# Holiday home advice



## kempo23 (Apr 27, 2012)

I have been seriously thinking about buying a holiday home for sometime now. Initially my focus was on Cyprus (which I still love) but since all of the fiascos have come to light, I am starting to go off the idea of buying there. So now I am investigating other countries and would like some advice.

Firstly I am a cash buyer (up to £250,000). Would prefer a villa to an apartment, but not essential. Prefer somewhere that is warm/hot in winter. Easily accessible to airports (ie not within a 30 mins drive), in an expat community/close to resorts/coast. 

What are the additional purchase costs, solicitors, 'stamp duty', other taxes? If a property in a complex, what are the average 'community charges'? If I wanted to rent it out for short periods, are there associated taxes?

Am sure there many other questions, but wanted to start a thread in order to develop a fuller picture of owning property in Spain. Any constructive advice would be most welcomed.


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## jojo (Sep 20, 2007)

kempo23 said:


> I have been seriously thinking about buying a holiday home for sometime now. Initially my focus was on Cyprus (which I still love) but since all of the fiascos have come to light, I am starting to go off the idea of buying there. So now I am investigating other countries and would like some advice.
> 
> Firstly I am a cash buyer (up to £250,000). Would prefer a villa to an apartment, but not essential. Prefer somewhere that is warm/hot in winter. Easily accessible to airports (ie not within a 30 mins drive), in an expat community/close to resorts/coast.
> 
> ...


I wouldnt advise anyone who doesnt understand Spain, the language or their property market to buy - its nothing like the UK! But also at the moment prices are still dropping and Spain is still in crisis and its probably a worse crisis than Cyprus. 

Jo xxx


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## xabiaxica (Jun 23, 2009)

kempo23 said:


> I have been seriously thinking about buying a holiday home for sometime now. Initially my focus was on Cyprus (which I still love) but since all of the fiascos have come to light, I am starting to go off the idea of buying there. So now I am investigating other countries and would like some advice.
> 
> Firstly I am a cash buyer (up to £250,000). Would prefer a villa to an apartment, but not essential. Prefer somewhere that is warm/hot in winter. Easily accessible to airports (ie not within a 30 mins drive), in an expat community/close to resorts/coast.
> 
> ...


if you're buying as a long term investment, now is maybe as good a time as any to buy - yes, values are likely to drop some more, but they'll go up eventually


as for where.......

bear in mind that very little of Spain is actually hot in winter, & although warm in the sun during the day, temperatures can plummet at night - we had 2º here one night last winter & a little inland they were in minus figures

the costs of buying vary from region to region - if you reckon on about 15% that would probably be the most it would cost

'community charges' vary hugely in different regions/towns - though you'd be pretty safe expecting to pay a lot less than in the UK

as a non-resident you'd be liable to pay tax on the property whether you rent it out or not

there are quite a few recent threads discussing these points - have a look around the forum & have a read

my town is half-way between Alicante & Valencia airports - you could do far worse than to buy here 

Portada - Portal Turístico de Xàbia - Ayuntamiento de Xàbia


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## zenkarma (Feb 15, 2013)

kempo23 said:


> What are the additional purchase costs, solicitors, 'stamp duty', other taxes? If a property in a complex, what are the average 'community charges'? If I wanted to rent it out for short periods, are there associated taxes?


Need a bit more information from you really to be able to give you any specific advice. But as a general guide -

Purchase transaction costs on a spanish property, to include all likely costs is about 15%. That's how much it will cost you to buy a property. So add 15% to whatever price you're likely to pay.

It's hard to give you any specific costs on Community Charge as it depends on the individual community, whether they have swimming pools, how well maintained it is, how old the buildings are and so on. There are a number of other running costs you have to consider as well, for example - electricity, gas, water, IBI (local tax), garbage disposal, insurance, telephone/internet if you have it and non-resident taxes if you're not resident there. Reckon on anything between €2-4,000 a year running costs depending on type of property. €2,000 would be for a basic 1 bedroom flat, increase it upwards for a larger property.

Renting wise, as far as I know, you now have to register with the local Town Hall and get a permit and it's highly likely you'll have to pay taxes on the rental income. You'll also need a company to manage the rentals (changing bed linen, cleaning etc) if you're not there. It's not really worth it in my opinion unless you're likely to rent it out over long periods of time. Rental prices in Spain are pretty cheap at the moment and there's plenty of choice. Don't expect much return and expect lots of hassle if you go down the rental route.


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## crookesey (May 22, 2008)

Even though I say it myself, this is a very good idea. 

If you find something that you like and it's been previously rented, look up their web site for rental costs and it's availability calender. You will be surprised how few weeks have been rented, if it hasn't been previously rented, look up a similar one in the same area.

