Please note this web page is not intended to provide legal advice and is not exhaustive in covering the topics included. Regard the information as a simple guide on how things are done when buying property in Spain.
Estate Agent Commissions.
The commissions that Spanish estate agents charge varies considerably. At the lowest end of the scale, when a Spanish estate agent is selling a property owned by a Spaniard to a Spanish purchaser in an area where there is little or no interest from foreign purchasers the estate agent may charge as little as 2% to the seller and 2% to the buyer. In these cases property prices are low, there are few purchasers (properties may be on the market for years), there are no language difficulties and both the seller and buyer are familiar with the sales process.
At the top end, when properties are being marketed almost exclusively at "rich foreigners" the commission charged may be as high as 15% or even 17.5%, paid exclusively by the buyer. Estate agents justify the high commission levels because they may be dealing with a seller of one nationality, i.e. German, and a buyer of another nationality, i.e. British, in Spain, thus dealing in three languages. They also quote high international advertising costs, that the buyer's legal costs are included within their commission and sometimes the costs of flying and accommodating customers coming to view properties. Add on to this the probability that the property being sold is already "high cost" and you could be looking at substantial commission payments.
The average commission paid to estate agents in Spain is 6% and so reasonable commissions to expect when buying a property in Spain lie between 6 and 10%, some estate agents cap their commissions at a maximum figure say 5,000€. Quite often different properties with the same estate agent have differing commissions payable.
Estate agents rarely publish their commission rates but you are quite entitled to ask what the commission is on any particular property and there is no reason why you cannot haggle over the commission you are being asked to pay, just as you negotiate the property price.
Spanish Property Lawyers.
Some Spanish estate agents and property consultants include legal services within their commissions. You should refuse to pay this and find your own independent legal advice.
A Spanish lawyer acting on your behalf will either charge you a fixed fee, from 500 Euros upwards, or around 1% of the property sale price.
Notario or Notary Fees.
A Notario or Notary, is a government employed legal expert whose primary function with regard to property sales is to make sure that the:
1. form of the sales contract is legal,
2. contract has been signed by the seller and buyer; and
3. purchaser and seller are made aware of their tax obligations
with regard to the sale.
The fees charged by the Notary work on a sliding scale determined by the area of land sold, the size of the house and its price. Typically the cost of the Notary lies from 300 to 600€.
Property Registry Fee
There is a fee for registering your new property in your name at the local Registro de la Propiedad, this again will lie in the 300 to 600€ range.
If the property you are buying is not already connected to mains electricity or water you will be charged around 300 Euros by each supply company when you connection is completed. These charges are in addition to those that your builder will charge for laying cables, pipes etc.
You should allow 10% on top of your property costs (including agents fees) to cover such things as legal fees, transfer tax, notary fees, land registration fees and other minor expenses (changing electric, rates etc.). Normally when buying a cave house you can come well within that 10% and so should have money left over for furnishings and the like.
Allow a 10% Contingency
You would be wise to put a further 10% away to cover those things that nobody has thought of. If you stretch your budget to the very limit and an unexpected cost arises you could find yourself short of cash. If nothing unexpected occurs you still have your 10% contingency for a holiday or the grandkids or whatever.