Some General Advice
Spain is an extremely popular destination for expats, looking for a pleasant climate and high standard of living. Whether you’re thinking of working in Spain, in one of the major cities, such as Madrid, Barcelona or Valencia, or retiring to the Spanish coast, you can find your perfect place in Spain.
If you’re thinking of making the move to Spain, you’ll need to find somewhere to live. While renting in Spain is a strong option, many foreigners choose to buy property if they’re going to stay in the long term.
At 78%, home ownership in Spain is above European averages, and the large expat communities scattered throughout Spain means that a high proportion of real estate is already foreign owned. In fact, in the first quarter of 2017 alone, nearly 15,000 homes were bought by foreigners.
Traditionally, Brits have been the largest single group of expats investing in Spanish property, but due to currency fluctuations and Brexit worries, buyer numbers from the UK have fallen. Nonetheless, more expats than ever are buying in Spain – making for a much more diversified group of foreign home owners.
If you’re thinking of doing the same, then you’ll need to know a bit about how the process of buying a home in Spain as an expat will work. Here’s a quick guide.
The Spanish property market was hit hard by the global economic crisis. In the years before the crisis, housing prices had been among the highest in Europe, with some areas seeing growth in the region of 250% in the 10 years prior to the crash. The Spanish coastal areas in particular saw surging prices, as people from Spain and beyond bought second homes, pushing prices up.
As Spain’s economy suffered in the economic crisis, so did the housing market, with a major readjustment. In fact, across the country, property prices on average lost around 40% of their value between the end of 2007 and the third quarter of 2015. This decline, naturally, hit some areas worse than others. Although year on year prices continued to fall, the decline started to slow after 2013, and demand is now beginning to grow again. Spain’s housing market returned to positive growth in the first part of 2016.
Spanish property is now starting to be seen by many as a strong investment. Because of this, foreign purchases have played a significant role in turning the Spanish property market around, with many expats buying homes in the major cities and along the coasts. This renewed interest has pushed up prices, and the outlook for 2017 is the same. It’s estimated that price growth will be in the region of 7% in Barcelona and 4% in Madrid over the course of the year. Across the country on average, the outlook is for growth of about 2%.
There are no special requirements nor paperwork for foreigners wishing to buy property in Spain, so you shouldn’t have any issues. In fact, foreign investment in Spanish property was traditionally encouraged by the government, although this became controversial during the crash, when foreign investors found themselves accused of profiting from the country’s woes.
With the uplift in prices, the climate for foreign investors looks strong once more.
If you’re thinking of buying a property in Spain, the price you pay will be influenced significantly by where you want to live. Some of the most expensive properties in the country can be found in Barcelona, with Madrid city centre prices falling a shade below this. However, if you want to live in the capital on a budget, you can decrease your housing costs considerably by looking to the suburbs instead of the city centre. In other areas of the country, such as the coastal regions, the wide variety of different housing on offer means you can find something to fit pretty much any budget.
Legal & Business Advice
When you’re setting up a business in Spain, there’s a considerable amount of paperwork to get through and you’re responsible for dealing with it correctly, as well as for obtaining the required licences and paying all necessary taxes on time.
There are no excuses for being a foreigner and not speaking the language. If you don’t comply, even through ignorance, you’re likely to be faced with large fines. It’s therefore imperative that you use professional help.
This can be a daunting task. Where do you start? How do you find a professional in Spain that can be relied upon? One of the best ways is to do as the Spanish do: judge by recommendation and reputation. This may be easier said than done when you’ve just arrived in the country and don’t even know where to go for a recommendation. However, if you’re doing your research thoroughly, you should come into contact with plenty of businesses similar to the one you’re planning to start. Ask the owners who they recommend; ask everyone you come into contact with, so that you have several different opinions. Then you will not only know the names of the most highly recommended advisers, but also the names of those to steer clear of.