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Estate Agents Costs

Posted: Wed Apr 22, 2020 3:02pm
28 replies1409 views9 members subscribed
Norma1234

Posts: 24

2 helpful points

Location: Los Alcázares

Joined: 22 Nov 2019

Hello everyone, hope you are all keeping safe and well in this unprecedented time, I would like to know if anyone could let me know the true costs of buying a property on the costa calida coast, I am getting conflicting prices I was led to believe that Murcia regions were cheaper than the Costa Blanca South, 

Many Thanks be safe

Norma

PhilTox

Posted: Wed Apr 22, 2020 3:07pm

PhilTox

Helpful member

Posts: 544

489 helpful points

Location: Camposol

Joined: 1 Oct 2018

Posted: Wed Apr 22, 2020 3:07pm

General figure quoted is 10 to 12% on top of purchase price. That certainly worked for our purchase last year when 1.12 EUR to the pound, just had to change € sign for £  and job done 😁

RichT

Posted: Thu Apr 23, 2020 10:45am

RichT

Super helpful member

Posts: 1134

1259 helpful points

Location: Lorca

Joined: 13 Sep 2019

Posted: Thu Apr 23, 2020 10:45am

PhilTox wrote on Wed Apr 22, 2020 3:07pm:

General figure quoted is 10 to 12% on top of purchase price. That certainly worked for our purchase last year when 1.12 EUR to the pound, just had to change € sign for £  and job done 😁

As in the UK, the buyer doesn't pay any estate agent fees; although vendors generally pay more (3%) than in the UK (average 1%).

As a non-resident, you need a minimum of 30% deposit for a mortgage, but, as with all banks, they will assess your income & outgoings, so if you still have a mortgage in the UK, they may want more. If you're selling up in the UK or otherwise don't need a mortgage, then that will reduce your costs - see below.

As per PhilTox' response, in general, you need to allow for about 12-13% of the purchase price in addition for various fees. It's considerably more expensive than the UK (assuming that's where you currently live). These are:

1. Purchase Tax (the equivalent of Stamp Duty) - 8% of the purchase price. This varies via region and Murcia is lower than many other regions that apply 9% or 10% tax.

2. With a mortgage, you'll probably need to pay all or most of the following, which are generally pro rata to the purchase price or mortgage sum:

  • Mortgage fee (commonly 1.5-2% of the mortgage amount);
  • Valuation fee (approx. £300; £1,000 upwards if you want a full survey);
  • Arrangement fee (approx. £175);
  • Notary fee (the law changed in 2019 and the bank can't charge you for one aspect of the Notary, but they charge you for another aspect! approx. £1000);
  • Bank admin fee (approx. £300);
  • Banker's draft - You will pay the final balance via banker's draft (Spain doesn't appear to have caught up with other countries on electronic transfers! approx. £250);

3. Registration fee (approx. £300)

4. Lawyer fees - approx. £2000

5. Broker fees (if you use a mortgage broker) - approx. £1,000

6. You will need to attend the Notary office twice in person, so factor in travel costs for that, plus, if you're not fluent in Spanish, you may need to pay for a translator, as the Notary needs to know that you understand the mortgage, etc.

The Purchase Tax is, obviously, the main difference compared to UK Stamp Duty. However, council tax in Spain is much lower and I calculated that I would recover the purchase tax difference within 6 years through lower council tax.

The other element to think about is the exchange rate, which over the past year has varied from 1.06 to just over 1.20, which is a variation of 12% - so buying at a low point could cost that much more. You also need to check charges for moving money between banks as well as the exchange rates they offer, as these can all make a difference.

Hope this helps!


CJ

Posted: Thu Apr 23, 2020 10:46am

CJ

Posts: 4

6 helpful points

Location: Camposol

Joined: 2 Mar 2019

Posted: Thu Apr 23, 2020 10:46am

Norma1234 wrote on Wed Apr 22, 2020 3:02pm:

Hello everyone, hope you are all keeping safe and well in this unprecedented time, I would like to know if anyone could let me know the true costs of buying a property on the costa calida coast, I am getting conflicting prices I was led to believe that Murcia regions were cheaper than the Costa B...

