If you have taken the decision to put your Spanish property on the market, we'd like to offer some advice. People can think that solicitors are only useful when you're buying but sellers need their interests protected too.
Most people know that having a solicitor to protect your interests comes highly recommended when you're buying a property in Spain. However, there can be a temptation to skip the need if you are selling. After all what can go wrong? You already know everything about your property that there is to know and it's just a case of the buyer transferring the money into your bank account, isn't it?
It comes as a surprise when we explain to people contemplating selling that there are a few more hurdles that need to be successfully negotiated first. Although we are seeing many more houses selling than was the case eight years ago, the buyer is still, to some degree, spoilt for choice. Legal difficulties in their way can call a halt to the process and a buyer might look elsewhere for a more straightforward property purchase.
On occasions we've found that the seller becomes sidelined during the selling process. The buyer is usually equipped with a solicitor who will check that their interests are protected. Where the seller is not represented then it's hard to be sure that arrangements suit both parties. For example, the seller should be clear about and in agreement with who holds the deposit whilst the final contract is prepared and signed.
Remember, the selling price is not what you will see in your bank account when the sale is completed. There may be a number of retentions for example, for the cancellation of your mortgage or legalisation of building works. If you are a non-resident you will have 3% of the sale price retained whilst your capital gains tax is sorted out, if applicable. Every seller must pay Plusvalía which is the tax paid to the town hall on the increase in land value. Currently there are changes to this being implemented and we will keep you informed of developments.
Knowing how much of the final price will find its way to you is important, particularly when you have further commitments that you've earmarked the money for. Below we outline ten pieces of advice that we think it's important sellers should follow to ensure that the process goes smoothly.
Our ten tips
- Make sure that there will be no legal difficulties that might deter your purchaser from buying your property
- Make sure that you have your Energy Efficiency Certificate in place
- Calculate how much Plusvalía there will be to pay
- Make sure that the contract represents your interests as well as the buyer's
- Ensure clarity about where the deposit money will go when it's paid
- Make sure that all the necessary documents are in place for contract signing – you don't want everything to halt because the right paperwork isn't available
- Check the final balance prepared by the purchaser's solicitor and verify any retentions that have been made. Make sure no money is being retained ‘just in case'.
- Calculate capital gains tax due, if any
- Non-residents should calculate what the 3% retention will be and ensure that there are procedures in place to collect it once it is released.
- If you are not fluent in Spanish, take a translator with you for the signing to make sure that the sales deed reflects what was agreed
If you do employ a solicitor to act on your behalf then these steps should be part of their brief and you can ask if they have been completed. At Ábaco, we implement them as a matter of course with every sale we conduct.
With a solicitor beside you there should be no surprises when you finally receive your banker's draft from the purchaser and hand over your keys.