How to buy a property in Tenerife
The buying process in Tenerife
if you want to buy the home of your dreams in Tenerife, first of all you need to know some things.
Below is a quick explanation of the process and costs of buying a property in Tenerife.
If you need further advice or information, please do not hesitate to contact us.
In all the procedures described below, you will be accompanied and followed by expert personnel, without any additional cost.
Spain has a notary system that deals with the drafting and signing of the acts of buying and selling property, wills or powers of attorney.
The notaries are free to qualified professionals, and legitimated by the state.
The notary is, therefore, essential for the transfer of property, both the seller and the buyer shall, before the notary public, the delivery of the keys and the money.
The notary has the function of monitoring and attest (via notary) that the transaction has taken place and is legal.
Another task of the notary is to verify that the property of the seller is legitimate, that we are all the transcripts of the sale of the property, that it is free of mortgages and that does not have unauthorized building.
If you do not have the opportunity to be in Tenerife to the person at the time of the signing of the act, then you can draw up a power of attorney in favour of a third person who will represent you.
As A result of the act stipulated, the tax payable for the transcription are paid by the tax authority of the place, the deed is presented to the land register and are paid the cost of registration.
All costs, which include taxes, the cost of the Notary and land registry fees are the responsibility of the buyer.
To be sure you have sufficient funds to pay all the expenses, we recommend that you consider the costs equal to 10% of the price of the property.
Any payment greater than the due, will be returned when the recorded deed will be returned (about 60 days later).
Registration tax: You pay the 6.5% for the properties of the second-hand and 7% on new properties.
Notary public: This price can vary depending on the value of the property, and should be between 500 and 1000 Euros.
Land registry: the new property must be registered in the territory of the local authority and the cost should be between 250 and 500.
Do not forget that, in addition to the expenses mentioned above, you will have the costs of maintaining your property and not have any problems with the law. These include charges for utilities, local and national taxes and service charges (if the property acquired is part of a condominium).
The most common costs are:
Water: This is usually paid directly to the supplier of the water and you pay according to consumption.
Energy supply: This is normally paid directly to the Company that provides Electricity and this is charged according to consumption.
Waste: This is usually paid directly to the municipal authority and is paid annually or half-yearly, depending on the municipality.
Property tax: this is paid annually, usually in may/June.
The rate depends on the size, location, and age of the building, and is currently equal to approximately 0.45% of the value.
Monthly expenses: This is a handling charge payable by the owners of properties that are part of the complex. The amount you pay will depend on the various structures and the characteristics of the complex, such as lifts, swimming pools, gardens, security, lighting, etc.
You should not forget to pay this expense, for the maintenance of your property.
Income tax: residents and non-Resident owners of real estate or shares in Spain are obliged to file annual income tax returns. The minimum rate of taxation is equal to 19% (2016). The income tax is applicable to rental income.