Very nervous beginner
 

Hi

I have been ushered to this forum from tripadvisor. I am starting to consider possibly buying a holiday apartment in the Mojacar region of Almeria and I really could do with some advice on where to start. I’m looking to go out for 3 weeks this July and arrange some viewings, but other than that I just don’t know where to start! Do I contact a mortgage broker here in the U.K. do I need to open any special bank accounts or get any special account numbers. I am happy to take the process slow and steady and set bits and bobs up before going out in July but just don’t know where to start and feel overwhelmed.

Please any advice would be sooo appreciated as it feels quite lonely starting things off with no knowledge.

Hope to hear from some of the members soon.

Re: Very nervous beginner
 

Hi welcome.

I’m in Canada so no idea on Spain. But I think my only question is are you sure about it being Spain? You’re not likely to reconsider and go to Italy, France or wherever?
If you’re sure I would find out what the criteria are for owning property in Spain. From a legal stand point and taxes. Also check if there may be a difference if you’re a non resident.

Just some thoughts 😁

Re: Very nervous beginner
 

You can't borrow on a mortgage with the loan in one country and the property on which the mortgage is secured in another country - the banks can't handle the legal requirements and the mortgage paperwork in another country.

It is also very difficult to get a bank to lend you money, when your job, and income are in another country with respect to the bank and the property.

Unless you are a cash buyer, can get an unsecured loan in your home country (UK, presumably), or are financially secure enough to get a Spanish bank to lend you the money, then buying in Spain/ another country probably isn't realistic for you.

That said, I would be extremely cautious about buying a holiday home in the EU when the details of Brexit have not been finalized. You could end up with a holiday home that you can't visit as often as you'd like. .... I don't think a negative impact of brexit is likely, but I would caution against staking tens of thousands of euros on a bet that you won't suffer onerous restrictions on owning and/or accessing your holiday home.

Re: Very nervous beginner
 

I’m sorry, but that is not correct. People from all nationalities have been buying holiday homes in Spain long before the EU existed. Brexit will not change that at all. There are loads of Russians buying in Spain and the Spanish are more than happy to take their money.

Permanent residency - now that’s a different matter!

Re: Very nervous beginner
 

Hi and a warm welcome to the Spanish forum on BE. Myself and Fred James are the moderators for the Spanish forums whilst myself and BEVS moderate Europe. Please read the Site Rules http://britishexpats.com/site-rules/ adhere to them so that the site runs smoothly. Moderators are there to ensure that the rules of BE are maintained. This is so that members gain the information that they are looking for and find their experiences on the forums to be friendly and worthwhile.

Problems and complaints should always be addressed to a moderator who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are usually friendly and helpful with a wealth of knowledge about the issues of living in Spain. I hope that you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

Re: Very nervous beginner
 

Thanks for your reply, from having visited the area mentioned in my original post a number of times I am rather set on Spain. But thanks for your thoughts.

Re: Very nervous beginner
 

Wow I was lead to believe that I would be quite likely to be offered a mortgage in Spain, perhaps I have been naive? I don’t know if it’s right to contact a solicitor or mortgage broker in the UK first before going for the visit in July. I think I need a “step by step” idiots guide. í ½í¸†

Re: Very nervous beginner
 

Probably.
Well at very least you'd need a mortgage broker representing Spanish lenders.

But what happens if the euro strengthens and sterling weakens, by say an aggregate 20%? .... your euro-denominated loan payments rise by 20%! :eek:

And what happens if Brexit results in no subsidized Healthcare for British pensioners in Spain, and 100,000 of them decide to sell up and return to the UK, resulting in the market being flooded by low-rise end flats and homes in Spain? ..... Your flat may suddenly be worth 25% less than you paid for it!

In short, under your circumstances, I would not be buying in Spain, or any other holiday destination in the EU, until the dust created by Brexit has settled.

Re: Very nervous beginner
 

Hi has anyone heard and feedback about a group called MyLawyerSpain was considering giving them a call to see what advice they could offer me? If anyone has bought a holiday property in Spain I would be really keen to see what first steps you took and any traps/mistakes to avoid?

Re: Very nervous beginner
 

We were working, living and banking in the UK when we came over to Spain for four days looking at houses. Found a house after only two days and gained a mortgage from a Spanish bank the following day. However, that was in 2004 so things have probably changed since then.

Rosemary

Re: Very nervous beginner
 

Step 1 - Carefully review your decision to buy - taking into account some of the warnings above.

