So, you’ve found a Spanish property that you’d like to call your own and you're ready to make an offer and begin the negotiation process. Congratulations: Now is a great time to be buying property in Spain! What happens next? For many people who are buying their first property in Spain, the process can seem daunting, and very different from buying a property in the UK or elsewhere in Europe. But it doesn’t have to be complicated, as long as you follow the simple process outlined below.
With that in mind, here’s everything you need to know about negotiating the sales fee when buying a Spanish property:
Although some vendors may prefer that negotiations begin in writing, in the vast majority of cases, a verbal offer is the best way to start negotiations for your property purchase. If you do want to make an offer in writing, rather than verbally, you should write your offer in a language that the vendor will understand (it is likely that this will be Spanish) and ensure that it contains the necessary legal caveats: remember that any written offer is binding.
One of the main questions that buyers have when offering on a property, is what price they should offer. A good rule of thumb to follow is that you should never offer the asking price of any property: almost all vendors will list their properties with the expectation that the price will be negotiated. The key is to find the price that walks the fine line between being too high (where you could save yourself extra money) or insultingly low. If your price is too low then the vendor could choose to terminate the negotiations, and this will put you on the back foot if you choose to start negotiations again.
The best way to choose the right offer price is to thoroughly negotiate the market. Your estate agent may also be able to offer impartial advice on this. You should also remember that the price you agree is not binding until you have completed your due diligence and ensured that the property you are bidding for is everything you expect.
Note: Once you have a verbal agreement that has been agreed by both parties, we advise that you have your lawyer summarise the key points of this in writing and share them with the vendor. This will help the transaction proceed more smoothly in the long run, as everyone has agreed to the same terms and is on the same page.
Undertaking Your Due Diligence
Due Diligence is the formal term for the legal checks and any property searches that you want to undertake prior to agreeing to purchase a property. Buying property in Spain is always a case of caveat emptor (buyer beware): please don’t fall into the trap of failing to undertake your due diligence before you agree to buy a property, as you will have no recourse if anything goes wrong. For this reason, we would always advise that you secure the services of an appropriate lawyer to carry out your due diligence for you. What’s more, if you have any doubts about the structural or physical condition of the property, secure the services for a surveyor or an architect who can thoroughly check these for you.
If you take out a mortgage in order to fund your property purchase, the bank will carry out a certain number of these checks on your behalf. Don’t be afraid to use the results of these checks to further negotiate the price of the property with the vendor, or put the onus on them to right anything that could cause you problems in the future (a lack of building regs is a good example of this).
Ensuring the Appropriate Checks Are Made
Your lawyer will be best placed to advise you on the correct checks for your particular property purchase, but to enable you to approach the negotiation table from a more informed position, here is a list of the most common types of due diligence checks that you should expect to be carried out prior to your property purchase:
- Check the Vendors Title: This will ensure that the vendor or vendors have full legal ownership of the property and are in a position to sell it.
- Check that the property is free of debts, charges, liens and embargoes: The property should be sold free of any encumbrances. Any debts on the property, such as the mortgage, should belong to the vendors and not the property itself.
- Check that payments of local taxes (IBI) are up to date: You should make paying these taxes a condition of your purchase, if they are outstanding. Any outstanding debts would be your responsibility once you were the owner of the house
- Check the deeds: the deeds of the house you are buying should match what you see in front of you. If not, your lawyer should establish why not. And if any planning permission needs to be obtained after the fact, securing this should be the responsibility of the current vendor.
- Check with the urban planning department of the town hall: If you're not sure what constructions on the property are or are not legal this check will help to clarify the issue.
Are you looking for the ideal Spanish bolt hole? Hoping to invest in a Spanish home of your own? Then now is the perfect time to get in touch with our local property experts. They’re ideally placed to help you find the home you’ve been searching for and turn your dreams into a reality.