Larraín Nesbitt Lawyers is a Marbella-based independent law firm specialized in property conveyancing, taxation, litigation, probate and succession. Expert native English-speaking lawyers and economists blend legal and practical advice providing tailored assistance on your matter. Our range of services cover the greater Marbella area, Sotogrande and Costa del Sol.


The firm focuses advising foreign investors on acquiring residential property in Spain both from a legal and fiscal point of view. Our no-nonsense approach to business coupled with our commitment to clients ensures easy-going transactions. We pride ourselves in putting our clients’ interests at the forefront of everything we do.


Larraín Nesbitt Lawyers, your legal partner in Spain.

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8 tips on buying a home in Spain

Raymundo Larraín Nesbitt, May, 21. 2019

Lawyer Raymundo Larraín gives us a few insider tips on buying your dream home in Spain.

Marbella-based Larraín Nesbitt Lawyers has over 16 year’s taxation & conveyancing experience, offering you 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2019. Plagiarism will be criminally prosecuted.

 

By Raymundo Larraín Nesbitt
Director of Larraín Nesbitt Lawyers
8th of June 2019

 

1. Location, location, location.

Undeniably a worn out trope, but that doesn’t make it any less true. You are better off buying the smallest house in the best neighbourhood than buying the fanciest house in a less reputed estate. In practical terms, this translates into capital appreciation over the long run as well as making it easy on yourself to sell on. A well-located property enables you to sell it in a few months, as opposed to a poor-chosen location which may leave you waiting for years on end. Seasoned estate agents are your best source of information on the ground when it comes to choosing the ‘right’ address, whether for investment purposes or for bragging rights. Some hallmark names, such as Marbella or Mallorca, are consolidated world-renowned household brands that greatly mitigate exposure to any market downturn as they are always highly sought-after locations.

2. Orientation

On buying property in Spain, we advise you procure yourself a south or south-east orientation due to the sun’s angle. This will ensure your property is drenched in sunlight all year round and will significantly contribute to reduce your heating bills (and electrical bills) in winter. Spain’s electricity is not exactly cheap. If you are in a coastal area, a southern orientation may also secure you nice sea views to boot.

3. Affordability vs maintenance

Budgeting carefully is a key element of any successful conveyance procedure. Yes, you may afford to buy a swanky property in a great location, but can you afford its steep maintenance? Much like some high-maintenance partners in real life, some properties’ upkeep are (very) demanding and you better have the deep pockets to keep up in the game. You really do not want to get involved with a property you cannot afford to maintain, as this will be a financial millstone that will drag your finances down and may even lead you to file for bankruptcy. Only buy a property you are absolutely confident you can afford to maintain over the mid to long run. Do not get carried away with wishful expectations on commanding high rental yields to offset mortgage repayments, as property bills pile up inexorably at the start of every month. If you are relying on rental income to service your mortgage instalments, flat out you shouldn’t buy.

4. Buy-to-let or buy-to-live

This is a fairly important point that is often overlooked by buyers. The characteristics you need to look for are very different depending on whether you are looking at buy-to-let or else with a view to live in. If you are looking at the former, the property must have attained a Licence of First Occupation, it should be smaller, with good communications, within walking distance of all amenities and the sea (on coastal resorts). If you are after the latter, the property should be larger, with nice views, and good schools and hospitals nearby.

5. Ground floor or penthouse?

We had already covered in-depth the pros and cons of each in our blog: ground floor vs penthouse, from a Spanish perspective. Take good note that in Spain both property types are perceived as the opposite from the United Kingdom; which in turn impacts on price, capital appreciation, maintenance and even security.

6. Be familiar with your community bylaws

Before you commit buying a property in a Community of Owners, you should ask for copies of the minutes of the previous General Assemblies, which will highlight any existing issues in your community. It is also of vital importance you fully understand the rules governing your community (i.e. Community of Owners may now outright ban holiday lettings). If you are looking to invest in a buy-to-let and only find out post-sale that your community forbids holiday homes, you have wasted your money. It is also important you fully realize how much money you need to pay every quarter, as some quarterly community fees are exorbitant, especially in exclusive gated communities dotting upmarket coastal areas. Another well-known issue is that some community presidents (which officially hold an unpaid role) perpetuate themselves year after year abetted by their cronies and do in fact make a very tidy living running whole communities at the expense of pocketing fees from fellow owners on fudging the numbers. I tell you - by experience - that no one who has held the role of community president wishes to repeat from one year to the next as it is a very ungrateful task. Be wary of community presidents who hold their position indefinitely and fight tooth and nail to retain power and control. Only on changing administration does the corruption of the former management come into light.

