What are the dos & don'ts, on buying an apartment in Tenerife?

dokgolf · 9th February 2010, 13:27

We hope to buy an apartment in the next 12 months, somewhere in the Canaries. What are the pitfalls e.g. are there extra taxes on top of the purchase price etc?

Thanks in advance
DOK

atlantico · 9th February 2010, 13:38

there's lots of 'extras' , try telling us the one's you already know about and maybe it'll narrow the list down a bit for us .

DJandDeid · 9th February 2010, 13:57

Biggest do is do your research. Research the areas you are looking at. Visit during the day and visit again at night as the impression can be very different. Do get a lawyer. Do research prices as they can vary hugely among estate agents for the same property. Do take your time. Do make sure what you want the apartment for (e.g. if you want to rent out or not). Do take account of the fact that you will get older and the three hundred and fifty two steps to the apartment may not be quite as manageable in ten years time. Do take your time.

Don't be pressurised into a purchase. They need you more than you need them, there will always be other properties. Don't leave your brain at home, there is a tendency among all of us to go into holiday mode. If you wouldn't buy without advice or professional help at home, don't do it in Tenerife.

Good luck with your search!

(try having a chat with CIM, he's got a wealth of info on costs and the process of purchasing)

Bhamannette · 9th February 2010, 13:58

A few are the agents fees, legal fees, non resident tax, rates, community fees, insurance.
If you go thru a good agent they should be able to tell you all this.

CressRT · 9th February 2010, 14:14

As a general rule expect to pay 10% for all the fees on top of the purchase price. You should NOT have to pay any fees for estate agents, thats for the seller; nor is there any reason to pay any of the sellers fees, in the past the Plus Valia (Spanish Capital Gains) was expected to be paid by the buyer but a change in the law clarified this.

C.I.M · 9th February 2010, 14:16

Where do we start??!

Legal and other costs will run to between 9% and 11% depending on whether you opt for a mortgage. You should use a independent lawyer (a good one who is not affiliated with the developer or agent you purchase from.)

Ensure nobody but your lawyer drafts the purchase contract and ensure your interests are represented.

Don´t hand over any cash to anyone - anything you pay - through your lawyer (companies go bust and your money can disappear - it happens...)
Don´t give power of attorney to anyone other than your own lawyer.
Take everything you are told with a pinch of salt (a largish one!)

Don´t make any quick decisions and don´t make them whilst you are here. Do your viewings, go home, have a think a bout it and then decide.

Don´t take anyone's word for anything - get it in writing. If something is promised - get it in writing, if there are existing rental bookings - get a copy of them. When you are told the community fees - ask for a copy. Also ask for a Nota Simple which gives you a good idea of debts secured against the property and any title issues (they are only about 15€ and can be ordered online.)

Avoid pokey little commercials which have been converted into apartments.
Do lots of research. Speak to people on the complex you are buying on etc etc.

Lots more but depends on what you intend to purchase and how.

Balcony · 9th February 2010, 16:31

Before you start looking, buy yourself the Sunday Times book 'Buying a Property in Spain' and read up. It has plenty of useful tips and facts.

Before you actually buy you will need to get an NIE (Numero de identificacion de Extranjeros), the equivalent to the NIF or Numero de Identificacion Fiscal borne by all adult Spaniards, your tax identification number. This is obtained from a police station. Then you will need a bank account to enable you to pay your regular bills in Tenerife.

When viewing make sure you take a camera and make photos as a reminder. Take pen and paper too. You may be exchanging all sorts of numbers etc.

Decide the type of area - resort, or nearby towns. Front line properties are generally more expensive, so decide on an acceptable distance from whatever is important to you...town centre, beach, buses, bar etc.

If there are some apartment complexes you like more than others then go to them and either ask at a reception area, or try to find a member of the apartment's Community and ask about annuals charges...expect to pay £1000+ each year in community fees. Usually this includes water charges. You can discount gas/electric charges at this stage. Also get a copy of the community rules.

Once you start to look at individual apartments make notes of what you see and list potential problems. Discard immediately those apartments you don't like, don't keep them on some sort of 'maybe later' list.

Take note, but don't place too much emphasis on what an agent says, especially anything about '...that will be happening etc' unless you can independently verify it and remember there are very few apartments that ever have the top 3 floors demolished!!! Open your eyes and look carefully. Likewise, remember too that people you talk to may also like to 'colour the landscape' so to speak, so always seek to verify what you are told.

For those apartments you like just hang around - pool bar, if it has one, or nearby cafes. Get a feel for the place.

Some agents are good at the paperwork following a purchase, but do some research on the agent too. Better still, use a lawyer.

atlantico · 9th February 2010, 17:44

don't give an estate agent the 10% deposit they'll ask for !

Its a buyers market, maybe give €1k as a holding deposit. (estate agents can/do go bust)

Get your Lawyer to check the property valuation for tax purposes. especially in this climate, the purchase price may be lower than valuation price but you still have to pay tax on the governments valuation figure. This can be adjusted but BEFORE you buy.

Get receipts for all bills paid up to date, including IBI (council tax), basura, Community fees, plus valia etc FIRST !

Brown mouse · 9th February 2010, 17:59

Quote:

Originally Posted by atlantico

don't give an estate agent the 10% deposit they'll ask for !

Its a buyers market, maybe give €1k as a holding deposit. (estate agents can/do go bust)

Get your Lawyer to check the property valuation for tax purposes. especially in this climate, the purchase price may be lower than valuation price but you still have to pay tax on the governments valuation figure. This can be adjusted but BEFORE you buy.

Get receipts for all bills paid up to date, including IBI (council tax), basura, Community fees, plus valia etc FIRST !

I believe the 10% deposit is mandatory but I agree with the estate agent not holding it and it should be held by the sellers Lawyer.

mpr001 · 9th February 2010, 18:02

Quote:

Originally Posted by dokgolf

we hope to buy an apartment in the next 12 months, somewhere in the canaries. What are the pitfalls e.g. Are there extra taxes on top of the purchase price etc?

Thanks in advance
dok

get a good solicitor