FREQUENTLY ASKED QUESTIONS OF CALPE PROPERTY PURCHASERS
What is an NIE number and how do I get one?
In the same way that Spanish citizens have an identity card number, foreign property owners in Spain have an identity/tax number that is required by law. It is needed for most major transactions, for example, purchasing a property, opening a bank account, buying a car, taking a mortgage, paying taxes, registering with Social Security or applying for a drivers licence.
An NIE number can be applied for in the UK through a Spanish Consulate or it can be requested in Spain through an appointment at a National Police foreigners office. Appointments are currently running 6 weeks ahead. When the number is obtained, it is registered with the tax office and it is valid for life..
Which local schools are available?
Parents can choose between local municipal schools or private schools. Municipal schools in Calpe are the Azorin and Paternina Colleges that accept children in September, and from 4 years old. Municipal education is free of charge, apart from the cost of books, and they have assistance with Spanish for foreign students.
Costa Blanca private schools include the Lady Elizabeth School, Sierra Bernia and Elians British School starting at age 2 years+. Classes are usually bi-lingual and prepare for University entry and they also have bus services that stop at the central Calpe bus station each morning and afternoon.
Is it better to be Resident or Non-Resident?
If you live more than half the year in Spain, you are required by Spanish law to take residency (including tax residency). Income tax is paid in Spain with a certificate provided to the British tax authorities showing Spanish tax residency. It's quite normal to own a property without being Spanish Resident, and in fact most properties are held this way. If the property is sold, a British tax resident will have a 3% retention against the payment of capital gains tax, while a Spanish tax resident will declare the sale in their yearly tax return. Which system is most advantageous will depend on a person's particular situation and it would be recommendable to contact a fiscal advisor.
What is the reserve payment on a property?
This is a payment of €3.000 that has the dual function of 1) removing the property from sale for the period specified in the reserve and fixing the sales price 2) allowing the agency time to collect and check the documention of the property prior to the signature of the sales contract.
What are the extra costs of purchase?
The purchaser can calculate an extra 11% over the purchase price to cover Transfer Tax (Impuesto de Transmisiones Patrimoniales I.T.P, 10% of the purchase price) and notary and registry fees. If a lawyer is employed this will be an additional charge agreed separately. The agency fee is included in the purchase price.
What possibilities are there for work on the Costa Blanca?
There are plenty of foreigners working on the Costa Blanca for Spanish companies and on their own account. The position is straightforward for E.E.C. nationals who receive a work contract from their employer and a monthly pay slip (nomina). The employer pays their social security which covers health and pension rights and will arrange their enrolment in the Spanish social security system. All workers need a social security number and an N.I.E. number if they are foreigners.
The self employed need a license to carry out their activity, to be registered with the Social Security office, and present quarterly and annual tax returns. They pay social security as self-employed (autonomos) and also need an N.I.E. number.
Costa Blanca employment focuses on short and long term tourism (residents) with every kind of associated service. Languages are very useful.
What costs are associated with selling a property?
Vendors pay Plus Valia (a relatively small local town hall tax based on the catastral value and number of years of ownership) and they will pay a capital gains tax if they have a capital gain on the sale. They also need to provide an Energy certificate and Habitation Certificate (arranged by the agency).
Vendors pay the agency fee of 5% of the sales price + IVA .
Is it better to take out a mortgage in Spain or in my home country?
Buyers can take out a loan on property in their home country (and transfer the money to Spain) which may be cheaper since they are known to their bank. Alternatively a mortgage can be taken with a Spanish bank, who will check earnings and approve mortgages of up to 60% the purchase price with a fixed monthly repayment (revised upwards or downwards annually depending on interest rates). They loan is based on the report of their own valuer who visits the property.
It's not advisable to take out a foreign loan on a Spanish property as the costs are higher with extra delays and legal fees.
Do I need medical insurance or am I already covered in Spain?
E.E.C. nationals need to obtain an E-121 form before leaving permanently for Spain to allow them to transfer their national rights to equivalent rights under the Spanish social security system. With this form and a residence permit "Residencia" they can use the social security system in the same way as the Spanish and have their existing years of pension contributions count towards a Spanish pension.
Members of private pension schemes are not entitled to use the Spanish social security system and are advised to join one of the many Spanish private health insurance schemes.
Is the price negotiable?
Usually yes, but we recommend that you view properties and find one that you like prior to asking this question. Selling prices vary considerably and if a property is offered at an exceptionally good price with a number of interested parties it may be advisable to forego a negotiation and reserve it directly. Most Costa Blanca properties eventually sell at or near their true market price.
Do planning regulations affect my prospective property?
Most property is on urban land included in the town hall plan with infrastructure of roads, electricity and water supply and the house will have a white town hall plaque with the urbanization name, a letter and a number. There are certain basic rules about urban construction with regard to constructable meterages, distances from borders, heights and construction types.
Land that is qualified as rustic (rustico) is agricultural and is not zoned for construction although currently, a house can be built on 10.000+m2 and existing fincas can be renovated but not enlarged.
Can I build a swimming pool?
The answer is almost always yes, and it can be built up to the border of your property. An architects project and a building license are required.
Will I have to pay community charges?
These apply when properties form part of an urbanization or apartment block with shared community facilities like swimming pools, tennis, gardens or lifts. The purchaser becomes part of the community, and will be invited to annual community meetings. These approve the running of the community and a fix the annual community charge which will usually be paid in 2 or 3 parts. Depending on the size of the property owned it will have a larger or smaller community charge fixed as a percentage in the title deed. Individual villas don't have community charges.
What are the annual running costs of a Costa Blanca property?
Electricity and water charges are metered and are similar to the U.K.. If you use gas it is either bought by the bottle (small or large) with the larger bottles delivered by lorry and changed by the driver. Annual running costs for an average villa could be; Electricity € 720, Water € 150, Gas € 400, Rates € 800, Rubbish collection € 176 = Total € 2.246 p.a.
How long does a sale take to complete?
It depends on the wishes of the purchaser and the vendor with the timetable reflected in the contract. Usually it will be between 4 and 8 weeks although it can be quicker if both parties agree. A mortgage will extend the completion date by a month or so and an inheritance declaration could take an extra 2 months.
Do I require a lawyer?
The Miró agency is a government licensed agent (A.P.I. Agente de la Propiedad Inmobiliaria Nº 835) licensed to carry out conveyancing and other property transactions. However, property purchasers are welcome to employ a lawyer and the site provides a list of Calpe lawyers who are happy to assist the foreign buyer. In this case we provide the lawyer with all the documentation who will check it for the purchaser and also help with NIE numbers and changing utility bills.
Do you have a catalogue to send to us?
We stopped sending catalogues some years ago as we found that we can provide more accurate and up to date information with photos through our website, www.inmocostablanca.com.
Can I get broadband internet in my new property?
Calpe town centre now has new fibre optic cabling with the existing ADSL option still being reliable and fast. Optical cables are being extended to the urbanizations with planned coverage for all of Calpe. All properties have ADSL that works well, either through cables or microwave dishes.