CLICK HERE TO SEE A YOUTUBE PRESENTATION
Under the Law 14/2013, of 27 September, on support for entrepreneurs and their Definition From the 27 of September 2013, citizens not residing in the EU also have the possibility of applying for a residence permit in Spain, with which they can move freely through the 27 countries of the Schengen area. For this, they must invest, at least, 500,000 euros of own capital in a property in Spain. Amounts over 500,000 euros can be financed with a mortgage. The residence permit is also valid for the spouse and minor children, as well as for the parents of the investor. Being required to pay taxes as non-residents; the minimum length of stay is not limited. So, You may obtain a residence visa, and afterwards a residence permit, if you invest at least €500,000 in Spanish property (one or more), provided that at least the minimum investment amount is unencumbered (mortgage free). You may conduct the investment after your residence visa application is approved, provided that you have transferred the funds to Spain and concluded a sales and purchase agreement with guarantee of compliance prior application. Investment may be carried out by your non-Spanish company, provided that is not incorporated in a considered tax haven. You must own, directly or indirectly, the majority of its voting rights and the right to designate or remove the majority of the members of the board of directors. The residence visa is valid for 1 year, during this year you may apply for a temporary residence permit which will be valid for 5 years, provided that you still keep the investment. Your spouse and your unmarried dependent children may be included in the application. To maintain your residence status, you will be required to visit Spain at least once per year. After 5 years holding the temporary residence permit, you will be eligible for permanent residency. For residents under this scheme, no physical residence or place of abode is required to apply for a PR status. Note that the 1-year residence visa does not count in this 5-year period! The permanent residency will entitle you to live and work in Spain indefinitely. After 10 years of legal residency (temporary or permanent) you may be eligible for naturalization. To become a Spanish citizen, you will be required to commit to renounce your previous nationality, have financial stability, no criminal record, attend to an interview and prove your degree of integration into Spanish society, e.g. knowledge of Spanish language, culture, values and participation in Spanish social activities!
Setting a price on your own villa or apartment is a very emotional thing In this article I will give you some objective ways to give you an indication of your property value.For the region Alfaz del pi, La Nuca and Altea. You will also understand that this method is a general valuation, without taking into account a number of extras such as sea view, 100% privacy etc ... Valuation for a second-hand villa. Through the order of architects, I can easily request the average sales price of the last villa sales this year. This average price is the selling price where villas of + 500K and sales below 100K are retained. For my region I will come to the following prizes (July 2018) ALFAZ DEL PI 1.767€/m2 LA NUCIA 1.552€/m2 ALTEA 2.146€/m2 If the price in your head deviates a lot from this objective valuation, it is good to ask yourself ... why? Keep in mind that these m2 prices are average prices. There probably are also villas sold in Alfaz for 2.000€/m2 with new bathrooms, new kitchen, sea view and 100% privacy. Also included in this average price range are villas from 1960 - 1970 maybe for 1,300 €/m2. This is due to the need to renew everything. The old aluminium windows with single glazing, no heating or air conditioning, orange flower motifs in the bathroom and kitchen and a pool in old-fashioned white square bathroom stones of 10x10 ... .etc. Conclusion: Demolition. A well-priced second-hand villa has double glazing, central heating everywhere, air conditioning in the bedrooms, a modern swimming pool with mosaic, a garage, a modern kitchen, 3 bedrooms and 2 bathrooms and preferably 180m2 in size on a plot of roughly 1000m2. A second way of calculating an indicative sales price is to ask the question ¨ For how much could I rent this villa to tenants? Know that there is a relationship between the rental price and the purchase price. This ratio is 5% Example: If I purchase something of € 300,000 as investment, I want at least 5% gross return ( Rent) 300,000 € x 5% = 15,000 €: 12 months = 1250 € rent per month. Is this a realistic rent I could ask for this villa? So if we apply both calculations to a second-hand villa of 180m2, we find the following results ALFAZ DEL PI 1767€/m2 x 180m2 = 318.000€ rent = 1325€/month LA NUCIA 1552€/m2 x 180m2 = 279.360€ rent= 1164€/month ALTEA 2146€/m2 x 180m2 = 386.280€ rent= 1609€/month Valuation for a second-hand apartment For an investment in a second-hand apartment, my 5% rule actually applies even