BUYING REAL ESTATE - INTRODUCTORY THOUGHTS
When we decide to buy real estate in Marbella, we must take into account that although there are many similarities between the Hungarian and the local markets, there are also differences that are worth paying attention to. In this post, we summarize the 10 steps of the purchase and what to expect in each phase.
The first noticeable difference is that on the Costa del Sol it is difficult - almost impossible to search in a database where owners upload properties directly and buyers can choose and ask questions of the seller. Although there are public sites, e.g., idealista.com, Yaencontre.es, Pisos.com, but the ads are not updated, properties that have been sold and released long ago are listed on the pages, and you can find dozens of copies of the same property, with the data of 10 different "owners". It's no wonder that the buyer doesn't want to search on his own, he doesn't get the standard of ingatlan.com, which is usual in Hungary.
A significant number of foreign owners spend only weeks or less on the Costa del Sol, so if you decide to sell your property, entrust it to a real estate agency, of which you can find several on every street corner. Almost everyone pretends to be a real estate agent in order to get a small cut of the commission. The doorman, the security guard, the gardener and often the old friend pull the realtor aside to see if he will give him some of his commission, because if not, he will dissuade his friend from buying with this realtor. Of course, the unsuspecting customer knows nothing about this, since the person he came to visit has been living here for a long time, the customer trusts him to know better who is worth working with here.
In this post, I will honestly describe how the process of buying real estate in Hungary and here on the Costa del Sol, in Marbella, is similar and different.
1) RESOURCES
This is one of the most important aspects for the buyer to have enough money, since if he still has to sell something in order to buy, then by the time he finally has enough money to cover the purchase price, the selected property in Marbella has already changed hands. Many people missed out on the home selected after several rounds of visits because they had not yet sold their other property. Mapping the regions and housing estates is useful, but even 3-6 months later, properties in the same zone will be available at different prices. Prices in and around Marbella increase by 4-5% per year, but in the last two years many properties have gone up by 30%.
2) CREDIT UPGRADING
Most people hear what they want to hear. When a real estate agency in a shopping center in Buda - which specializes in selling foreign properties - advertises that you can buy a luxury holiday home in Marbella with "up to 30% of your own money", people believe that this is possible for them too. However, the reality is that for those whose income is in HUF in Hungary, the repayment installment can be up to 50% of the value of the property and a maximum of 20% of the net salary (not dividends) for a maximum of 15 years.
On this link, you can read about loan options in detail
Those who go shopping in Spain in the hope that they can buy with minimal personal effort, I have to disillusion. The buyer must have at least 50% of the value determined by the bank. You can pre-qualify at this link:
Loan pre-qualification - without commitment
3) REAL ESTATE AGENCY
As I wrote in the introduction, there are many real estate agencies and even more "real estate agents" on the Costa del Sol. I put them in quotation marks because those who do not have any officially registered business and who may have just received an assignment for a property from a friend and are trying to sell it also claim to be real estate agents.
There are dozens of real estate portals in Spain, which are used by the majority of agencies. There are 2 widespread systems on the Costa del Sol:
Propertytop (which is the public page of the system called Inmobalia)
Propextra (which is the most common system, the Resales Online page)
99% of agencies work from these systems, for the use of which they pay thousands of euros per year as a system access fee. Move2Marbella is a subscriber to both systems, so that it can offer its clients the entire available real estate offer. In many cases, an individual search is also started, we also browse advertising portals and bank offers in order to find even more properties for sale for our clients.
It might not even be important to emphasize this, since the majority of ethical real estate agencies act in this way, but unfortunately there are those who try to sell those properties to their clients for which they receive a higher commission from the seller. This is strictly prohibited in my office, a customer-centric approach pays off in the long run, a satisfied customer is happy to recommend us to his friends.
4) FREE SWIMMER
Self-appointed real estate agents have already been mentioned. We already know that some offices try to attract buyers with properties that have been sold long ago and are no longer on the market. This is an old trick. Unfortunately, it is also true that people believe what they want to hear. a property has been sold, the buyer still lulls himself into the illusion that "if he still has it".
This is also used by a Belgian-owned office in the frequented location of Puerto Banus. When the interested person walks into the trap (although we tell him that it has not been on the market for a long time), the Belgian office confirms that they still have it. According to their claim, there are so many people interested that the buyer has to transfer €5,000 to their account, so they reserve it for him until he can come and see it. When the buyer arrives, they inform him that "unfortunately" it has just been sold, but don't worry, because their office will find another one and they already have the reservation for future purchases. This is how our poor compatriot was "chained" to the office. Some people charge a brokerage fee, up to 4% of the purchase price on top of the purchase price, but at least €2,000. There is also someone who drives around the zones in 4 hours for €200.
THE BUYER DOES NOT PAY A COMMISSION WHEN PURCHASING A PROPERTY ON MARBELLA!!!
