Selling your property in the Costa Blanca
OUR RESIDENT PROPERTY EXPERT, Shelley Starkey, takes a look at the current state of the property market from a seller's perspective and outlines the costs homeowners on the Costa Blanca should expect to budget for.
The Spanish property market is active at the moment and domestic demand for homes along the Mediterranean coast has soared over the last couple of years.
Accompanied by higher interest from overseas buyers throughout the European Union (particularly holiday home investors in France and Germany), and a new-homes market still reeling from a shortage of key-ready properties, the resale market remains particularly strong.
It's more important than ever before that property sellers in the South Costa Blanca and Orihuela Costa areas are fully aware of the sales process and the costs they are likely to incur from the outset.
With regards to selling fees, as a very estimated and general rule, sellers should budget for around 10% of the sales price as an expected outlay. Some property owners might be able to claim back part of the costs, such as non-residents tax, if certain criteria are met.
What are the costs involved when selling a property on the Costa Blanca?
Nonetheless, these are the main costs that need to be considered when selling a property in Spain:
1) PLUS VALIA
The estimated budget for the Plusvalía can vary a lot, depending on the cadastral floor value, the location in which the property is based, and the number of years the property has been owned, since it is a progressive tax. A precise calculation is essential to obtain an accurate total sales cost estimate, and we can offer this service to our clients.
2) COMMUNITY FEES
Community fees need to be shown to be paid and up-to-date. Usually, the seller will have to present a Certificado de Comunidad to the buyer upon signing the Escritura.
3) IBI AND UTILITIES
Likewise, utility bills need to be up-to-date and current to the date of sale. Homeowners will have to provide the original proof of payment at the signing during completion. Sellers have to pay the IBI (Spain's equivalent of Council Tax), for the whole fiscal year in which they are selling.
4) MORTGAGE SETTLEMENT FEES
Mortgage cancellation fees and registration fees - if applicable.
5) NON-RESIDENT RETENTION
The 3% retention is a tax that is payable when a non-resident person sells a property in Spain. The buyer of the property is required to retain 3% of the purchase price and deliver it to the tax office. The non-resident seller can claim to have the 3% returned to them.
The rate of Capital Gains Tax in Spain is 19% for EU residents and 24% for non-EU residents. Please note that from the 1st January 2021, liability for British residents changed from 19% to 24%, in line with current rates in force for all other non-EU residents.
What taxes do you need to pay when selling a property in Spain?
6) LEGAL FEES
These fees cover the costs of the preparation of household utility contracts, community charge and SUMA invoices, liaising with the purchaser's representatives and the notary, preparing the notary appointment and all related paperwork for completion, accompanying the seller to the notary and providing translation, calculate the 3% retention, calculate and advise regarding Capital Gains Tax liability, and give sellers fiscal representation throughout the sales process.
7) HABITATION CERTIFICATE
This document proves that the property meets the Town Hall habitability requirements - the buyer can't assume responsibility for the household utility contracts without it.
8) ENERGY PERFORMANCE CERTIFICATE
Since June 2013 it has been a compulsory legal requirement to have an EPC in place before advertising a property for sale or rent.
9) ESTATE AGENTS COMMISSION
This averages around 5% plus IVA as standard. Our Administration Department can provide a more accurate personalised breakdown of the costs involved, and we can also advise on current pricing for the marketing of your home.
Ideally, once viewed, we can take into account the exact position of the home, orientation, condition, etc; and advise on any points that may help assist with a quick sale.
We have created a free digital guide for sellers with more in-depth information regarding selling your property in Spain. Packed with detailed financial examples, and all the best advice you'll need to sell your home in the fastest and most profitable way.
Get in touch with us today and ask for your free copy of the Costa Blanca Sales Guide for your laptop, smartphone, or mobile device. Alternatively, contact us to arrange a free valuation and appraisal of your property in Spain.