 Previous Advice
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Introduction:
This chapter deals with the most important aspects to be considered before buying a home.
It contains indications and recommendations that will help you to successfully fulfil your objective, that of buying your home.
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HOW MUCH CAN I AFFORD TO SPEND
The first thing to do before buying a home is to define an approximate budget.
The amount you spend on buying your home should not exceed 40% of your net monthly income.
Divide your net annual income by 12.
Calculate 40% of that monthly income (multiply it by 0.4): that is your “ideal monthly mortgage instalment”
Using that monthly figure, you now know the mortgage amount you can apply for.
You can add any cash you have saved to the mortgage.
You should also consider the the initial outlay in purchasing your home, which is between 10% and 12% of the price.
These costs must be paid at the start, and must be added to the selling price.
The price of the home you should look for is the amount of the mortgage plus your savings (which includes all the costs).
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DECIDE ON THE AREA
The first thing to do is decide on the area where you want to buy your home.
This decision will be influenced by emotional factors (proximity to parents, relatives, friends, the district where you “grew up”...) and objective factors (prices in the area, transport, parking, green areas, shopping centres, urban fixtures...). Both are equally important and should be taken into consideration, to ensure you make the right decision.
As regards the objective criteria, the following aspects should be weighed up:
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1. Access and the nearest means of transport to or from your workplace. This may lead to important savings in time and money.
2. Shops, food services and leisure centres.
3. Medical services.
4. Primary, secondary schools and nurseries, if you have children.
5. Parking.
6. Leisure areas, areas for enjoying outdoor activities, and sports complexes.
7. Urban planning or building of public works in the area may bring advantages or disadvantages to the home and its surroundings. The Local Council will provide you with this type of information. |
HOW TO MAKE YOUR SEARCH?
Once you have decided on the area and have a rough idea of the price of the home you want to buy, you will be in a better position to search. There are many different options: publications specialising in real estate offers, adverts in the newspaper, real estate supplements, municipal or regional services, real estate portals on the Internet, making enquiries in the area , or visiting a Real Estate Agent.
A good option is to visit a Real Estate Agent that is based in the area, as it is likely to have a wide offer of properties and be familiar with the prices.
Using the services of a Real Estate Agent does not make the property any more expensive. Usually, it is the seller who hires these services, which means that the seller is responsible for paying the fees.
Bear in mind that a Real Estate Agent may save you many comings and goings, and fruitless operations. If you give them a clear explanation of what you are looking for and the type of home you have in mind, the intervention of a professional can save you a lot of time.
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Back to "Previous advice" 
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There are certain issues you should consider before buying, to make sure that certain tiny details do not go unnoticed.
It is advisable not to take a decision on impulse; make a second visit to the home or as many visits as you need. This type of purchase is very important and so you should take your time. |
SURFACE AREA OF THE HOME
The surface area of the home is one of the most important aspects, although it is necessary to clarify some of the terms that are most commonly used.
Built surface area (metres built): this is the area of the home that includes all the elements such as walls, beams, party walls and terraces. This is usually the information shown in the blueprints.
Useful surface area (useful metres): this is the total surface area, without including the thickness of the walls, beams, party walls, .. It is usually about 15% less than the built surface area. In the case of terraces, if they are open, half their surface area is considered when calculating the useful surface area.
Total or computable surface area: this is the built surface area, plus the proportional part of common elements. Common elements are those which are for shared use by all the residents, such as the lobby, stairs, gardens... The built surface area with respect to the total surface area of the building, including common zones, is what defines the share of the home in the property owners’ expenses and constitutes the basis of the appraised value of the home.
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CHARACTERISTICS OF THE HOME
When one is standing before what may be his/her future home, the following aspects should be considered, among others:
The available space and layout of the home: the number of bedrooms and bathrooms, exterior windows in the rooms, corridors, halls, passageways, built-in cupboards and wardrobes, lumber rooms and other storage areas.
The direction in which the home faces: exterior rooms usually receive more natural Light, and interior rooms are often quieter. Rooms facing the inside of a block are usually very quiet. Homes that face south are usually in greater demand, due to the quality and quantity of natural light.
The building materials and finishes are a guarantee of safety, robustness and quality. Examine the paintwork, tiles, parquet, skirting boards, mouldings, etc.
The state of conservation of the individual and common elements, the building structure and the existence of cracks or damp.
Water circuit: check that the taps can be turned on simultaneously without the water flow being reduced and that the hot water system is in line with what you need.
The gas installation: whether it is natural gas, urban gas or butane gas, and whether the installation complies with the official guidelines. If it is not in order, the company will request you to make the appropriate changes
Electricity: check the sockets for household appliances, heating, air conditioning and ensure they are earthed.
