OFF PLAN PROPERTY VERSUS RESALE PROPERTY IN SPAIN
Spain is a great country with a good mix of fine weather, rich culture and idyllic beauty. No wonder that there is an increase in demand for property in Spain by foreign investors. There is a good demand for both off plan Spanish property and resale properties which include apartments, studios and villas for sale. So, if you are looking to buy property abroad, Spain can match your holiday and investment principles.
The main difference between Off Plan property and Resale property lies in ownership and issues regarding property, its completion and sale. If a buyer is provided with only a property plan and the property is sold even before construction, then it is said to be an off plan property. Off plan property in Spain is referred to as a new development. The finished property will only be a replica of the property plan. In today’s market most of the investment properties in Spain are sold even before the completion of construction. A resale property is one which is sold one or more times. An off plan property in Spain would be sold primarily by the property developers while resale property is sold by owners or agents.
When selling an off plan Spanish property, the developer’s initial interest would be in selling as many properties as possible in the new development. The greater the number of properties sold, the lesser the need to generate funds for developing the property. So, in the beginning the developer sets the price below the market price. However, during the construction process the price of the building might go higher than the market price. In the case of a resale property in Spain, price would be a fixed one or will be negotiated between the buyer and the seller. A contract has to be signed for off plan Spanish properties before the construction is completed. It is highly recommended to have a legal advisor during the process. A smaller deposit is made during the initial signing off while the remaining money is paid at the completion of the project.
On the other hand, in a resale property, one exactly knows what they are investing in. One has to have his cash ready if he wishes to invest in resale property in Spain as 10% of the price is placed as a deposit while the remaining 90% of the price is settled when the title deed is transferred. A thorough inspection has to be made before buying a resale property in Spain as sometimes modernization or renovation expenditure might cost you more than that of a new building.
When buying an off plan property in Spain, some developers help buyers in getting mortgage at banks. But in case of a resale property, the buyer has to arrange for finance on his own. The VAT for a new development is slightly higher than the transfer tax of resale property.
But as a buyer, you have to be very careful about the laws and regulations of the region. A Spanish lawyer who can speak your own language is highly recommended for both kinds of investment. The legal advisor can run a background check on the property, check for authentication of the title deed and other legal documents. Spanish mortgage is available for both new and resale properties. The mortgage amount depends on the value of the property. For instance, if it is a villa for sale in Spain, then its amount will be judged by its value and the general property market trends at that particular time. NIE number is the tax number that is required to buy a property in Spain.
In spite of these advantages, the annual investment on property in Spain has been decreasing for the past few years. The Spanish property inflation rates have been falling since 2003.
The main difference between Off Plan property and Resale property lies in ownership and issues regarding property, its completion and sale. If a buyer is provided with only a property plan and the property is sold even before construction, then it is said to be an off plan property. Off plan property in Spain is referred to as a new development. The finished property will only be a replica of the property plan. In today’s market most of the investment properties in Spain are sold even before the completion of construction. A resale property is one which is sold one or more times. An off plan property in Spain would be sold primarily by the property developers while resale property is sold by owners or agents.
When selling an off plan Spanish property, the developer’s initial interest would be in selling as many properties as possible in the new development. The greater the number of properties sold, the lesser the need to generate funds for developing the property. So, in the beginning the developer sets the price below the market price. However, during the construction process the price of the building might go higher than the market price. In the case of a resale property in Spain, price would be a fixed one or will be negotiated between the buyer and the seller. A contract has to be signed for off plan Spanish properties before the construction is completed. It is highly recommended to have a legal advisor during the process. A smaller deposit is made during the initial signing off while the remaining money is paid at the completion of the project.On the other hand, in a resale property, one exactly knows what they are investing in. One has to have his cash ready if he wishes to invest in resale property in Spain as 10% of the price is placed as a deposit while the remaining 90% of the price is settled when the title deed is transferred. A thorough inspection has to be made before buying a resale property in Spain as sometimes modernization or renovation expenditure might cost you more than that of a new building.
When buying an off plan property in Spain, some developers help buyers in getting mortgage at banks. But in case of a resale property, the buyer has to arrange for finance on his own. The VAT for a new development is slightly higher than the transfer tax of resale property.
But as a buyer, you have to be very careful about the laws and regulations of the region. A Spanish lawyer who can speak your own language is highly recommended for both kinds of investment. The legal advisor can run a background check on the property, check for authentication of the title deed and other legal documents. Spanish mortgage is available for both new and resale properties. The mortgage amount depends on the value of the property. For instance, if it is a villa for sale in Spain, then its amount will be judged by its value and the general property market trends at that particular time. NIE number is the tax number that is required to buy a property in Spain.
In spite of these advantages, the annual investment on property in Spain has been decreasing for the past few years. The Spanish property inflation rates have been falling since 2003.
posted by Property Alert at
1:57 AM
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