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BUYING A PROPERTY IN ELVIRIA
Introduction– Buying Property in Elviria
Elviria – Our Opinion
Our Recommended Developments
Villas
Must See & Do / Nearby
Before You Buy
The Buying Process
Post-Completion
Spanish Lawyers
Currency Exchange
Spanish Mortgages
Finance & Mortgage Summary
Contents
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IntroduCtIon- BuYInG ProPertY In eLVIrIA
So you’re thinking about buying a property in Elviria. Prospective buyers usually
have a multitude of questions, and our Buying Guide goes a long way to
answering most of those questions, and is sectioned into an easy menu so that
you can quickly and easily find the answers you are looking for. From tips on how
to find the most reliable and efficient professionals to money-saving hints on how
to obtain the best mortgages or rates of exchange, our guide covers a variety
of topics.
Our ‘Before You Buy’ section provides advice on how to tackle fundamental
issues such as choosing the most suitable location and property experts in Elviria,
together with tips on how to effectively conduct your search for that perfect Elviria
property.
The ‘Buying Process’ covers everything you need to know about the mechanics
of buying a property in the area, from dealing with contracts and completion to
managing the costs of purchasing a Spanish property and the ways in which a
local lawyer can often simplify this process.
Our guide also covers post-completion issues such as opening bank accounts,
paying the bills and furnishing your new property, while separate sections offer
advice and guidance on the key areas of the Spanish legal process, foreign
currency exchange and Spanish mortgages.
1
eLVIrIAour oPInIonLocated 12 kilometres east of the centre of Marbella
and just 35 minutes from Malaga International Airport,
Elviria is an area that has grown considerably during
the last 15 years. One of Elviria’s major attractions is its
long, sandy beach, undoubtedly one of the finest in
Marbella, and its wealth of amenities and facilities.
Elviria’s most recognisable building, the towering 5
star Don Carlos Hotel, is also one of its oldest, and still
counts many of the world’s rich and famous amongst
its guests, including the King & Queen of Spain. The
hotel’s magnificent gardens lead down to its own
Beach Club, which neighbours the famous Nikki Beach
resort, where the glamorous jet-set party the days and
nights away.
One of Elviria’s unique attractions is the wealth of shops
and commercial amenities within the immediate
vicinity of the coastal area. Three shopping areas offer
supermarkets, banks, a huge choice of restaurants
and bars, plus access to buses and taxis.
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Slightly inland from the beach and shops lies the Santa Maria Golf Club, with its
18 hole course that snakes across the valleys above the resort. With a little more
land to play with, this area is home to luxury villas and apartments, many with
great golf and coastal views.
Just 8 minutes drive inland from the beach you will find the area of La Mairena,
offering some of the most dramatic views on the Costa del Sol. From here, approx.
400 metres above the sea, you can see the bay of Fuengirola, the snow-topped
Sierra Nevada mountains near Granada, and even the planes coming in to land
at Malaga Airport! For nature lovers, and those who want a little more peace and
quiet than the coastal developments, La Mairena is a great choice.
Elviria in general is a great all-round area, ideal for permanent residents due to
the wealth of amenities and easy access to local schools, plus an ideal base for
a fabulous holiday, with close proximity to top class golf and beaches.
our reCoMMended deVeLoPMents
3
Name Type of Properties Price Guide (approx)
Selling Points
Romana Playa Studios,Apartments
from€99.000
• Beachfront Development.• WalktoShops & Restaurants.• GreatRental Potential.
Los Jardinesde Don Carlos
Apartments,Penthouses
from€200.000
• 2ndLineBeach.• WalktoShops & Restaurants.• GreatRental Potential.
Hacienda Playa Apartments,Penthouses
from€350.000
• Beachfront Development.• SpaciousProperties.• LuxuryDevelopment.
Los Patiosde Santa Maria
Apartments,Penthouses
from€160.000
• NexttoGolf Clubhouse.• WalktoBeach, Shops & Restaurants.• GreatRental Potential.
