Property purchase in Spain, an option for the spanish residence permit
The new Law to Support Entrepreneurs and Internationalization (Law) allows a foreign investor to obtain a specific residence permit (Golden Visa Spain), which permits the foreign investor and his or her family members to live and work throughout the Spanish territory.
To receive this residence permit, the foreign investor must choose an investment of the various types that the Law outlines.
An investment option of great interest is that of real estate, among others, because it is the optimum time to invest in real estate in Spain. This article will focus on the steps that the Spanish legal system requires for the purchase of real estate in Spain.
Pre-acquisition procedures include
Once a foreign investor has selected the specific real estate for purchase and before signing any documents, he or she should carry out the following actions with the assistance of legal experts in this subject:
- Check the ownership of the property and the possible existence of encumbrances or levies on the property. Legal experts can help a foreign investor by analyzing the title of the seller including the status of the property in the Spanish Property Registry.
- Inquire about any registration issues with the property.
- Consider town planning and licenses.
- Verify that payments are up to date within the Community of Owners when the real estate has common (shared) areas.
- Determine which tax is directly and currently levied on the property: the IBI or the property tax.
The signing of the purchase agreement
- The foreign investor must reach an agreement with the seller about the terms and conditions of the sale and then proceed to the drafting, analysis, and/or amendment according to applicable legislation. A private contract is not mandatory; a foreign investor can directly sign a public deed.
- The foreign investor must sign the public deed before a Spanish notary so that the purchase may be registered in the Spanish Property Registry and benefit from the protection that the System grants the purchaser. To facilitate the process, the foreign-investor buyer may have a third-party representative such as a lawyer. For this purpose, the foreign investor must sign the necessary authorization or subsequent ratification to proceed to purchase before a notary, which may be located in the native country of the foreign investor. It is also possible that the foreign investor seek this ratification before the Spanish consular authorities of the foreign investor’s native country, thereby streamlining procedures.
Procedures subsequent to signing
- The foreign investor must file and pay the tax on any property transfer that the purchase of real estate generates.
Thereafter, the foreign investor must register the title in the Spanish Property Registry.
- Finally, a statement to the Spanish Ministry of Economy will be submitted for statistical purposes.
Once these steps are completed, the foreign investor can enjoy the property and may initiate the necessary procedures for obtaining a residence permit.
This article is not considered as legal advice