Holiday Villa Lanzarote to buy

This general information is intended solely as a guide only and for 1st time purchasers of property on Lanzarote / in Spain. All buyers should always seek their own independent legal advice from a Spanish lawyer. 

 

1.] Having found your property, an initial (negotiable) deposit is paid to reserve the property until the Sale and Purchase Contract (S&PC) can be signed. You should engage the services of a Spanish lawyer at this point who will then undertake local searches on Lanzarote as regards the property’s current ownership and other factors. The S&PC commits both the seller and yourself to the conditions as mutually agreed between yourself and the seller. Once the S&PC is signed, sometimes, but not always, another payment may be requested by the seller. This is sometimes 10% of the sale price but the actual amount can be by negotiation. 


2.] Non-residents buying a property in Lanzarote (and Spain in general), will need to have possession of a “Numero de Identificacion de Extranjeros” (NIE), in order to buy a property. Your lawyer should be able to arrange this on your behalf and with the procedure of obtaining it. 


3.] Unlike in the UK and other countries, the actual purchase and taking ownership of your property on Lanzarote only happens when the Title Deeds of the property are signed by both the seller and the buyer, in person, in front of a Notary. Unlike the UK, (for example) there is no 'Exchange of Contract' procedure, nor a 'Completion Date'. The entire physical process of purchase and sale takes place in front of the Notary at an arranged time and date. This is also where the final (balance) payment is made in cash or as a banker’s draft, if all documentation is correct from both the parties. It’s at this point that you become the ‘owner’ of the property. Your Spanish lawyer should be present with you on the day. 


Additional Costs to allow for when purchasing propery on Lanzarote.

Purchasers should allow an additional approximately 8.5% of the purchase price for a purchase not involving a mortgage, or approximately 10% for a purchase involving a mortgage. 
The additional costs comprise; 

For a Resale Property:  Property Transfer Tax @ 6.5% of the purchase price. 

For a New Property:  IGIC which is 5% of the purchase price, plus 0.75% Stamp Duty. 

Land Registry Fees payable.
Notary Fees and your own Lawyers Fees.
Any translation fees. (For non Spanish speaking persons). Allow up to €100. 
Valia Tax – which is similar to UK VAT (Value added Tax).

A Spanish lawyer will usually ensure that these additional costs are settled on your behalf and give you a breakdown statement once payments are completed.