What should you consider before investing in Spain?

ZAPINVEST, specialist in second home real estate in Spain, advises and supports buyers before, during and after buying a property.

What do you need to know if you want to invest in real estate in Spain? And what should be planned to make this purchase successful? Jonathan Boucher, CEO of ZAPINVEST in Belgium, gives us some tips.

A long vacation is the perfect opportunity to enjoy life under the Iberian sun and find your own little piece of paradise. Belgians who fell under the spell of Spain do not hesitate to invest in a second home. They are currently the second largest number of foreign buyers in proportion to the number of residents (after the Swedes), in the first quarter of 2022, 1,207 acts of sale were recorded.

“The coast is particularly attractive to Belgians, so we have two local offices in Torrevieja on the Costa Blanca and in Puerto de la Duquesa on the Costa del Sol, and we also cover the Costa Calida between them). Thus, we are close to our customers in Belgium (with offices in Liège, Brussels and Namur) and in Spain. This is important because we support buyers before, during, and often after the transaction. Because once a property has been purchased, it needs to be maintained and why not make it profitable by renting it out when you’re not living there, which can quickly become a headache because of the distance,” says Jonathan Boucher, CEO Belgium ZAPINVEST.

Get ready to buy

“You have to know that the Spanish market is very reactive. Belgians compete with potential buyers of other nationalities. If you find a property in Belgium, by the time you arrange a trip to visit it, it may already be sold. That’s why we help our clients define exactly what they are looking for in terms of property style (new or old, house or apartment, with or without pool, etc.), type of environment (waterfront, city center, countryside). …) and for what purpose (to live there in a boarding house, to come on vacation with the family, to go for a walk with friends…). Then we arrange the trip by listing the available properties that meet the search criteria in the program. My advice, if you are going to Spain this summer and want to invest in a second home, think about what you want it to look like and make a list of important points. You can also discuss this with our local bilingual teams and make initial visits. In terms of prices, the average m² is cheaper than in Belgium, but the trend is upward and we think it will increase. So it’s better to act now to have better purchasing power. Next year, you will definitely have less m2 for the same budget,” explains Jonathan Bouchet.

Buy accompanied

If you are buying an existing property, you can try to negotiate a price. On the other hand, if you buy a new property off the project, the promoters do not give a discount. In this case, you sign a real estate reservation agreement pending a purchase agreement.

“Thanks to the local presence of three-quarters of ZAPINVEST’s bilingual team, we know the land very well and have established partnerships with developers who trust us to market the properties they are building on the coast. . A big advantage because we are very early aware of opportunities. We also cooperate with lawyers who prepare sales contracts. Unlike us, the case is not prepared by a notary, but by a lawyer. You should also know that for existing real estate there is no compromise, the contract of sale is signed directly. For new properties, the compromise is usually signed one month after the reservation. Then it is necessary to pay a total of 30% to 40% of the amount,” Jonathan Bushe clarifies. “If you need a mortgage loan, you can go to a Belgian banker (who will mortgage your Belgian property) or a Spanish banker (who will mortgage your Spanish property).

If you buy new, the VAT rate is only 10% compared to 21% in Belgium. If the property already exists, transfer rights are 8-10% depending on the region.

Added to this is a registration fee of 1.5% and you pay your solicitor 1.21% VAT. Between 12% and 14% of the selling price should be included in the total costs.

Finally, before signing at the notary, you must obtain an identification number for foreigners, which is a kind of resident card.

Stay a happy owner

Congratulations, you have become a happy owner in Spain! Then several questions arise: how to prepare the property for your arrival? Who will maintain a possible garden or pool? How to remotely manage a seasonal rental? Who will handle development and future maintenance? All this in a language you may not speak…

“Obviously you’re not going to jump on a plane every time you have to trim a hedge. We quickly realized that it was important to continue to support our customers after the acquisition. Today, we offer full after-sales service to make your second home a pleasure, not a burden. We even offer to furnish your new home to suit your tastes through our own furniture store, so all you have to do is pack your bags when you arrive and enjoy. We also provide seasonal rentals, which allows us to make real estate profitable. In this case, we support the owners in carrying out the necessary administrative procedures,” concludes Jonathan Bouchet.