Hacienda Elviria Apartments,Penthouses
from€280.000
• LuxuryDevelopment.• WalktoGolf,Beach & Amenities.• SpaciousProperties.
Name Type of Properties Price Guide (approx)
Selling Points
Elviria Hills Apartments,Penthouses
from€320.000
• On-siteGolfCourse, Tennis & Restaurant.• LuxuryDevelopment.• GreatViews.
Las Terrazasde Santa Maria
Apartments,Penthouses
from€260.000
• GreatViews.• Award-Winning Development.• ShortDriveto Amenities.
El Soto deMarbella
Apartments,Penthouses
from€160.000
• GreatViews.• On-siteGolf& Clubhouse.• Spacious Properties.
El Vicario Apartments,Penthouses
from€150.000
• GreatViews.• LargeTerraces& Private Gardens.• ShortDrivetoGolf.
La Florestade La Mairena
Apartments,Penthouses
from€175.000
• GreatViews.• NewConstruction.• ShortDrivetoGolf.
VILLAs
There is a wide range of villas to choose from in Elviria.
Of course, due to the price and availability of prime
beachside plots, villas on the beach are few and
far between, but as you head into the hills, there are
many more options. Some of the older villas near the
amenities are built on relatively small plots, and you
could expect to pay from €400.000 for a 2/3 bed home
on a plot of around 400m2.
There is a good selection of 4/5 bed villas with private
pools built within the last 10 years in the price bracket of
€500k - €1 million, and if you really fancy splashing out,
what about an 8 bedroom mansion with panoramic
sea views, built on a plot of 32,000 square metres?
Yours for just under €6 million.
4
Must see & do…
•Takealeisurelystrollalongthelongsandybeach.
•Play18holesatSantaMariaGolf.
•HavelunchatthefabulousBeachHouseRestaurant.
•EnjoyaCaféconLecheatCasiCasi,Elviria’soriginalbar.
•TaketheshortdriveupthehilltoLaMairenaandsoakinthoseviews.
neArBY…
•CheckoutthemarinaandbeachesatnearbyCabopino.
•TakethebackroadacrossthemountaintoLaCalaGolfResort,Europe’slargest.
•ShoptilyoudropatnearbyLaCañadaShoppingMall.
5
Before You BuY
There are plenty of things to consider before buying a
property in Spain! There are the obvious matters that
need careful consideration, such as exact location,
type of property and budget, but then you will need
to choose a professional agent to provide a showcase
of suitable properties that match these criteria, and
then make the arrangements to actually visit the area.
Furthermore, when you ultimately find that perfect
place, you will then need to know what is required to
make it yours.
• HowshouldIchoosethebestlocation?
• HowshouldIdeterminemybudget?
• HowshouldIchooseanagent?
• Whatisthebestwayofviewingproperties?
• WhatshouldIdoifIseeapropertyIlike?
• WhatshouldItakewithme?
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How should I determine my budget?
It is important to have an idea of the budget for your property purchase before
you set out looking. Many people use a combination of cash or equity release
(remortgage) from their existing property together with a Spanish mortgage to
finance the purchase of their Spanish property. The mortgage rates in Spain are
at an historically low level, and many people are using these low rate mortgage
products rather than using all of their hard-earned cash. Your budget may also
be affected by the rental potential of your property. Very often, the income
generated from 10 weeks rental of your property can be enough to cover over 6
months worth of mortgage payments on your property in Spain.
We have selected a small number of specialists in the areas of Spanish
mortgages, equity release (re-mortgages) and general financial advice to
answer any questions you may have before determining your budget. For further
information, please consult our Spanish Mortgage section.
Why choose Cloud Nine Spain?
If you are looking to buy a property in Spain, it is important to choose an honest
and reputable agent to assist you. With the huge choice of agents in Spain
together with the numerous exhibitions and press advertisements at home, this
alone can be a daunting process. Cloud Nine Spain has been established for
12 years here on the Costa del Sol, so we have seen good times and bad!. We
pride ourselves on a service to clients that reflects our own high standards of
professionalism, honesty and integrity. What’s more, we have access to ALL of the
properties for sale via the agents’ shared databases, so we can offer you access
to literally thousands of properties.
