The Country Property Buyers Guide by Villas & Fincas Andalusia
Contact me to sell my house
Selling a property in Spain with Villas & Fincas
Villas and Fincas has good knowledge of the local area and market, worked with several property surveyors and is therefore able to provide a accurate valuation on your property. We provide a clear and simple sales commission agreement, giving a description of the property and specifying the total selling price and commission for the completion of the sale. Any furniture, paintings or fittings included in (or excluded from) the selling price should be clearly described to prevent misunderstandings at the time of sale. The vendor is asked specifically not to withhold any important information with reference to the property and to provide a copy of all documents required by law. The vendor must be aware that by law we will keep all the data with reference to the property till 5 years after the sale.
Letter of intent
When we’ve come to an agreement with a purchase, Villas and Fincas will prepare a letter of intent, which will be signed by both parties. The letter of intent is a token of good will from both parties. It states the sales conditions and the time reserved for the purchaser’s lawyer to draw up a private purchase contract. Which is the next step: to exchange private contracts drafted and negotiated by respective lawyers and monitored by Villas and Fincas. This usually happens within two weeks after signing the letter of intent. In the private contract (contrato de compraventa, or contrato de opción de compra) the parties, the property, the price, the method of payment the date of completion, and other important conditions must be specified and described clearly and in detail. The completion normally takes place at a public notary when the possession is handed over to the purchaser and the balance of the purchase price is received by the vendor.
The Vendors Costs
Estate Agent's Commission is 5%, plus IVA. These costs can be deducted when calculating Capital Gains Tax.
Legal Fees Normally a standard lawyer's fee is 1% plus IVA and can be deducted when calculating Capital Gains Tax.
Capital Gains tax or Impuesto sobre el Incremento Patrimonial (Capital Gains tax):
21 % on the difference between the original purchase and current selling price. Both residents and non-residents have several possibilities for deductions. It goes too far to specify these here. It is best you ask your lawyer or fiscal adviser how to proceed.
When the vendor is a non-resident in Spain or a resident that cannot proove fiscal residency, the purchasers lawyer will withhold 3% of the purchase price and pay it directly to the Tax Office within a month as a payment in advance on account of Capital Gains Tax.
Municipal 'Plusvalia' Tax paid every time a property is transferred and based on the increase of the value of the land during the time that the seller has owned the property and calculated in accordance, it does not depend on the selling price. This payment is subject to negotiation between buyer and seller and should be stated in one of the clauses of the private contract as to who is responsible for this cost. If nothing is stated in the contract, by law the vendor is to pay this tax.
It is important to prepare for the sale in advance, to check the title deed and relevant documents to make it easier for the potential buyer and to smoothen the process. Choosing the right professionals to handle the sale is essential. Knowing all of the costs and taxes in advance is particularly recommended in order to avoid unexpected costs after the sale. It is also extremely helpful to have the following prepared:
- Make sure any home improvements, updates, extensions have been registered.
- Copies of most recent water, electricity and telephone bills and IBI bills.
- Rates, garbage collection, community regulations/statutes, alarm contract, insurance policy, building plans and administrative licenses.
- Title Deeds (Escritura).
- Indication of Plus Valía Tax from the townhall.
- Certificate from the Community of Owners.
THIS IS A GUIDE ONLY AND IS NOT TO BE TAKEN AS READ PLEASE CONSULT A LAWYER
Prepare your house for sale
You need to think of your house as a marketable commodity. Your goal is to get others to see it as their potential home, not yours. If you do not consciously make this decision, you can inadvertently create a situation where it takes longer to sell your property.
The first step in getting your home ready to sell is to "de-personalize" it. The reason you want to "de-personalize" your home is because you want buyers to view it as their potential home. When a potential homebuyer sees your family photos hanging on the wall, it puts your own brand on the home and momentarily shatters their illusions about owning the house so minimize your personal items.
