I have a small holiday home in Spain that I have decided to sell, how do I do it and what do I need to know?
I have a small holiday home in Spain that I have decided to sell. How do I do it? IC, Lincolnshire.
For sale: Hundreds of thousands of Brits own property in Spain, so there is plenty of support for anyone looking to sell
Ruth Jackson-Kirby responds: Selling a property can be stressful at the best of times, but add currency exchange and the laws of another country and it all becomes even more complicated.
Fortunately, hundreds of thousands of Brits own property in Spain, so there is plenty of support for anyone looking to sell.
Peter Robinson, chief executive of the Association of International Real Estate Professionals (AIPP), says the good news is that you should get a listing with an agent fairly quickly, as the market in Spain is strong at the moment and agents have low stock levels.
“Just be careful who you choose, or your property may not sell in the time frame you’re looking for or be an enjoyable experience,” he adds.
How to save on money transfers abroad
If you’re sending money abroad or transferring cash from foreign currency to pounds, it’s worth not using your bank.
Banks generally charge currency exchange rates in your favor and may charge percentage fees in addition to eating up a large sum of your cash.
The best way to save money is to use a specialized currency exchange service.
This is Money has partnered with FXCompared to help readers find the best rates on money transfers.
> Use our tool to compare money transfer exchange rates
The best way to find a good agent is through recommendations from people you know. If you can’t get personal advice, be sure to contact a few different agents and choose the one you think offers the best service.
Look for agents who have bought and sold properties for British owners before.
Also check that your preferred agent is a member of a professional body such as the Real Estate Agent (API). Members are regulated and there are complaints procedures and liability insurance in place to protect you. The AIPP also maintains a list of 180 agents who specialize in selling properties internationally. Go to aipp.org.uk.
The sales commission can be around five per cent, reflecting the higher costs of international marketing, typically in the UK, the Netherlands, Belgium, Germany and Scandinavia.
Once you have an agent, make sure there is a clear written agreement that covers the fee you are paying and any other charges.
It is not necessary to have a lawyer, but it is a good idea. Find one who speaks good English and can handle the selling for you.
You can find a list of English-speaking Spanish lawyers at gov. united kingdom/government/publications/spain-list-of-lawyers.
As you will no doubt remember when you bought your property, Spanish law requires that you have a notary. Their role is to verify that all the documentation for the sale is correct, to ensure that taxes are paid, and to register the sale with the Spanish Land Registry.
The notary is a neutral party, and must agree one with the buyer. There are thousands of notaries in Spain, and they work on a fixed fee, so you don’t need to shop around, just find someone with a good reputation.
Fortunately for you, the buyer usually pays the notary fees as part of the sale price.
To help your sale go smoothly, get all your paperwork in order right away.
You will need to provide title deeds to the property, as well as receipts showing you have paid the local council property tax, details of the community bylaws, an inventory of the furnishings to be included in the sale, and copies of your receipts. public services.
The sales process is quite similar to the one in the UK, but with one key difference. Once the contracts are signed, the buyer pays a deposit, usually 10 percent of the sale price. If the buyer walks out, he loses his deposit; if he changes his mind, he could be responsible for paying double the deposit as compensation.
Once the sales are made, you need to consider how you will transfer the euros you received to the UK and into sterling.
“Be careful who you use to transfer the sale proceeds to, your bank will give you a terrible conversion rate,” says Robinson.
“We recommend using an independent, regulated currency provider.”
Lastly, don’t forget the tax bill. Spain has a Capital Gains Tax that will need to be paid.
In addition, there is a ‘plusvalía tax’ on any increase in the value of the land on which your house stands, which is paid to your local Spanish council.
The sale may also be subject to UK capital gains tax, but the UK and Spain have a double taxation agreement, so you only have to pay tax in one country.
If you are a UK resident, Revenue & Customs will generally give you a credit for any tax you have paid in Spain.
Your notary will ensure that you pay any tax due in Spain. Your solicitor should be able to help you navigate whether tax is due in the UK.