What is the best way of viewing properties?
Viewing visits are the easiest way of seeing your
shortlist of properties in Elviria (and neighbouring
areas). At Cloud Nine Spain, we don’t offer subsidised
Viewing Trips. Very often, when a trip is subsidised by
an agent, you can find that you have little control over
your itinerary.
We feel it’s vital to have some time away from our
Property Consultant so that you can discuss what you
have seen in an objective manner. Depending upon
the area and selection criteria, 2 - 3 night visits are
normally adequate.
Before your arrival, one of our Property Consultants will
have spent time with you on the phone discussing all
of your criteria, and should have prepared a shortlist
of suitable properties in time for your arrival in Spain.
Many buyers try to ‘do it themselves’ and deal with
lots of different agents when they come to Spain
independently in search of property. An independent
visit is not a bad idea in itself, but a combination of
agents can lead to confusion, as most of the agents
can offer you the same portfolio of properties. Cloud
Nine Spain enjoys unlimited access to the main
networks and multiple listing systems, providing access
to ALL available properties in the area.
What should I do if I see a property I like?
People are often ill-prepared to act if they see a property that they actually like.
In the Spanish property market, particularly when buying from a developer, there
will be no emotional bond between buyer and seller, so it will very often be a
case of ‘first-come, first-served’.
In the case of resale properties, generally if you see a property that you like, your
agent will forward an offer on your behalf, and once the offer is accepted, you
will need to pay a reservation deposit (normally in the region of 3,000 - 6,000
euros) in order to secure the property and take it off the market. Sometimes,
developers will allow you to reserve a property overnight, or for a few hours, so
that you can mull things over in peace. In some circumstances, a reservation
deposit is refundable within 30 days if you happen to change your mind. Check
all of these details with your agent.
What should I take with me?
You have selected your chosen area, you have an ideal budget, and you have
seen the perfect place. What will you need to secure the property?
Normally, reservations are taken on a credit card, so it is often a good idea to
inform your credit company before leaving home that you may be making
a transaction whilst you are away. Paying a reservation deposit by cheque or
bank transfer can delay matters by more than a week, and most developers
and vendors will be reluctant to accept this method of payment, as there may
be other people able to place an instant deposit on the same property.
To reserve a Spanish property, apart from a credit card, developers or vendor
agents will require a copy of your passport and all personal contact details.
7
the BuYInG ProCess
Although the process of buying a property in Spain
can seem daunting to most people, the reality is that
with the right help and advice, and by working with
the right people, this process should be relatively
straightforward. By understanding the role of lawyers
in Spain, together with the various stages and costs of
the purchase, you will be fully prepared for a stress-free
transaction.
• WillIneedaLawyerinSpain?
• DoIneedtocheckmycontract?
• Whathappensatcompletion?
• Whatarethecostsofbuying a property in Spain?
Will I need a Lawyer in Spain?
Once you have chosen your property in Spain and paid your reservation
deposit, you should then seek the assistance of a lawyer (our section on Spanish
Lawyers provides detailed information and advice). The lawyer will liaise with
you during the course of the purchase, reminding you when payments are due
and checking that contracts and deeds are all in order before signing on your
behalf or asking you to sign the documents.
Do I need to check my contract?
Between paying your reservation deposit and signing private purchase contracts
(normally a period of 7-28 days), your lawyer will check the contract to ensure
that the property you are buying is free of debt, legally owned and (in the
event of buying off-plan from a developer) that bank guarantees are in place
to protect your funds in the unlikely event of the developers going bankrupt.
Once the lawyer is happy with the contract, he/she will then ask you to transfer
your funds to their client account in Spain. We would advise using a currency
exchange specialist if you are a citizen of a non-euro country.