5) VIEWS
After the real estate agency sends several real estate proposals by email or Whatsapp, the buyer selects the ones he wants to view. The real estate office arranges an appointment with the owners and, if the owner has entrusted another agent with the sale, with them as well. During viewings, the buyer, the representative of the real estate office, and the person who has the right to open the property must arrive at the same time. If the owner is currently in the property, then he himself, if not, then his authorized representative. Buyers are often surprised by how many people are present when showing a property. This is also why it is difficult to plan visits in such a way that you can see the properties every half an hour or three quarters of an hour.
If there is a slip in one, the daily program is overturned. Many times during the visits, it becomes clear how important the proximity to the sea, the garage, spacious spaces, etc. are, so you have to cancel the other appointments in the middle of the day. This is a bit unpleasant, when there are 4-5 places waiting for our arrival, the owners or other real estate agents easily label such an office as frivolous. And if the buyer got kicked out of the harness the night before and doesn't show up for the first meeting the next day, that's the most unpleasant thing.
Ideally, after a few viewings, both the buyer and the realtor know which is the ideal choice, and the moment arrives when the buyer wants to make an offer.
6) SUBMISSION OF AN OFFER
Making an offer is a kind of commitment. If the buyer wants to achieve a good price, he tries to bargain or announces a much lower price to the seller. The majority of sellers on the Costa del Sol are not inclined to significantly reduce the price. Either the seller or his representative does not take verbal offers seriously anyway. They ask you to describe the offer. In addition to the recommended purchase price, the written offer includes the method of payment (whether a loan is required for the purchase, for example) and the schedule.
In general, if you do not need to take out a loan to pay the purchase price, and the buyer can pay for the property relatively quickly, then a 3-5% negotiation is usually possible. There are already properties offered at an attractive price, with excellent features, in the case of which the owner does not usually give up, he knows that he can sell without a price reduction. Even this year, there is a demand market, more buyers arrive than there are high-quality properties on the market.
In September 2023, some banks introduced new regulations. In the following, we present the rules according to which non-Spanish residents can take out a loan.
7) DEPOSIT
If the owner accepts the written offer, he will also return it in writing and provide the details of his legal representative. In that case, it is advisable for the buyer to have a legal representative who checks the official documents related to the property. As a first step, the buyer must transfer €6,000 to his lawyer's escrow account. The lawyer sends a certificate of the amount received to the seller's lawyer and requests the property's title deed, real estate tax document (IBI), and the last paid joint expense invoice. After the lawyer has checked these, he informs his client about the status of the property and possible charges. If the buyer can't find anything to complain about, his lawyer transfers the €6,000 deposit to the seller's lawyer and they start drafting the deposit contract.
The seller asks the real estate agents who are still advertising the property not to advertise it any further, the property is placed in the "Sales Agreed" category, which means that both the buyer and the seller have agreed on the purchase price, it is temporarily not on the market.
8) 10% RESERVATION
The lawyers draw up the deposit contract, in which the buyer adds 10% of the purchase price to the previously transferred €6,000. In the reservation contract, the parties certify that by signing, the buyer acknowledges that he has paid 10% of the purchase price, and that if he withdraws from the purchase, he will lose this amount. And the seller undertakes that if he withdraws from the sale, he will repay double the amount received to the buyer. At that point, the buyer can rest assured that the owner will not sell the property to someone else. The owner can also feel safe, since the buyer has already committed himself. The reservation contract records the further payment schedule and the latest date for signing the final sale contract (Escritura).
9) CONTRACT
In the reservation contract, the parties agreed on the method of payment and when the buyer pays the seller the remaining part of the purchase price. The Spanish banking system is a little different from that of any other European country: the most common payment method is a bank cheque. This is a bill of exchange in which the issuer gives a payment order to his own bank so that the person in whose name he issued the check can cash it. The amount on the check is credited within 1-2 days by the bank to which it was issued. It's a strange feeling sitting in the notary's office holding a check for 2 million euros, which is "just" a piece of paper, but then and there it's worth so much. The notary checks the data and after signing, the buyer gives a check, the seller hands over the keys.
10) TAX PAYMENT
After the conclusion of the contract, the notary does not issue the original document, but instead provides a digital copy of it, which must be requested under the name COPIA SIMPLE. The lawyer's work is not finished here, as the utility bills (water, electricity, gas) must be transferred to the name of the new owner at the service providers. Another important task is to account for the amounts withheld from the purchase price both to the seller's lawyer and to the buyer. He settles any debts and pays the tax office the 3% non-resident tax if the seller is not a Spanish taxpayer.
The property registration tax must be paid within 45 days after the escritura (sales contract), which according to the current rules is 7% of the purchase price. The notary determines what the real purchase price is, regardless of the amount stated in the sales contract. This is also handled by the buyer's lawyer, who ensures that the determined amount arrives on time to the tax office's account.
As we have seen, this is a long process, which usually takes about 60 days from the offer to the conclusion of the contract. There are also faster transactions, the shortest can be 2-3 weeks, it is almost impossible to obtain all certificates sooner than this. According to the agreement of the parties, the longest can be several months or even a year, but it is not worth prolonging such deals, because if anything happens to the seller, the buyer will only have a private contract. (e.g. the seller dies) If an agreement has been reached between the buyer and the seller, it is primarily in the buyer's interest to have an official sales contract signed in front of a notary as soon as possible.
Share this article