...lanca South, 

Many Thanks be safe

Norma

PLEASE BE CAREFUL WHEN CHOOSING AN ESTATE AGENT IF YOUR BUYING PROPERTY IN SPAIN. WE HAVE BEEN CHEATED TWICE WITH TO SEPARATE AGENTS. 5 REAL ESTATE AND OCC. WE LOST 1700 EURO LAWYERS FEES AND HAVE NOW DECIDED AFTER YEARS 0F SAVING AND LOOKING AT PROPERTIES  NOT TO GO AHEAD.  WE ARE HEARTBROKEN AND FEELING SO SAD THAT OUR DREAM HAS BEEN DESTROYED. SO GET WORD OUT TO ANYONE LOOKING FOR AN ESTATE AGENT NOT TO GO TO EITHER OF THE ABOVE. IF ANY ONE WANTS TO KNOW WHAT WE WERE PUT THROUGH PLEASE GET IN TOUCH.

Norma1234

Posted: Thu Apr 23, 2020 11:10am

Norma1234

Original Poster

Posts: 24

2 helpful points

Location: Los Alcázares

Joined: 22 Nov 2019

Posted: Thu Apr 23, 2020 11:10am

RichT wrote on Thu Apr 23, 2020 10:45am:

As in the UK, the buyer doesn't pay any estate agent fees; although vendors generally pay more (3%) than in the UK (average 1%).

As a non-resident, you need a minimum of 30% deposit for a mortgage, but, as with all banks, they will assess your income & outgoings, so if you still have a mortgage in the UK, they may want more. If you're selling up in the UK or otherwise don't need a mortgage, then that will reduce y...

...our costs - see below.

As per PhilTox' response, in general, you need to allow for about 12-13% of the purchase price in addition for various fees. It's considerably more expensive than the UK (assuming that's where you currently live). These are:

1. Purchase Tax (the equivalent of Stamp Duty) - 8% of the purchase price. This varies via region and Murcia is lower than many other regions that apply 9% or 10% tax.

2. With a mortgage, you'll probably need to pay all or most of the following, which are generally pro rata to the purchase price or mortgage sum:

Mortgage fee (commonly 1.5-2% of the mortgage amount); Valuation fee (approx. £300; £1,000 upwards if you want a full survey); Arrangement fee (approx. £175); Notary fee (the law changed in 2019 and the bank can't charge you for one aspect of the Notary, but they charge you for another aspect! approx. £1000); Bank admin fee (approx. £300); Banker's draft - You will pay the final balance via banker's draft (Spain doesn't appear to have caught up with other countries on electronic transfers! approx. £250);

3. Registration fee (approx. £300)

4. Lawyer fees - approx. £2000

5. Broker fees (if you use a mortgage broker) - approx. £1,000

6. You will need to attend the Notary office twice in person, so factor in travel costs for that, plus, if you're not fluent in Spanish, you may need to pay for a translator, as the Notary needs to know that you understand the mortgage, etc.

The Purchase Tax is, obviously, the main difference compared to UK Stamp Duty. However, council tax in Spain is much lower and I calculated that I would recover the purchase tax difference within 6 years through lower council tax.

The other element to think about is the exchange rate, which over the past year has varied from 1.06 to just over 1.20, which is a variation of 12% - so buying at a low point could cost that much more. You also need to check charges for moving money between banks as well as the exchange rates they offer, as these can all make a difference.

Hope this helps!


Hi RichT. Many thanks for your very helpful reply, We are in a position to buy without

a mortgage, but reading another post it seems beware of a couple of estate agents, 

what are yours thoughts on this matter, It makes one think doesn't it,

Many thanks 

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RichT

Posted: Thu Apr 23, 2020 12:02pm

RichT

Super helpful member

Posts: 1134

1259 helpful points

Location: Lorca

Joined: 13 Sep 2019

Posted: Thu Apr 23, 2020 12:02pm

Norma1234 wrote on Thu Apr 23, 2020 11:10am:

Hi RichT. Many thanks for your very helpful reply, We are in a position to buy without

a mortgage, but reading another post it seems beware of a couple of estate agents, 

what are yours thoughts on this matter, It makes one think doesn't it,

Many thanks 

Unfortunately, there are rogues in all business sectors and it sounds like CJ has had a terrible experience which, as they say, has 'destroyed their dream', which is awful.

However, whilst people always tend to focus on a small number of negative issues, I'm sure the vast majority of purchases complete successfully.

