Union average of 8.2 per cent, it says.In Spain, unemployment in the construction sector has surged 53 per cent in the past 12 months, helping to fuel a 22 per cent increase in the number of immigrants out of work. Scores of small builders and property agents in coastal areas have gone out of business, and there are concerns about rising bad loan rates at some regional savings banks. House sales in the second quarter this year were 11 per cent lower than in the first three months, according to government figures.While acknowledging the downturn, the Spanish government has consistently played down its implications for the wider economy. Officials say their main worry at the moment is the impact of a broad slowdown in Europe on the country’s export and tourism sectors.More on Warning on building slowdown
This is a guide to the ongoing costs involved in owning property in Spain.
Running Costs
All bills must be paid by Direct Debit from a Spanish bank account.
Electricity, Water and Gas:
The standing charges are € 15 per quarter for water, and € 15.84 every two months for a 3.3 1Kw electricity supply. On top of this there is, of course, the actual consumption.
As gas is supplied in bottles it is possible to contract for 1 or 2 bottles. The cost for 1 is approx. € 42, and for 2 apprpx. € 66 Euros. Exchange bottles cost approx. € 6, and can be obtained from Repsol Butano or delivered to the client’s property.
The following are the costs you should include on top of the purchase price when buying property in Spain.
Lawyers/Solicitor’s Fee:
Although it is not compulsory to engage a solicitor, if you are not familiar with the procedure you can appoint your own solicitor. It is important to seek professional advice from a local solicitor (Abogado). Their standard fee for the purchase of a property is 1% of the purchase price plus VAT. Using a non-local solicitor will be more expensive. The Spanish legal system is very different from other European countries and, to avoid misunderstandings, disappointments and possible fraud, it is essential to seek expert professional advice from the beginning.
Notary Fee:
These are collected by the Notary after preparing the deed and presiding over it’s signing. This fee is fixed by law, on a set scale according to the property value, but is not usually more then 1% of the purchase price including VAT.
Not too long ago, the average Briton could buy a flat in Spain, declare the property uninhabited, rent it out to whoever he felt like and avoid paying a penny in tax to the Spanish government.