However, with me being a crafty old retired IFA, if I were selling, I'd fill in the availability calendars previously unlet weeks as being let, god loves a trier.


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## rewdan (Feb 23, 2010)

can I ask how 15% in buying costs comes around these days for my own info.
When I bought my house in Spain an extra 15% would have scarred me off the deal.


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## ptrclvd (May 26, 2012)

rewdan said:


> can I ask how 15% in buying costs comes around these days for my own info.
> When I bought my house in Spain an extra 15% would have scarred me off the deal.


It does vary from region to region but I have only paid 10-11% extra on 2 purchases. That is in relation to taxes,notary fees and solicitors fees. My solicitor though is not only excellent her fees are very reasonable and added only 1-2%.


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## zenkarma (Feb 15, 2013)

rewdan said:


> can I ask how 15% in buying costs comes around these days for my own info.


It depends on the region in which you're buying but generally the ITP transfer tax has been increased in many areas from 6 to 8 and 10%.

The total 15% transaction costs includes taxes, notary, stamp duty, registry office, legal fees and mortgage setup costs. Obviously that can be lower depending on the ITP in the region the property is being purchased and whether you're taking out a mortgage or not.


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## bob_bob (Jan 5, 2011)

For warm winters you need to look at the Canary Islands, much of mainland Spain is cool/cold, damp/wet in winter.

£250k is a nice pot but I'd say rent a place for a year before you even think of buying into a property market that is still falling to make sure this really is a long term commitment you want to make; jumping in and buying now is a mugs game.


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## gus-lopez (Jan 4, 2010)

xabiachica said:


> if you're buying as a long term investment, now is maybe as good a time as any to buy - yes, values are likely to drop some more, but they'll go up eventually


But the OP will probably have died at least 20 years earlier. :sad:

Personally I wouldn't buy here at the moment unless it was with money that I could afford to lose & not worry/think about.


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## xabiaxica (Jun 23, 2009)

gus-lopez said:


> But the OP will probably have died at least 20 years earlier. :sad:
> 
> Personally I wouldn't buy here at the moment unless it was with money that I could afford to lose & not worry/think about.


maybe....


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## crookesey (May 22, 2008)

I know an apartment complex on the Benissa coast that when released cost €399,000 for a fully furnished 2 bed with sea views, plus €20,000 for an underground parking space and possessions cage. You can now pick them up for €180,000 inclusive, even with the difference in exchange rates this is a considerable saving, I wonder how low they will go, not much more surely.


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## zenkarma (Feb 15, 2013)

gus-lopez said:


> Personally I wouldn't buy here at the moment unless it was with money that I could afford to lose & not worry/think about.


There it is in a nutshell.

It depends on why someone might want to buy a property in Spain, whether you're looking at it from an investment perspective and what your future plans might be.

If someone has a reasonable pension income and is buying a property in Spain to live in effectively until they pass away and have no intention of selling up and moving elsewhere, now is as good a time as any.

If however your future plans are unknown and there's a good chance you may have to sell up and move at some point in the future and use the capital from the sale to fund the purchase of something else, you'd need to be a little more circumspect about whether now is the right time to be buying in Spain given the uncertain future of the property market.

What concerns me far more (than falling prices) about buying a property in Spain at the moment is what new laws, decrees and taxes this crazy Spanish government might choose to inflict next upon its population. 

The latest bizarre and inexplicable tax they've introduced is a 27% tax/levy on home solar power energy generation. This has been done supposedly to help protect the energy companies but it's a crushing financial blow to those homes and owners who have invested in substantial solar installations for home energy production. They would have factored in long term energy savings against installation costs yet now the government slaps them with a hefty levy making home energy production no longer cost effective.

The fact that the government is doing things like this as well as local town halls increasing the IPT sale transfer tax on property sales at a time when the property market is stagnant and falling and with so many unsold properties on the market simply proves to me that the only thing they're interested in is hammering the population with more and more taxation. 

To increase sale transfer tax at this time is sheer madness and will further reduce sales and depress the property market.

It's this that worries me about investing in Spanish property at this time.


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## crookesey (May 22, 2008)

When I read some of you guy's posts about all of the seemingly hidden costs involved in living in Spain I'm minded of a conversation that I had with an old friend many years ago. He was into the very early versions of computers, a company in Switzerland offered him a job which he accepted, he still lives over there. On one of his trips back to the UK I asked him why he'd chosen one of the most expensive countries in the world to settle in. He answered to the effect that everything was expensive but he was paid so well that he could afford whatever he wanted, he pays a lot out but he gets a lot back, Spain certainly doesn't offer the latter.


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## kempo23 (Apr 27, 2012)

It would appear that the Spanish government is 'biting the hand that feeds them'. Some of the associated costs of buying / owning property in Spain are clearly a rip off. Maybe I have underestimated the problems some EU countries are experiencing, but at least the feedback here has given food for thought. Perhaps now is not a good to buy a holiday home in Spain.