I can only decribe our experience for reference and hope this provides some help:

We shortlisted 12 properties via the Rightmove website, then narrowed it down to 4 and contacted the estate agent (who by sheer coincidence was the same agent for all 4 properties) and flew out for viewings.

When we decided the property we wanted, we met the vendor at the property, which helps know that the sale is genuine.

We used a UK-based solicitor (with an office in Spain), who recommended a mortgage broker (again English / Spanish firm). I would never use a lawyer or any other service recommended by an estate agent as it feels likely there would be a conflict of interest.

The broker helped us get an NIE number (which I forgot to mention in my list). This is the non-resident tax number you need to be able to buy a property (technically you don't need it to buy a property, but you need it to pay the property tax, so you do need it!). This only costs a few £s, but you need to get it in person at either a UK embassy / consulate or at an appropriate office in Spain.

There are several actions that you can do via a Power of Attourney to a Spain-based lawyer. This may save a small amount in cost & convenience, but you're basically authorising someone you've never met to act on your behalf in very high value matters, so we didn't do this and I would recommend not to...

Finally, we used a bank called Revolut for currency transactions (on the recommendation from a friend). It's about £50pa to subscribe, but you exchange your money at the live inter-bank exchange rate, whish will always be the best possible; and you can have a pre-paid debit card backed by Mastercard, so that avoids paying any foreign transaction charges or adverse exchange rates when paying for goods / services abroad. It's a bit of a hassle to set up as they needs loads of info. to ensure you're not money-laundering! but I think well worth it.

Hope this helps...

CJ

Posted: Thu Apr 23, 2020 5:00pm

CJ

Posts: 4

6 helpful points

Location: Camposol

Joined: 2 Mar 2019

Posted: Thu Apr 23, 2020 5:00pm

This post that was quoted has been deleted.

OK SORRY.  OCC ARE BASED IN VILLA COSTA AND 5 REAL ESTATE HAVE AN OFFICE NEAR VILLA MARTIN. 

CJ

Posted: Thu Apr 23, 2020 5:13pm

CJ

Posts: 4

6 helpful points

Location: Camposol

Joined: 2 Mar 2019

Posted: Thu Apr 23, 2020 5:13pm

This post that was quoted has been deleted.

OK . WILL HOLD YOU TO THAT. AND NO I DIDN'T THINK YOU WERE HAVING A POP AT ME. CHEERS.

PeterC

Posted: Thu Apr 23, 2020 7:04pm

PeterC

Super helpful member

Posts: 2233

1446 helpful points

Location: Los Alcázares

Joined: 10 Nov 2016

Posted: Thu Apr 23, 2020 7:04pm

All the on-costs of buying are pretty much the same - possibly the actual property prices may be lower. They certainly were lower than the Costa del Sol, but after this lot recedes and the actual terms of Brexit are established, who knows what anywhere will be worth?

Barbara50

Posted: Thu Apr 23, 2020 11:11pm

Barbara50

Helpful member

Posts: 263

109 helpful points

Location: Mula

Joined: 22 Dec 2019

Posted: Thu Apr 23, 2020 11:11pm

We are nearing completion of our purchase and a few hints and tips are:

Keep everyone independent of each other, so don't use the Estate Agents Solicitors or Architect.  We needed the services of all 3 but ensured they had no obvious connection with each other; we made sure ours were from different towns. 

Do not under any circumstances complete without a Certificate of Habitation. Its not law in certain parts of Murcia but you are well within your rights to insist on it before completion.  If you buy the property without it and you are the first ones to apply for it, you might never get it and selling on will be a huge problem for you. 

Yes, it's buying in Spain and you have to put your 'Spanish' head on, but don't get carried away and settle for being told certain things aren't needed when they actually are. Look up independently what is needed from start to finish and keep on at your solicitor to make sure everything is in order. You assume you're paying them to keep everything right but believe me, you have to stay on their backs. From what I know now, I'm sure I could have just acted for myself! 

We decided to go down the power of attorney route, as there are around 8 interventions where signatures / permissions are needed and we just simply couldn't fly in and out that many times. 

Please don't let the fact that it can be daunting put you off. As long as you get prepared and keep your logical wits about you, you'll be fine. 

Good luck! 

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