What should you think about before investing in Spain?

ZAPINVEST, specialist in resale properties in Spain, advises and supports buyers before, during and after the purchase of a property.

What do you need to know if you want to invest in property in Spain? And what needs to be planned for this purchase to be a success? Jonathan Buchet, CEO of ZAPINVEST in Belgium, gives us some advice.

Long holidays are a great opportunity to enjoy life under the Iberian sun and find your own piece of paradise. Belgians who have fallen under the spell of Spain do not hesitate to invest in a second home. They are currently the second largest foreign buyers by number of inhabitants (after the Swedes), with 1,207 sales deeds registered in the first quarter of 2022.

“The coast is especially attractive to Belgians, which is why we have two local offices: in Torrevieja on the Costa Blanca and in Puerto de la Duquesa on the Costa del Sol, and in between we also cover the Costa Calida). Thus, we are close to our customers in Belgium (with offices in Liège, Brussels and Namur) and in Spain. This is important because we support buyers before and during the transaction, but often after. Because once a property has been bought, it needs to be maintained and why not make it profitable by renting it out when you don’t live in it, which can quickly become a headache given the distance,” says Jonathan Boucher, CEO of ZAPINVEST in Belgium.

Get ready to buy

“You should know that the Spanish market is very reactive. Belgians compete with potential buyers of other nationalities If you find a property from Belgium, by the time you organize a trip to visit it may already be sold. That’s why we help our clients define exactly what they are looking for in terms of style of property (new or old, house or apartment, with or without a pool, etc.), type of environment (waterfront, downtown, countryside…) and for what purpose (to live there in a boarding house, come on vacation with family, walk with friends …). Then we organize the trip by displaying the available properties in the program that match the search criteria. My advice, if you are going to Spain this summer and want to invest in a second home, think about what it should look like and make a list of important points. You can also discuss this with our bilingual local teams and make first visits. In terms of prices, the average m² is cheaper than in Belgium, but the trend is up and we think this will increase. So it’s better to act now to have better purchasing power. Next year you will certainly have fewer square meters with the same budget,” explains Jonathan Boucher.

Buy accompanied

If you are buying an existing property, you can try to negotiate a price. On the other hand, if you’re buying a new off-plan property, the promoters don’t make any discounts. In this case, you will sign a real estate reservation agreement in anticipation of a sales contract.

“With the local presence of three-quarters of ZAPINVEST’s bilingual team, we know the land very well and have built partnerships with developers who trust us to market the properties they build on the coast. A big advantage because we know about the possibilities very early. We also work with lawyers who prepare sales deeds. Unlike us, the case is prepared not by a notary, but by a lawyer. You should also know that for existing real estate there are no compromises, the deed of sale is signed directly. For new properties, a compromise is usually signed one month after booking. Then you need to pay in general from 30% to 40% of the amount, ”specifies Jonathan Boucher. “If you need a mortgage, you can go to a Belgian banker (who will mortgage your Belgian property) or a Spanish banker (who will mortgage your Spanish property).

If you buy new, the VAT rate is only 10% compared to 21% in Belgium. If the property already exists, the transfer right is 8-10% depending on the region.

Added to this is a registration fee of 1.5% and you will pay your lawyer 1.21% VAT. About 12-14% of the selling price must be included in the total cost.

Finally, before signing with a notary, you must obtain an identification number for foreigners, which is a kind of resident card.

Be the proud owner

Congratulations, you have become a proud owner in Spain! Then there are several questions: how to prepare the property for your arrival? Who will maintain a possible garden or pool? How to remotely manage seasonal rentals? Who will be involved in the development and further repair? And all this in a language you may not speak…

“Obviously you’re not going to jump on a plane every time you need to cut a hedge. We quickly learned the importance of continuing to support our customers after an acquisition. Today, we offer a full after-sales service to ensure that your second home remains a pleasure and does not become a burden. We even offer to furnish your new home to suit your tastes through our own furniture store, so you only need to pack your bags when you arrive and enjoy. We also manage seasonal rentals to make the property profitable. In this case, we support the owners in carrying out the necessary administrative procedures,” concludes Jonathan Boucher.