Removing Clutter, Though You May Not Think of it as Clutter This is the hardest thing for most people to do because they are emotionally attached to everything in the house. After years of living in the same home, clutter collects in such a way that may not be evident to the homeowner. Take a step back and pretend you are a buyer. Let a friend help point out areas of clutter, let your agent help you, too. Particular areas to look at are the kitchen and cupboards, be ruthless! Many people have too much furniture in certain rooms – not too much for your own personal living needs – but too much to give the illusion of space that a homebuyer would like to see in your house.
Plumbing and Fixtures
All your sink fixtures should look shiny and new. If this cannot be accomplished by cleaning, buy new ones where needed, this can be accomplished inexpensively and they are fairly easy to install. Make sure all the hot and cold water knobs are easy to turn and that the faucets do not leak. Check to make sure you have good water pressure and that there are no stains on any of the porcelain.
Ceilings, Walls and Painting Check all the ceilings for water stains
Sometimes old leaks leave stains, even after you have repaired the leak. Of course, if you do have a leak, you will have to get it repaired, whether it is a plumbing problem or the roof leaks. You should do the same for walls, looking for not only stains, but also areas where dirt has accumulated and you just may not have noticed. Plus, you may have an outdated color scheme. Painting can be your best investment when selling your home. It is not a very expensive operation and often you can do it yourself but choose neutral colours off-white is normally best and makes rooms look larger.
Carpet and Flooring
Unless your carpet appears old and worn, or it is definitely an outdated style or color, you probably should do nothing more than hire a good carpet cleaner. If you do choose to replace it, do so with something inexpensive in a fairly neutral color. Repair or replace broken floor tiles, but do not spend a lot of money on anything. Remember, you are not fixing up the place for yourself. You want to move. Your goal is simply to have as few negative impressions upon those who may want to purchase your property.
Windows and Doors
Check all of your windows to make sure they open and close easily. Make sure there are no cracked or broken windowpanes. If there are, replace them before you begin showing your home. Do the same things with the doors - make sure they open and close properly, without creaking. Be sure the doorknobs turn easily, you want to do everything necessary to create a positive impression.
For those who smoke, you might want to minimize smoking indoors while trying to sell your home. You could also purchase an ozone spray that helps to remove odors without creating a masking odor. Pets of all kinds create odors that you may have become used to, but are immediately noticeable to those with more finely tuned olfactory senses. For those with cats, be sure to empty kitty litter boxes daily. There are also products that you can sprinkle in a layer below the kitty litter that helps to control odor. For those with dogs, keep the dog outdoors as much as possible. You might also try sprinkling carpet freshener on the carpet on a periodic basis.
Is your landscaping at least average? If it is not, buy a few bushes and plant them. Do not put in trees. Mature trees are expensive, and you will not get back your investment. Also, immature trees do not really add much to the appearance value of the home. If you have an area for flowers, buy mature colorful flowers and plant them. They add a splash of vibrancy and color, creating a favorable first impression. Do not buy bulbs or seeds and plant them as they will not mature fast enough to create the desired effect. Always rake up loose leaves and grass cuttings, keep your terraces and pool bright and clean.
The big decision is whether to paint or not to paint. When you look at your house from across the street, does it look tired and faded? If so, a paint job may be in order. It is often a very good investment and really spruces up the appearance of a house, adding euros to offers from potential homebuyers. When choosing a color, it should not be something garish and unusual, but a color that fits well in your neighborhood. Of course, the color also depends on the style of your house, too. For some reason, different shades of yellow seem to elicit the best response in homebuyers, whether it is in the trim or the basic color of the house.
When Your Selling Price is too High, Beware!
Beware of pricing your house to high. If you start out with too high a price on your home, you might miss out on the first buyers on the market and you may have just added to your stress level, and selling a home is stressful enough. It is the agent’s job to know the local market conditions and the actual values. If your house is dramatically above market value, why waste time? Your time and the potential purchaser’s time is better spent on houses that are priced realistically. If a mortgage is needed the house will be valued by an independent valuer. If comparable sales for the last six months and current market conditions do not support your sales price, the house won’t appraise. Your deal falls apart and your house will stay unsold. Villas and Fincas will give you the right price based on local experience with recent sales and valuations from mortgage banks.
We wish you good luck with this "getting your house ready to sell" operation and please call us for any further advice. We look forward to doing business with you.
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