The amount of money required at this stage depends on the type of property
that you are buying in Spain. Very often for resale properties in Spain, 10% of the
purchase price is due at this stage. When purchasing off-plan property from a
developer in Spain, the payment terms will dictate the amount due at this stage.
This figure normally varies between 20% and 50%.
Once the lawyer has received your funds together with the signed contract, your
payment will be forwarded to the developer or the vendor. The signed contract
will set out when further payments are due, and will also include a forecasted
completion date.
What happens at completion?
When you are buying a resale property in Spain,
completion normally takes place within 6 weeks of
signing contracts. This gives buyers enough time to
arrange a mortgage and organise finances, furniture
etc. When buying off-plan property in Spain, there
may sometimes be interim payments due prior to
completion, or simply the remainder of the funds
payable at completion (this will depend upon the
payment terms in the contract).
Before arranging completion of your Spanish property,
your lawyer will check that the description of the
property matches the one provided in the contract
as described by the vendor or developer, and that a
licence of first occupancy has been granted (in the
case of off-plan properties). Once the lawyer is happy
with the property, he/she will ask you for the funds due
at that point, and will liaise with your lender regarding
any mortgage that you wish to take out on the property.
Once the funds have been received by the lawyer, you
will sign the title deeds, either in person, or by power of
attorney with your lawyer in Spain, and the property is
then legally yours.
In addition, to become the owner of a property in
Spain, you will need an NIE number or certificate.
These are issued by the local police station, and your
lawyer will normally be able to arrange this on your
behalf, although he/she will probably require a power
of attorney unless you want to attend the police station
in person, often a laborious and time-consuming task.
What are the costs of buying a property in Spain?
Normally, if you allow for a figure of around 10% - 12% of the purchase price,
this will cover the costs of purchasing a property in Spain. This figure comprises
legal fees which normally account for 1%, transfer tax on resale properties of 8%
(slightly higher for properties priced in excess of €400.000), plus notary fees, land
registry fees and stamp duty. In the case of new developments and off-plan
purchases, there is no transfer tax to pay, but you will instead need to pay 10%
IVA (similar to VAT) plus Stamp Duty, therefore raising the total purchase costs to
around 13% - 15% of the price.
If buying with a Spanish mortgage, there will also be fees associated with the
mortgage, such as stamp duty and arrangement fees.
8
Post-CoMPLetIon
How do I organise utility contracts?
There are several things that can only be arranged
once you become the legal owner of your property in
Spain. Once you have signed the title deeds, you will
be able to apply for utility contracts such as water and
electricity, and set up direct debits to ensure these bills
are paid. This is something that your lawyer in Spain
can organise on your behalf.
How do I set up a bank account?
Your lawyer will also be able to help you in setting up
your bank account and arranging home insurance
for your property in Spain. This is a simple process.
How do I arrange the furnishing of
my property in Spain?
Furnishing your property can often seem like a chore,
but many buyers simply instruct a home furnishings
company to do the job for them a few months or
weeks prior to completion. Obviously this will depend
on the reasons for the purchase. If you are buying the
property purely as an investment, you may prefer to
take a hands-off approach to furnishing the property.
However, most buyers enlist the help of a furniture
specialist and also shop around for some items
themselves. We can recommend several furniture
specialists that can cater for all tastes and budgets.
9
sPAnIsh LAwYers
When buying a Spanish property, it is vital that you use a qualified lawyer in
Spain. The legal system in Spain is different to that of any other European country,
and its complexities can sometimes baffle buyers who try to ‘do it themselves’.
What are the costs?
Lawyers in Spain generally charge 1% (plus iva) of the property price for their
services. This may appear expensive, but it’s best to treat this as an important
investment to safeguard your funds and to provide peace of mind.
Who should I choose?
Your lawyer should speak your native language, but be based in Spain. He/she
may be recommended to you by your agent, or you may have been referred
to your lawyer via friends or colleagues who have bought a Spanish property
in the past. The lawyer should be independent, not working for the vendor or
developers.
What does the lawyer do?