Step 2 - If you decide to go ahead - choose which part of Spain you want to holiday in, and if you are likely to want rental income, where other people might want to holiday. This may take more than one short exploratory trip.

Step 3 - Visit your chosen area and (preferably) stay in a rented accommodation near where your target is rather than an hotel and explore the area. Enlist the assistance of (hopefully) recommended property agents.

Step 4 - Having chosen your new property the next step is most important. Find a good trustworthy solicitor who speaks English (if you are not fluent in Spanish). DO NOT take advice on this from the estate agent or a property developer. Maybe come on this forum and seek recommendations.

Step 5 - arrange a Power Of Attorney (POA) for your solicitor - this will involve a trip to the local notary to get it signed off.
A good solicitor is worth the fees they will charge and can arrange most of the rest of what you need to do. They can get your NIE, open a bank account for you (although you will probably need to visit the bank in person to activate the account. Your solicitor will tell you what documentation you will need eg passport, statement of finances etc. Your solicitor may be able to assist you to get a mortgage from the bank.

Step 6 - Confirm your finance and make an offer to purchase - note a Spanish seller is less likely to take an offer than a Brit - they think that they will eventually get their asking price or better by hanging on. Brits are more desperate;). If the offer is accepted you will have to pay a non-refundable deposit (unless the seller defaults) Your solicitor will do all the land and property checks necessary and prepare contracts similar to the UK system.

If you need to transfer additional funds for the purchase you can either put in your Spanish bank account or into the solicitor's escrow account. If you will be making regular mortgage payments from the UK it is well worth taking out an account with one of the FX traders who can 'fix' exchange rates for periods or you will be at the mercy of currency fluctuations.

Once you have completed your purchase you will receive your escritura (deeds) from your solicitor.

Enjoy your new holiday home. Hopefully it will come fully furnished or you will have the fun of furnishing it. Note: it is almost always better to purchase locally than to bring stuff from the UK.
Think about how you might want to manage the property - particularly if you intend to rent out. Who will do the cleaning and maintenance, laundry and guest greeting etc etc. Very few properties are truly "lock up and leave" so you might want to have a property management company.

You will have to pay some taxes - IBI and Basuras (similar to council tax); if your property is a condominium or apartment or part of a complex you will have to pay some community fees. Don't forget property insurance which at least covers third party risks. You will have to pay some income tax - this is based on your actual income from rental or an 'imputed' amount based on the catastral valuation of the property.
Your solicitor can arrange connection of services - electric, water gas etc and set up direct debits to pay them.

I've probably missed out a couple of details and maybe other BE friends will fill these in, but this should give you a flavour of what to expect. Looks a bit daunting but it's good fun once you get started. After all it's in pursuit of a leisure activity and not life or death so don't allow Spanish bureaucracy to stress you out.

Re: Very nervous beginner
 

Hi there and welcome to the wonderful world of BE.

Hopefully all those that have seen it and done this exact same thing in Spain will all chip in to help.

I see MikeJ has started the ball rolling with an excellent post.
BE karma your way MikeJ.

A little bit envious as I would love to do something like this if we ever manage to extract ourselves from New Zealand and head back to Blighty/Europe.

Anyway. All the best. Good luck and I hope you have happy times in your hol home.

Re: Very nervous beginner
 

Can you borrow/increase your mortgage on a your UK property? If you need to borrow to be able to purchase this seems to me to be the best way as it takes away the risk of exchange rates etc.
Follow Mike J's post and get your Solicitor to do all the donkey work at the Spanish end.
Good luck

Re: Very nervous beginner
 

Three things about Almeria
1 Property prices are usually cheaper than most other parts of Spain.
2 Like some other parts of Spain, there have been illegal builds/modifications so do things by the book.
3 It is very hot in Summer.
As other posters have said the pound is low against the Euro and short of a dramatic "U" turn on Brexit, most people seem to think it will continue to fall further, so borrowing in pounds and paying in Euros will get more expensive.
Finally when you do decide to buy, get yourself a good abogado,and take his advice on Spanish beaurocracy, which can be difficult to say the least.
Pete

Re: Very nervous beginner
 

As far as I am aware there are UK lenders that will provide mortgages for UK residents to purchase property in Spain.DYOR.

Re: Very nervous beginner
 

Yes and even Spanish banks lend, but usually a 30/40% deposit is required for non residents these days. Buyer be aware, Banco Sabadell sometimes give 100% mortgages on their properties (Solvia). Problem is that Solvia sell properties they couldn't get rid off and they are usually overpriced. The foreign buyer is an easy target.