7. Urban vs rural

Unlike in the United Kingdom, rural property in Spain is marred with legal issues. In the region of Andalusia alone, there are over 200,000 illegal properties. Buying a property with issues could see your trapped for years on end without a chance of selling it on. Moreover, on buying an illegal property you take over the liability of any prior planning illegality; the previous owner gets to walk away scot free – with your money. On buying rural, hiring a competent conveyancing lawyer from the outset is a must to help you waddle through the admin minefield. I would advise a reputed surveyor is also instructed, preferably regulated by RICS and working to UK standards. That is not to say that urban property is all good and rosy, far from it. But no doubt urban property offers much less legal risks than its rural counterpart. If you are looking for a quiet rural life to commune with nature, the choice is obvious. If you are more the city type, that easily gets bored watching grass grow and sheep bleat, you may want to look at urban instead.

8. The lawyer

A necessary evil. You would never buy a property in the UK without instructing a solicitor or conveyancer, and yet a surprising number of people choose not to instruct a lawyer or legal representative when buying abroad. If anything, it is even more important to obtain good legal advice when buying overseas as it is highly likely that you will be unfamiliar with many of the key processes. While it is possible to buy a property in some overseas jurisdictions, including Spain, without having to appoint a lawyer, it would be very unwise to do so. Buying a house is one of the biggest investments most people make in their lifetime. So why take the risk by not obtaining proper legal advice?

Choosing a reputable conveyance law firm will be your best line of defence against the stack of odds you will be facing. Make sure your lawyer is truly independent and is not affiliated with your chosen estate agency in any way, you would come to regret this. Having a seasoned lawyer on board is having half the fight already won. Your lawyer will be able to cut through the red tape seamlessly, enabling you a smooth and safe buying procedure. Three expenses on which you should never skimp are: doctors, lawyers and education. You would regret dearly ‘saving’ money on any of the three.

Our law firm has over 16 year’s conveyancing experience at your service. We are members of the British Chamber of Commerce, Spain, and regulated by the Spanish Law Society.

Because peace of mind is priceless.

Conclusion

But enough of platitudes. All that matters is that we are in a buyer’s market.

Do not be rushed into buying a property, you will be spoilt for choice.

If you have qualms over a property, or its area, why don’t you consider renting it for a while? You should ponder such factors as leasing it on or off-peak. You can always sign a rent-to-buy contract. If it is to your liking, then go ahead and buy it; you only live once.

 

We offer the most competitive fees in the market.

Conveyancing – Buying fees on application

We are specialized in conveyancing

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in conveyancing, inheritance, taxation and litigation. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on (+34) 952 19 22 88 or by completing our contact form to book an appointment.

Article also published in Spanish Property Insight: 8 tips on buying property in Spain

 

Audentis Fortuna iuvat.” – Aeneid, Virgil.

Loosely translated as “Fortune favours the bold.”

 

Legal services available from Larraín Nesbitt Lawyers

 

Conveyancing-related articles

Buying distressed property in Spain – 8th August 2011
Buying resale property in Spain – 21st February 2013
Buying off-plan property in Spain – 8th of June 2013
How to buy commercial property in Spain – 4th July 2014
How to buy rural property in Spain – 8th August 2014
How to Buy Property in Spain Safely – 10th October 2014
House Hunting in Spain – Interview with The New York Times. June 2015
Buying property in Spain from a private seller (Resale Property) – 21st of February 2017
Buying property in Spain from a developer (Off-Plan Property) – 8th March 2017
How to inspect an off-plan property overseas – Q&A with The Sunday Times. July 2017
Buying property in Spain – 10 reasons to hire a lawyer – 8th November 2016
8 Tips on Buying Off-Plan in Spain – 8th June 2018
Tax advantages on becoming resident in SpainThe Address magazine (pages 358 - 373). December 2018
Taxes on buying Spanish property – 8th December 2018
Do’s and don’ts on buying property in Spain – 8th April 2019
8 tips on buying a home in Spain – 8th June 2019

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.019 © Raymundo Larraín Nesbitt. All rights reserved.