more for apartments than for villas. This is because apartments are bought much more as investment property to generate ROI with rents With the same method we will now do the valuation for an apartment of 90m2 ALFAZ DEL PI 1926€/m2 x 90m2 = 173.340€ rent = 720€/month LA NUCIA 1553€/m2 x 90m2 = 139.770€ rent= 580€/month ALTEA /ALBIR 2286€/m2 x 90m2 = 205.740€ rent= 850€/month As a seller, one can ask the question, why would someone buy my apartment, if the (rent) yields only reaches a 3%? Do you know what the rents are in your neighbourhood? If the seller wants € 200,000 in La Nucia, but the average house rental price is only 500 € in the neighbourhood, then the gross ROI gives a 3% return!? From this 3% ROI you still need to pay the community fee and property tax!Or the rent is to low, or the sales price is to high! You can choose... Conclusion: Average values are what the name says. If your asking price is higher than this average price in Altea, Alfaz del pi or La Nucia, wonder why? It could maybe have a good reason. Is your estimate based on emotion or is it based on facts! If you want to sell a house, and you want an honest market price, let yourself be advised by people with experience.Copyright : Walter Matthyssen
What if you want a mortgage? More and more, Spain is coming out of the financial crisis and banks are starting to allow again mortgage loans. As a financial advisor I have access to a number of banks in Alfaz del pi, Altea and La Nucia to help you with your mortgage application. What are the main rules that you need to know? 1) As a non-resident you will generally receive 70% LTV ( Loan to Value) . It is important to know: which value! A mortgage application always includes an valuation report. That report, for example, will estimate a value for the villa of 300,000 €. If, however, you can get the villa cheaper, let us say 280.000 € then the bank will base its 70% LTV on the 280.000 € and not on the 300.000 €. There are banks that do let you know whether the mortgage is granted before you have to make the cost of a valuation report. 2) You can only spend 35% of your income on loans. This also takes into account any existing loans that you have now. 3) The term of a mortgage loan is maximum until your 70th birthday. The standard is a mortgage loan for 20 years. 4) The interest and conditions of a loan at La Caixa Bank (18 Aug 2018) 20-year Mortgage: Fixed interest of 2.35% 100,000 € @ 20 years (240 months) = 522 € 200,000 € @ 20 years (240 months) = 1044 € Keep in mind that there are a number of additional costs such as registration, register, the notary fees, the gestor etc. Count on a 2% cost of it borrowed amount. Advice: if you want to buy a villa or apartment with a mortgage, then count on the net purchase price approximately a cost of + 13% These 13% are composed by the property transfer costs (10%) + mortgage costs, notary, registro etc .. Ask us for a quote! Copyright Walter Matthyssen
When buying a property in Spain you will have to deal with various aspects such as taxes, registration costs, but also fixed costs such as community costs, etc. Due to the rapidly changing regulations within the EU it is not easy to give a standard manual. We will explain the procedure and our services transparently with this manual. You do not need a lawyer if you have a professional behind you! If you have found a house that you want to buy, it is of course the custom that you make an offer. Once you and the seller agree on the purchase price and the day of purchase, we make a purchase contract. You must also deposit 10% advance as a deposit on our third-party account to seal the purchase. (later you will see why this is important) Of course, buyers often do not have the 10% in their pockets or sometimes even not in their ( Spanish) bank account. That is why a 3,000 € is usually deposited immediately, so that the property is removed from the website. Then you have two weeks to deposit the remainder of the 10%. From now on, real work will start! 1) Before you can sign any document or Notary deed for purchase or even open a bank account with a Spanish bank, you must apply for a NIE number (Numero de Identificación de Extranjeros) as a foreigner. Do not worry, we do that together. No problem. 2) With this NIE nr we will open a bank account with a Spanish bank of your choice. This is because you can only bring € 10,000/person legally across the border. The money must therefore be transferred from your Dutch or Belgian bank to the Spanish bank. For English buyers we offer a really good deal with a foreign exchange company that leave the tremendous high bank costs aside Later, at the notary, you will notice that you have to bring a guaranteed bank check for that purchase in order to conclude the purchase. Unlike as in a lot of countries, Spanish notaries do not have a third-party account to park the purchase money prior to signing the deed. "Spain is different" 3) We will now request a "Nota Simple" from the property register to see if there are no debts or mortgages registered on this property. If a mortgage is registered, we will notify the bank to pay this mortgage before signing the purchase deed. We will then ask you as the buyer to reserve a bank check for the exact amount of the outstanding loan (debt). For example, it can also be a tax debt that is registered! No problem here either. You take care to reserve a check for these taxes, or the owner pays his taxes in advance, or we, as a broker, pay those taxes from your 10% advance that you have paid us. All owners are mentioned on that Nota Simple. This is important to know if a death has occurred, and the inheritance tax may still have to be settled. No problem, we have also that procedure in our hands. 