Buy property in Tenerife - Very important tips .
Buy property in Tenerife with many investigator insider tips to
avoid bad decisions, tears, sleepless nights and financial loss.
The investigator is not an estate agent.
Her knowledge is based on 10 years of experience in Tenerife and in other countries.
Want to buy a holiday home?
Congratulations to your decision.
Cheap Tenerife flights
Your own place in Tenerife is your best ticket to uncomplicated, cheap holidays, as super cheap airlines are there to stay.
Want to employ an agent or buy directly?
A proper real estate agent is not charging you commission.
No, it's not that cheap.
He isn't working for free. Of course, his fee which isn't little is already included in the property sales price.
It sure helps to have seen the following
Documents to buy property in Tenerife
- Copia Simple or certified Copia Simple (cost about EU 35)
must be in the name/ names of the vendor/vendors
which will also show any debts or mortgages bound to the sale's object. Street names must be stated or, an acceptable graphic of property location when in a hotel which is all obtainable at the local town hall.
An apartment bought may not have a floor number registered. Even, when misunderstandings can't be because, no other unsold apartments are around there must be a number. This may take time to get entered into the computer data of the property which is needed both at municipal level as well as at the property registry office. Small hassles, but annoying nevertheless...
Not to be forgotten are little details when you want to buy property in Tenerife such as:
- Address of what you want to buy must be correctly stated in Copia Simple.
- Apply for Nota Simple (proof of registration of
vendor's deed) at Oficina de Registro ( registry for ownership of property).This is usually not at the mayor's office or town hall. In case that you also want to get a bond this may
be cleared by your bank or similar financial institution where
you apply for your mortgage.
You can have this agreement prepared.
Have included in the Promesa de Compra-Venta that below mentioned conditions must be fulfilled before the signing of the deed of sale. This also must include the grant of your mortgage.
2nd important document when you intend to buy property in Tenerife
- Promise to sell/buy property in Tenerife (promesa de compraventa) which must be signed by all parties
with all important data including all names of buyers and vendors, price, and when to be bought.
- You will need a valid passport to apply for the NIE number without which no home ownership in Spain is possible.
Don't let yourself be tricked or rushed into signing this first document.
- When changing your mind of buying you will lose your deposit (down payment) which is normally 10% of sale's price or 20% when buying off plan)
- Make sure that there is a similar clause which will cover you in case the vendor doesn't want to sell any more.
- Constructor's insurance for newly built homes; cracks and faults that may only appear much later.
A penthouse with a very large tiled balcony has a tiled and
cracked floor. The faults were only showing 3 years later after the owner moved in. There was no builder's insurance. Taking the builder to court for it might not be worth effort and, expenses.
Such an insurance must exist, also, when you want to buy off plan before a building has been started.
- Apply for your mortgage in Spain or in your home country (flexible or fixed as soon as possible)
- Open bank account as soon as you have your NIE number and find out from your overseas bank how and how fast they
can transfer money for you. There is the possibility to use escrow services which I would discuss with an expert.
Main document when you buy property in Tenerife
Deed of Sales (Compra-Venta de escritura)
This is the most important and final document (except perhaps a home insurance) when you want to buy property in Tenerife.
- Deed of sale must include all important data such as names, address, price, eventual 'uso fructo' (when the property is bought in names of children for example which allows a 3rd party to live in it and eventually more). It should also give the square meters of the property and/or age of property. It should also state that all outstanding debts as well as municipal tax has been paid up.
- A mortgage of the vendor will be taken off on day of deed signing at the notary. The seller never sees this money.
- You must bring your passport and NIE certificate with you to the public Notary to buy property in Tenerife.
- Get a bank certified check that will be handed over when signing the deed of sale.
Please bear in mind that 5% of the price you pay will automatically be held back by the bank to send to the receiver of revenue if the seller is not a Spanish resident.
- You may ask the notary for a 'borado' of the deed of sale( a 'borado' is not the final version) prior to exchange of signatures by yourself and the vendor.