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Last Blog Entry:

60% landlord tax break on gross income rental earnings - challenged in Brussels

Raymundo Larraín Nesbitt, May, 21. 2019

Marbella-based Larraín Nesbitt Lawyers has over 16 year’s taxation & conveyancing experience, offering you 40 legal and corporate services. Our team of native English-speaking lawyers and economists have a long track record successfully assisting expats all over Spain.

You can review here our client’s testimonials.

Article copyrighted © 2019. Plagiarism will be criminally prosecuted.

By Raymundo Larraín Nesbitt
Lawyer - Abogado
21st of May 2019

 

                                                                                                                                                             Photo: Cala Gat at Rajada, Mallorca

 

Despite the misleading heading, this is actually good news for us all.

Up until now, only Spanish-resident landlords could benefit from a 60% reduction on gross income earnings derived from long-term lets (does not apply to short-term lets or holiday homes). This allowance is only applied to landlords which are (tax) resident in Spain and the property must be the permanent abode of the tenant. Currently, the Spanish Tax Office bars tax advisors from applying this tax break to fellow EU nationals.

However, this is currently being challenged at Brussels on grounds of discriminating fellow EU member state nationals as it infringes one of the main covenants of the founding Treaty of Rome from 1957, freedom of movement, which happens to be at the very core of the fabric on what constitutes the Union.

In all likelihood (and in my personal opinion only, so take it with a pinch of salt), in compliance with the ECJ’s landmark ruling from 3rd September 2014, the Kingdom of Spain is bound to lose this court case - and rightfully so!

All this is good and well, but how does it affect me, my pocket?

It means that when Spain foreseeably loses this court case, as is widely expected, and in coherence with previous ECJ rulings, all EU non-resident landlords (albeit resident in the Union i.e. the United Kingdom) will be able to take advantage from this ‘new’ tax allowance for the first time ever. Meaning landlords, whether resident in Spain or in the rest of the EU, will now be in equal footing, benefitting from the same 60% tax break Spanish landlords have already been enjoying for years.

In plain English, after Spain loses at Brussels, all EU landlords on long-term lets will stand to pay significantly less taxes on the rental income they derive from renting out immovable property located in Spain. Providing your tax advisor does actually claim this tax relief, granted. It will not be applied automatically on your tax return…

This new tax change will translate into all EU-based landlords to benefit from a huge discount on their long-term rental income tax bill. Once more, kudos to our Brussels overlords.

Short-term EU-based landlords (read holiday homes) had already been benefitting over the last 4 years from reduced taxation on being allowed to greatly mitigate their tax bills on renting out. On average, our law firm reduces our client’s tax bills by 70%, or more. More on this, in our taxation article: Save 70% on your landlord tax bill – 8th March 2019.

Bottom line, both long and short-term EU landlords alike can both expect a great mitigation on their Spanish tax bills in the near future.

Lower taxation is always good and necessary for the economy. It incentivizes and fosters foreign investments in Spain, chiefly on property purchases with a view to buy-to-let. Which in turn leads to job creation, greater disposable household income, increased wealth and political stability. And our spendthrift politicians get to spend more of our hard-earned taxpayer's money in whatever it is they spend it on.

 

Larraín Nesbitt Lawyers, small on fees, big on service.

Larraín Nesbitt Lawyers is a law firm specialized in taxation, inheritance, conveyancing, and litigation. We will be very pleased to discuss your matter with you. You can contact us by e-mail at info@larrainnesbitt.com, by telephone on 952 19 22 88 or by completing our contact form to book an appointment.

 

Legal services Larraín Nesbitt Lawyers can offer you

 

Rental-related articles

 

Please note the information provided in this blog post is of general interest only and is not to be construed or intended as substitute for professional legal advice. This article may be posted freely in websites or other social media so long as the author is duly credited. Plagiarizing, whether in whole or in part, this article without crediting the author may result in criminal prosecution. VOV.

2.019 © Raymundo Larraín Nesbitt. All rights reserved.

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Last Press Entry:

Do's and don'ts on buying a home in Spain

Costa del Home Magazine, May, 21. 2019

Costa del Home Magazine is the single largest property advertising publication on the Costa del Sol packed with properties for sale and rent, real estate news, features and analysis. CHM kindly published our article on Do's and don'ts on buying property in Spain in in its April 2019 issue.

Full article can be found on page 55. Link to our article: Do's and don'ts when buying a home in Spain

Original article can be found published in our website: Do's and don'ts on buying a home in Spain

Larraín Nesbitt Lawyers' conveyancing service: Conveyancing – Buying

 

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