4) Construction violations: on the "Nota simple", which is a shortened representation of the deed (Escritura), the dimensions of the land and of the dwelling are also shown. Usually with an apartment that is not a problem, but older houses often have attachments that do not appear in the deed, and are therefore "Illegal" at the moment. This is only a matter of legalizing. The costs are for the seller. Do not be frightened by this word "Illegally" we have the procedure in hand to legalize it. No problem. If it is really illegal, we will not sell it! 5) If you buy an apartment, we ask the relevant administrator the document that the seller stands even with the payment of his community fees. For example, has that account already been in debt for let´s say two years and there is a debt of, for example € 2000, no problem, either the owner will pay for it in advance and he will show us the proof of payment, or we will pay this debt from your 10% advance! 6) If the seller is a "Non Spanish resident" (Dutch, Belgian or English for example), the tax office has a surprise for you! As a buyer you are obliged and responsible to withhold 3% of the agreed sales price and send it to the tax authorities (Hacienda) Do not worry, we will do this for you, through our lawyer, who will also provide you with the relevant tax certificate that it has been paid. 7) Speaking of Hacienda, or the tax authorities: The seller must pay a certain (local) tax on the sale of his property. This tax is called "plus valia" If he does not pay it, it will come on your head as a buyer afterwards. Do not worry "Either the seller will show us proof of payment of this plus valia at the SUMA (Tax collector office ), or we will pay the plus valia from the 10% deposit that you paid. Owners must also pay IBI in Spain (Impuestos Bienes Inmuebles) this is the property tax . Here too we want to see from the seller whether it has been paid or not. If not ... we pay it from the 10% deposit. You start now to understand that your 10% advance on our escrow account is the safety for you to ask the seller for all payment receipts, otherwise we will pay it for him and secure you from problems. 8) We want the latest invoices of all utilitie bills, so that we can put these utitilties on your name after the sale (water, electricity etc) 9) If you want to work with a financing or mortgage. We can help you with that. In short. You can borrow up to 60% to 70% at a Spanish bank with a maximum term up to your age 70. You can spend 30% of your income on a loan. My experience: do not count too much on it, the banks are quite "conservative" in accepting your loan application. But it must been said: more and more cases are been approved lately. 10) WE FINALLY GO TO THE NOTARY! On that day, it is up to us, brokers, to hand over a complete file to the notary in such a way that it can be establish that everything is in good standing. In the absence of the right documents, everyone can go back home and do his homework again! (To give you a practical example, the expiration date of the buyer's passport was exceeded, and the purchase did not go through that day). If there is a mortgage on the house, the bank will first be paid (with your check) and then the seller can sell for "Free and encumbered ". 11) Transfer tax and notary fees: The transfer tax in Spain is 10%. But on top of that you have to count the registration of the deed (We do this) and the notary also wants to earn something himself. So you can count on an 11% to 12% in total for all these transfer costs + Notary + register. Since the notary is not a tax collector office, you also transfer that 11% to our lawyer who will again give you the relevant tax certificate. So in total you transfer by bank transfer to our lawyer the 3% non resident tax ( if applicable see point 6) and the 11% transfer tax. 12) After signing the new title deed (escritura) by the notary and all parties present, you will be handed over your title deed and the keys and you hand over to the sellers the bank check of the remaining amount. 13) CHAMPANGE NOTE: Do not let this detailed description be a reason for "Do it yourself" adventures. There are still many small and minor pitfalls on the road that can cause you financial damage and headache . Let yourself be guided by a professional! Copyright: Walter Matthyssen