You may take it to an authorized translator. This will help you to best understand the total content of the deed.
The translation might cost you between EU 35 and EU 50.
What will be your total cost you will have to add on to the purchase price when you buy property in Tenerife?
Expect about 11% of the sale's price for everything except charges by a lawyer, translators, tax consultants or gestorias(agents who handle all sorts of documentation).
Final costs to buy property in Tenerife to be expected are:
- 6.5% I.T.P (transfer cost) for resale property (not newly built or off plan) which is to be paid within 2 weeks at the Oficina del Registro (land registry)where you also apply for your Nota Simple (which proves that your property has been duly registered in a buyer's name.
- Note please that Pro or Plus Valia Tax is now always to be paid by vendor. This was not the case before. This tax varies from town to town or, from district to district.
- 7% ( kind of a value added tax) for new properties and land in the Canary Islands
- However, 21% is the same tax which must be paid outside the Canary Islands, such as on mainland Spain; hence it's cheaper to buy new in Tenerife which is part of Canarias.
- documentation tax 0,75%
- stamp duty
- notary fee for setting up deed of sale document.
Please, note that all documents may be handled and signed for and on your or seller's behalf by an estate agent, lawyer or, financial adviser by power of attorney( authority given by the buyer or seller to do so).
It is officially illegal to under-declare a sale's price. Nevertheless, it is still very much practiced in the Canary Islands. But, bear in mind, that under- declaring a sale's price in the deed of sale (escritura) might cause problems for you.
You may also appoint a lawyer who will charge you for total handling 1 - 1,5%. A recommended tax consultant is another option.
They could arrange water, electricity and perhaps even telephone connection for you.
Such services are offered by Tenerife property management companies, as well..
When you want to buy Tenerife property please, mind Tenerife advantages to save money on living costs and many others. VAT called I.G.I.C. in Tenerife only being 5% is just one of them.<
In case that it goes up slightly will mean that it still stays cheaper than on mainland Spain.
A 'so called insider tip' for buying property
Somebody suggested to buy property in Tenerife at an intrinsic value of 70 % of the asked price. This business attitude borders
on 'Highway robbery' in relation to real estate in my mind. Besides, remember:'What comes around goes around'...
The vendor might have bought at a highly inflated price and his money lenders might not have noticed.
Therefore, consider carefully before getting villas or apartments which have been on foreclosure.
However, taking over the buyer's mortgage could be an advantage when you buy property in Tenerife.
What to mind when buying Tenerife real estate
- Blunt house flipping which can cost extra tax
- Have Tenerife renovating fun for yourself in the first place
- Avoid negative property buying conditions...
- How stay clear of fraud with Tenerife and Spain property...
- Avoid problems that were hidden such as by wall to wall carpets.
- Your responsibility for the vendors debts.
- A roof must not be faulty to leak sooner or later
- Mind wall dampness
- Learn about the difference between structural or just hair cracks
- Important bar gossips on planned changes of a neighbourhood,
as you wouldn't like a main road going through your swimming pool
- Stay clear off seasides by law
- Mind building regulations with Tenerife houses
- Read up on more news of March 2008 on illegal building in rustic zones by newsinthesun.com
- Engage your own building or ground inspector or surveyor for an impartial opinion about a property you want
- Beware rural properties or country estates. They sometimes come without existing title deeds.
- Consider a project manager for building alterations which is an extra expense that should pay off
- Don't wait longuer to buy property in Tenerife. Live well now and not later which may be too late...
Romantic Tenerife apartment
Buy directly from owner...
Much money may be saved, when you buy Tenerife properties direct from owner, such as with this
romantic apartment by Puerto de la Cruz of Tenerife
Tenerife property los Gigantes
with flair and stunning views.
Most Important Tenerife buying links
Laws in Spain are always altered. Therefor, consult a lawyer who knows all about the latest Tenerife property laws to avoid doubts and to be absolutely safe. Nor the author of this article nor what is expressed in links can be taken for 100 % reality as everything on the island is subject to change.
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