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## zenkarma (Feb 15, 2013)

kempo23 said:


> Perhaps now is not a good to buy a holiday home in Spain.


Personally speaking, I don't think it is either.

I know a lot of people are attracted to Spain for a variety of reasons, lowered house prices, sunshine etc. but there is a sinister underbelly to Spain that I personally think people need to be aware of.

Corruption in Spain is rife, it's just as bad as it has always been. The sheer volume of civil servants both in central and regional governments is of staggering proportions—all on good salary and pension packages. They need more and more tax income to support this burgeoning army of jobsworths and they have no intention of reducing them down.

The Spanish government therefore has no alternative other than to become extremely aggressive on taxation and at the moment they're slapping taxes on anything that moves.

I was planning on relocating to the flat in Spain to live full time, until they brought in the asset reporting law. If that corrupt government thinks I'm going to declare all my assets to them so they can tax them at some point in the future to support their unsustainable army of civil servants they can think again. It's not going to happen. I've changed my plans.


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## crookesey (May 22, 2008)

zenkarma said:


> Personally speaking, I don't think it is either.
> 
> I know a lot of people are attracted to Spain for a variety of reasons, lowered house prices, sunshine etc. but there is a sinister underbelly to Spain that I personally think people need to be aware of.
> 
> ...


Exactly how I feel, many forum members appear to think that they are fortunate to be able to live in Spain, when the truth of the matter is that Spain is fortunate to have people who don't mind being ripped off by both local and central government living within it's borders.


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## zenkarma (Feb 15, 2013)

crookesey said:


> ...many forum members appear to think that they are fortunate to be able to live in Spain...


It depends on your perspective. 

If people are prepared to put up with the bureaucratic nonsense that goes on in Spain, the corruption, the inexplicable (and often unfair) laws that central and local government introduces, the annoying manana syndrome so many Spaniards are infected with and the two speeds (slow and stop) that their businesses seem to operate on for the slower and supposedly 'better' quality and way of life living there gives them, that is entirely their choice. It's a trade off many seem prepared to make.

What's wrong of course is for Brits to go and live in Spain and expect it to work in the same way that the UK does. It doesn't and won't. You have to accept that Spain works differently and if you can't deal with that change, don't go there.

Unfortunately, many people seem blind to the bad sides of Spain and simply complain about them when they come across them and only ever see and want to see the good sides.

It's horses for courses. You pays your money and you takes your choice.

It's just not for me. I like Spain, I like the relaxed, slower pace of life and I like going there on holiday but I just couldn't deal with the bad sides of Spain to want to live there full time. It would drive me insane.


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## Calas felices (Nov 29, 2007)

Sounds like a cue for all the Spanish lovers to start moaning about all the things that happen in the UK. That's a whole lot easier than trying to justify all the bad things in Spain.


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## zenkarma (Feb 15, 2013)

Calas felices said:


> Sounds like a cue for all the Spanish lovers to start moaning about all the things that happen in the UK.


I don't see the UK as being any better or worse than Spain. 

They're equally as corrupt if not quite so obvious about it, have just as large a Civil Service and Local Government on equally silly salaries and pensions not to mention all those semi-government department Quangos they have and they tax you just as much if not more.

The sad reality is I'm afraid that since the global banking crash all European governments are in big financial trouble. The only real option they have is to continue levying ever higher taxes on their populations as well as indirectly shoving their fists into peoples savings and pulling out giant piles of money in the name of low interest rates, rising inflation and QE.

Wherever you go in Europe will be much the same. The only real choice people have is to choose the least of the evils and live in the place you ideally want to be and enjoy living in.


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## xabiaxica (Jun 23, 2009)

Calas felices said:


> Sounds like a cue for all the Spanish lovers to start moaning about all the things that happen in the UK. That's a whole lot easier than trying to justify all the bad things in Spain.


it's so long since I lived in the UK & paid any interest in what goes on there, that I couldn't possibly compare

my view is - I _choose_ to live in Spain - it's not perfect - nowhere is

but it's home............. and that's all there is to it


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## crookesey (May 22, 2008)

I'm currently having mild discussions with HM Revenue & Customs relative to them using a full years state pension for assessment when my 65th birthday fell on 30th June last year, meaning that they should only add 40 weeks onto my 2 private pensions. Now can you imagine trying to explain that to the Spanish tax-man?

They know my date of birth and shouldn't have made the error, however where you have bureaucracy you have errors, I am used to dealing with the UK tax-man who has overtaxed me for as long as I can recall due to me having fluctuating emoluments, it's a bit like having a savings plan that doesn't pay interest.


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