Guide to Property Purchase
in Gran Canaria and the
Canary Islands
Buying property anywhere in the world, is a
stressful business, but even more so if this is
your first time buying abroad. Here BuyIN Gran
Canaria outline’s some of the parties involved as
well as some of the procedures involved.
The Estate Agent
A reputable estate agent is always a must when
buying in Gran Canaria unless you have a clear
understanding of all the procedures and can
eloquently converse in Spanish. Your estate
agent should be the one who liaises with all the
parties involved on your behalf.
The Offer
Unlike the UK, a vendor will ask for the price
they want for the property, rather than except
the highest offer and it is rarely the case that
they will move from that price. Once you have
selected the property you wish to purchase, you
will be expected to pay a holding / reservation
deposit of approximately €3000 - €6000, which
should be held in a client account by either the
buyers lawyer or the estate agent ( always ensure
that your Estate Agents has a separate clients
account).
Once you have placed a reservation deposit
you should receive a reservation contract that is
written in both Spanish and English.
Approx thirty days after the reservation you will
have to deposit approx 10% of the purchase price,
you will then receive a Purchase Contract.
Once a purchase contract is issued the balance
of the purchase price is payable at the signing
of the title deeds at the notary, this is usually 8 –
12 weeks after the reservation deposit although
in some cases it can be quicker . Developers of
new build or off plan properties however, accept
instalment payments of between 20 -30% of
the purchase price during the building process
and then the balance is paid by either cash or
mortgage at the signing of the deeds, some 12-
18 months later.
The purchase contract is very specific in terms
and will include penalty clauses and ompensation
for late payments or cancellation by either
party.
The Lawyer
It is vital you employ an independent lawyer to
your Estate Agent as your lawyer will check all
the documentation and make sure it is correct
also they will ensure that there are no outstanding
debts against the property. If you are not
fairly fluent in Spanish, you will need to obtain
a lawyer who can speak English as well as Spanish.
Your Lawyer will ensure you are familiar with all
law aspects of your purchase and it is generally
recomended that you use a local lawyer as they
can be present with you when taking title of
your property.
There are a number of cost’s that are associated
with purchasing a property which you should
always add to the purchase price and you
should be prepared for ouging expenses on
taxes, land charges, professional fees, Bank fees
etc which are around 11% of the purchase price
if you are taking a mortgage.
The Wills
It is therefore very important you talk to your
lawyer about wills and inheritance once you
have taken title of your property as the laws
differ from those than you have in your own
countries.
The Bank
You will need to open a Spanish bank account
and to do so you will need an NIE/NIF number.
This is a document required for purchasing property,
opening bank accounts, obtaining employment
(if you are an EEC member or have a
work permit) and paying taxes. Mortgages and
insurances are now very competitive in Gran
Canaria, so it is worth shopping around for the
best terms and rates.
The Notary
All property purchases (signing of the deeds) as
well as most other forms of legal documentation
are completed and signed in front of a notary
in Spain and the Canary Islands. The notary,
a public official will check that documentation
presented by the lawyer is correct and ensure
all the details are correctly entered in your final
escritura and once signed enter the document
into the public records. They are therefore extremely
vigilant and the smallest of discrepancies
will be rectified prior to you signing.
There are few notaries on Gran Canaria and so
their time is at a premium. Fiesta’s and holiday
periods can therefore cause some delays in
completion.
You do not have to be present at the signing of
the deeds if you have organised for your lawyer
to receive power of attorney (POA). A word of
warning though, ensure you only give your POA
to either a lawyer or a very trusted member of
your family, the process of organising POA is relatively
simple here if you are present and takes
just a few hours if organised properly.
If however you try to do it from outside the
country (i.e. the UK), it becomes a little more
difficult and involves a notary in the county of
domicile and has to be certified by the Foreign
Office and Commonwealth Office.
After the signing, you will receive a certified
copy of the title deeds, until they are registered
at the Land Registry Office, at which time the
originals will be returned to you or your bank if
they are the mortgage broker.
There are some excellent free guides produced
by various Estate Agents such as GoldAcre
Estates, Banks such as SolBank, La Caixa and
others, Lawyers such as Glex and Co and Bufete
Gonzalez Segura all of which outline all the
purchase processes in much more detail.
This guide from BuyIn Gran Canaria is not
designed to replace proper legal or fiscal
representation which should always be
sought when purchasing property.
For more information contact:
www.goldacreestatesgrancanaria.com
or call 0034 928 56 56 13
