Buying Guide Details

Buying Property on the Costa del Sol

Costa del Sol as seen from a luxury hilltop villa

The glorious year-round climate, numerous sandy beaches, loads of sport and leisure activities and a well-established British expat community are still very appealing to anyone looking for property on the Costa del Sol. With over 50 golf courses in the area there is plenty of choice of property on the Costa del Sol overlooking a fairway and the weather provides fantastic playing conditions twelve months a year.

Where to buy property on the Costa del Sol

If you’re a property buyer looking for property on a budget, your best bets on the Costa del Sol are now to invest in the lesser known resorts and inland locations. The established coastal resorts like Marbella, Fuengirola and Estepona do continue to draw overseas property buyers to the area but prices have risen dramatically over the past decade or so.

There’s increasing interest in more authentically Spanish locations such as Antequera, Coin and Ronda, inland but still within easy reach of the beaches if you want to take a dip in the Mediterranean. While prices may be cheaper away from the coast, it’s worth bearing in mind that the whole area is relatively expensive by Spanish standards.

An expensive property on the Costa del Sol can, of course, be a sound investment. There will always be demand for good property in the best locations, and while the days of making a quick buck on the Costa del Sol are over, a property in a chic location like Puerto Banus near Marbella, though undoubtedly expensive, will make an excellent long-term investment prospect.

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The Process of Buying Property on the Costa del Sol

Anyone wishing to buy (or sell) a property on the Costa del Sol must first obtain from the state – in person – a fiscal number for foreigners known as NIE (numero de identificacion de extranjeros)
Once the property buyer has received the NIE number, the property buyer’s lawyers can make an offer on their behalf. When a price has been agreed, it is recommended that both parties sign a preliminary agreement which outlines details such as the completion date
A deposit of 10% is the normal amount placed to secure the deal. After this, if the property buyer pulls out they lose the full deposit but, should the seller decide not to go ahead, he/she must return double the amount of the deposit – i.e. 20% – to the buyer
If buying property on the Costa del Sol off-plan, it is usual for payments to be broken into stages, the balance being paid when construction finishes
On completion, when all the necessary checks have been carried out, both parties sign the escritura (title deeds) in the presence of a notary. The property buyer then pays the balance, plus all other fees and taxes. Copies of the deeds are sent to the Land Registry and the tax office.

Homes Overseas Property Club

Homes Overseas has joined forces with a collection of IFA specialists to form the Homes Overseas Property Club (HOPC), designed for existing and prospective overseas property homeowners.

The Club – which has access to international lawyers in no fewer than 43 different countries - has been set up in order to guide people through some of the various issues relating to buying and maintaining a property overseas. It offers advice on a range of topics, including financial, legal, insurance, taxation, property management and foreign currency matters.

For further information please telephone 0845 838 7142 or email info@homesoverseaspropertyclub.com

Fees & Taxes

Taxes and fees usually amount to around 10% of the total purchase price of the property on the Costa del Sol
Taxes payable depend on whether the property on the Costa del Sol being purchased is new-build or resale. Currently, transfer tax of around 7% is applied on resales, which includes stamp duty. For new-build properties, VAT (IVA) of 7% is payable in addition to 1% stamp duty
On top of this there is also plusvalia (capital gains tax), which is set by the local authorities and depends on the area concerned and the amount of profit being made on the sale. This is usually paid by the seller
If the property buyer is purchasing land or commercial property on the Costa del Sol rather than residential property the Costa del Sol, VAT is 16% as opposed to 7%. Stamp duty remains the same
Most Spanish lawyers charge around 1% of the final purchase price, and notary fees are around 0.5%
Agents’ fees can vary anywhere between 2% and 15% – so be careful not to be ripped off

Getting there

Malaga is served by a host of airlines from many regional airports in the UK year-round For the western part of the coast, it might be better to fly to Gibraltar.

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