Re: Very nervous beginner
 

Please can you share names if any banks you know of. .... Perhaps Abbey National owned by Santander and TSB owned by Sabadell, as obviously their parent banks would have the knowledge and processes to file the liens on properties in Spain, and have the knowledge and processes on how to foreclose and repossess property if the borrower defaults.

A purely domestic British bank, one that doesn't have branches in Spain, say RBS/Natwest, wouldn't have the knowledge or processes to handle those things.

Re: Very nervous beginner
 

Yes they are the banks thinking of......fewer choices nowadays.

Re: Very nervous beginner
 

Do British banks actually talk to their Spanish counterparts? OK it was a few years ago, but I went into a branch of Halifax in Barcelona, and tried to withdraw some cash from my savings account, ( I had the bank book but no card, and it was a uk account) they just did not want to know, claiming that they were a seperate entity to Halifax Uk, this with the help of a native catalan speaker!

Re: Very nervous beginner
 

That is perfectly normal for most banks - their systems are not connected between countries, (for legal reasons, such as data protection and privacy, linking them may not even be possible), and yes, they are usually separate legal entities, even for the likes of HSBC that proclaims itself as "the world's local bank".

Those international branches typically exist only to support corporations and specific international activities, such as import-export business or supply chain finance, or in the case of foreign banks in London, for accessing investments and finance, not to provide retail banking to Joe Schmoe.

Re: Very nervous beginner
 

Thanks soooo much for all the replies, the information has been very helpful. I have spent the last couple of summers in Almeria in July and August and really like some of the working Spanish towns 15mins drive from the coast (nowhere too high). I think I might speak to some of the solicitors that attend the “A place in the sun” expo in Manchester and see what they say.

Anymore gems of wisdom keep them coming, I’m a sponge!

Re: Very nervous beginner
 

My sister bought a house in Spain,got a mortgage from a local bank in her Spanish village, got her NEI (sort of NI number) from local consulate in Edinburgh, got local expats and the town hall and local mayor to help her with works permissions etc for renovations.
You need to make sure the house is legal and that the person selling is the actual owner.
It is very very hot in Almeria in summer

Re: Very nervous beginner
 

Apart from anything else who know what the ramifications of Brexit will be for international banking ?

It's far from inconceivable for instance that, excluded from the EU frameworks and systems for preventing money laundering and pursuing debts etc. the high street banks may just decide to pull up the drawbridge and force the closure of all accounts held by non residents.

Barclays already did that to some customers before the referendum !

Re: Very nervous beginner
 

Anything is possible, but that's not likely. Banks evaluate risk and profitability, and sometimes decide that the risk is too great for the reward, which is why they may close low value lightly used accounts, but still serve otherwise similar customers/ accounts but with larger balances, such as savings accounts, investments or pensions, and loan or mortgage balances.

If you have a simply current account and run a few hundred euros through it each month you aren't generating enough profit for the bank to be bothered with you, so closing your account is an easy decision, from their perspective.

Re: Very nervous beginner
 

I live on-and-off in Mojacar Playa so my views are biased. Now is a good time to buy there. Prices have started to creep up a little on what the "bottom" figure was. Don't worry, the creeping is likely to stay creeping for some time to come and not jump to the astronomical percentages like in 2005 where property prices increased nearly by the hour.

Again, most of what I was going to say has been covered by previous posters. Only, I want to reiterate the importance of employing a gestor to act solely for you (and not for the estate agent or vendor or anybody else).

"Don't believes" in the Mojacar area:- (i) The railway line between Alicante and Málaga will be seeing trains shortly. (ii) Corvera Airport outside Murcia will open soon (iii) The Theme Park near Murcia will open within a year or two. If you look at Winter in the Sun Property programmes, well known estate agents have lied through their whitened teeth on those three points.

Re: Very nervous beginner
 

Leper thanks soooo much for your reply, I had not paid any attention into the train/airport/theme park news luckily I just love the local area. I have to admit all the brexit talk is making me feel like a tortoise wanting to hide in its shell, but if I don’t go after my little dream of having somewhere to relax to in my holidays I will live with a lifetime of regrets. Any advice of independent lawyers/gestor etc would be really welcomed. If a property that you are looking at has been on the market for over a year what% would you consider trying to reduce the asking price buy?

Re: Very nervous beginner
 

The house that we bought had been on the market for a while and we tried to get them to reduce but no joy. If it is Spanish people selling they rarely accept offers because they decide on a price and tend to stick to it even if it means waiting a long time for a buyer. Other nationalities are inclined to have a more flexible attitude to selling a house.

Rosemary