Please consult the information in the BUYING PROCESS
part of this guide
Do I need to be in Spain to sign the Contract
or Title Deeds?
When buying a Spanish property, you can arrange
a Power of Attorney with your lawyer in Spain. This
document is signed by you and gives your lawyer
power to act on your behalf in relation to the purchase
of your property, meaning that he/she can sign
documents on your behalf. This means that there is
no need to personally be present when contracts or
deeds are signed. Many of our clients based outside
of Spain find this to be the simplest way of handling the
transaction.
What else can my lawyer in Spain do for me?
Lawyers in Spain are accustomed to people from all
over the world buying property in their country, so
they understand how difficult the process can at first
appear.
Your lawyer can assist with making wills, opening
bank accounts, arranging utility contracts and direct
debits, arranging property insurance and liaising with
developers regarding ‘snagging’ issues. Your lawyer in
Spain may also be able to provide useful introductions
to Spanish mortgage providers and lenders.
10
CurrenCY exChAnGe
This section is relevant for those buyers from outside the
euro-zone seeking to purchase property in Spain.
Should I use a specialist firm to convert my currency?
The slightest changes in the currency rates can affect
the cost of your property in Spain. For a Spanish
property priced at 200,000 euros, a difference in the
exchange rate of just 1 cent could cost or save you
over 1,000 euros on the transaction. That 1,000 euros is
surely better being in your pocket!
Banks and currency exchange specialists all buy
and sell currency in bulk, and so are able to offer
much better rates than the day-to-day tourist rates.
While banks engage in other business, exchange
companies specialise in one area and can often beat
the bank quotes.
How do I actually transfer my money?
Once you have decided to use a foreign exchange company, you will need to
sign and complete their standard compliance forms, and then simply inform
them of the amount you need to transfer and provide the details of the destination
account in Spain. They will then tell you the rate that they could achieve, and
if you are happy with that, they will ask you to transfer the funds to their own
holding account. The funds will be transferred at the rate agreed and the euros
will be on their way to Spain.
Can I guarantee an exchange rate?
There are various ways of determining and fixing a rate for future transfers. This
is very useful if you feel that the currency market may dip, particularly if you are
making staged payments to a developer to buy a property in Spain. We would
advise you to discuss this with your currency consultant.
11
sPAnIsh MortGAGes
How much can I borrow in Spain?
Spanish mortgages are normally available (subject
to status) for non-residents up to 70% of valuation of
the property, though the vast majority lenders prefer to
work on the basis of 70% of the actual selling price (if it
is lower than the valuation price). Indeed, some banks
have recently withdrawn lending at 70% and prefer
to offer maximum mortgages of 60% of the purchase
price.
What mortgage interest rates are available?
Spanish mortgage rates vary depending on the type
of product and are based upon the EURIBOR rate -
check with our mortgage experts for the exact figure,
as this changes regularly.
What type of mortgage products
are available in Spain?
The mortgage market in Spain isn’t as sophisticated
as in other countries. The vast majority of Spanish
mortgages are simple capital and interest repayment
mortgages. Since the credit crunch, there are fewer
mortgage products available, so don’t expect interest-
only, fixed rate or self-cert mortgage deals in Spain.
Can I re-mortgage at home to buy a property in Spain?
Yes, you can, as long as there is sufficient equity in your property at home and
your lender agrees to provide funds.
Is it possible to obtain 100% finance on my Spanish property?
It is true that some Spanish banks are sometimes willing to offer 100% Spanish
mortgages to buyers on their key-ready, unsold developments. BUT, please
beware, as sometimes you can purchase cheaper properties within the same
developments by simply shopping around the resale property market and
finding a vendor who is willing to sell at a good price. Occasionally, we are able
to access genuine 100%-financed key-ready developments at discounted prices,
and these are always highlighted on our website at www.cloudninespain.com
What paperwork do I need to produce to apply for
a mortgage in Spain?
Generally, the banks in Spain will require at least 3
months wageslips, P60 and 3 months bank statements.
If self-employed, you will need to produce a set of your
last accounts. Banks in Spain will also require a credit
check of all applicants.
I have a developer’s mortgage already in place. Is
there any point in looking at alternatives?
Most developers arrange finance when they acquire
a project. You will still need to prove your income at
the time of completion. Sometimes, these developers’
mortgages may contain adverse terms or conditions,
so our advice is to shop around so that you have a few
alternatives to consider.
What do the banks charge for arrangement fees?
All banks have arrangement fees, and these vary from
lender to lender, and can be negotiable on occasion.
What do the banks charge for valuation fees?
The valuation fee varies from lender to lender, but 0.1%
of the valuation is the average.
12
fInAnCe & MortGAGes suMMArY
BACKGROUND
Immediately following the onslaught of the credit crunch in 2007, the banks
here in Spain became very reluctant to lend money. From the heady days of
the property boom in which Spanish banks would be happy to offer massive
mortgages to anyone who could produce a P45 (even if it proved to be fake!),
suddenly everyone seemed to realise what had been happening. Where once
the banks would assume that the value of a property would rise by 20% per
annum, now they couldn’t be so sure. In fact the banks became so scared of
exposing themselves to further bad debt that unless a buyer could present a
squeaky-clean credit history and a 50% deposit, access to Spanish mortgages
was strictly off-limits.
CURRENT SITUATION
Thankfully, the Spanish mortgage market has since eased, and most banks now
have lending targets that they try to meet in each branch. However, whereas in
the past the paperwork would often be overlooked, now buyers need to produce
all the necessary documents such as payslips or company accounts, P60, bank
statements, details of existing liabilities, and a credit check.
Most Spanish banks are able to lend up to 60% - 70% of the valuation of a property
to non-residents. They will be reluctant to go any higher than 70% because they
simply don’t want to over-expose themselves to the potential for further losses. If
the valuation comes back to the bank as being higher than the purchase price,
then the latter figure will normally be the one that the bank will use to base their
lending. Gone are the days of gearing up the finance on the back of an inflated
valuation I’m afraid!
INTEREST-ONLY MORTGAGES
For those buyers seeking an interest-only mortgage in
Spain, these are now hard to find. Most bank personnel
along the costas simply don’t understand the notion of
only paying the interest on a mortgage. Occasionally,
they may offer a limited period of a ‘carencia’ (which
amounts to the same thing), but normally they will
need a very good reason to do so, and usually this
type of product would only be made available to
residents. The banks flirted with interest-only products
before the credit crunch kicked in, but overseas buyers
will need to accept that their Spanish mortgage will be
a very straight-forward capital and interest repayment
product.
MORTGAGE TERM
Mortgages in Spain are normally available for up to
30 years with the maximum age for an applicant at
completion of the mortgage term being 70.
INTEREST RATES
Interest rates have been historically low here in Spain
for some time, and most mortgage products will attract
a variable interest rate of over and above the 12 month
Euribor. Check with us or your Mortgage Consultant for
the latest rates.
FEES & TAXES
Set-up fees and taxes for Spanish mortgages can be fairly hefty, and can add an
additional 2%-3% of the purchase price of the property to the overall costs.
100% MORTGAGES
Having said all of this, there are also opportunities to secure up to a 100%
mortgage in Spain, but normally only when buying a property owned directly by
a bank. For those who don’t want to use any of their hard-earned cash, this can
be ideal. BUT, please bear in mind that the properties in question have normally
either been re-possessed by the bank or form part of a development that the
bank has been financing. In either scenario, with the help of an experienced
real estate agent, you may be able to find properties within the same (or
neighbouring) developments at a lower price than you would be paying. The
downside of course is that you would only be able to borrow up to 70% of the
purchase price in the case of finding an alternative. Occasionally, we are able to
access genuine 100%-financed key-ready developments at discounted prices,
and these are always highlighted on our website at www.cloudninespain.com
For further information or advice on buying a property in Spain, please contact
us at [email protected] or consult our website for updates.
www.cloudninespain.com