Heating: whether there is heating and which type, central heating, hot air or individual heating.
Air conditioning or heat pump: whether it is pre-installed or installed, and whether the system is autonomous or centralised and whether the power is appropriate for the surface area and the orientation of the rooms that are to be heated.
Doors and windows: they must provide light, ventilation, visibility and heat insulation, to ensure comfort and energy savings.
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GARAGE
The garage is another important aspect that may have an influence on your decision to buy.
Bear the following in mind:
1. Ease of access to the garage: entrance, opening system...
2. Size of the space and ease of use.
3. Direct access from the garage to the apartment.
As far as the Land Registry is concerned, a garage is also a property, i.e., an urban space and tenement.
It may have two different legal situations:
1. It may be an inseparable annexe to the building. In this case, the owner of the home is also the owner of the parking space. In a deed, the parking space is normally designated as an inseparable part (a percentage) of the total land surface occupied by the garage. In the Land Registry only one entry is made, referring to the home and the parking space.
2. The other option is that it is an independent property and therefore must be purchased separately. However, to save costs, the same notarised document used to purchase the home can be used, specifying the purchase of one part of the building and also the purchase of the garage. In this case, there will be two entries in the Land Registry, one for each property.
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SUBSIDISED HOUSING AND FREE HOUSING
It may occur that the home you want to buy is a Subsides Home. This is usually referred to as VPO (Public Housing). This means that the promoter has applied for the aid and benefits granted by the public housing legislation.
In exchange for this aid in the project, the regulations limit the size of the homes and set the maximum selling price at a maximum yearly value (called module). There is also some type of restriction in the event of selling it, and rights of first refusal. Failure to comply with these limits may lead to government sanctions and make it necessary to return the aid granted.
• Subsidised housing may be included in public housing projects in which case the local, regional or central government is in charge of developing the project. The prices are adjusted and there are also benefits with respect to finance. The problem lies in accessing this type of home, as the demand for public housing is far greater than the existing supply.
• If the subsidised housing project is carried out by a private promoter, i.e., if aid is received for the project, this is known as a private development. In this case, there is also a maximum selling price. This type of aid varies from year to year depending on the budget and the housing policy of the state, region or local council. All those interested can approach these public bodies and find out about the situation, the conditions for applying and the benefits of public housing.
• Free housing, on the other hand, is housing that receives no official aid in which the promoter promotes and sells the property using its own resources. There is no limit to the price, which is only subject to market supply and demand.
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If you are buying the property through a Real Estate Agent, , they will inform your about the situation of the home, the formalities involved and the documents you must furnish. Otherwise, you should be informed of the previous checks that must be made to ensure that the transaction has a positive outcome.
LOCAL COUNCIL
One of the first items of information is to check the situation of the property as regards city planning. The aim is to ascertain whether future plans exist that are pending approval, at the public consultation phase or in the process of being executed that could affect the home or its surroundings, and alter the circumstances that affect your decision.
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LAND REGISTRY
This is an an official, public registry in which all acts and contracts related to property and other real estate rights are registered.
The Registry identifies the current owner and whether the property is encumbered by a mortgage or any other right, such as annotations of seizure, resolutory conditions, rights of usufruct, leases, purchase options, etc.
You should ensure that the home is not encumbered, i.e., that all taxes, census rights, seizure rights and judicial costs have been paid.
If the property is encumbered with a mortgage that you do not wish to take over from the seller, or with any other charge, the seller must cancel the mortgage or charge and enter this fact in the register before signing the deed of sale.
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PROPERTY OWNERS’ ASSOCIATION
You should ask the administrator of the property or the property-owners’ association for a certificate accrediting that all payments in favour of the association have been made for the property.
The Notary Public must declare that this certificate has been furnished. This will prevent property-owners who owe money to the association from selling their property without first paying off their debts.
Find out whether there are any amounts foreseen to be paid for extraordinary expenses, building or rehabilitation work, works on lifts or façades, etc. that may incur future costs that must be paid by the home owner, no matter who they may be.
Also, take into account the monthly association fee and the number of residents.
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TAXES PAYABLE ON THE HOME
All homes pay taxes, or rather, their owners pay them. It is important to ascertain the situation of the Property Tax receipts..
Check that all due payments have been made as the home must respond for the last two annual payments. The cadastral reference must be included in the deed and in all cases, it is necessary to register the operation in the Land Registry.
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DOCUMENTS TO BE REVIEWED BEFORE SIGNING THE DEED
If the home is a used home, before buying it, the following documents should be reviewed:
1. Title of ownership of the person selling the property.
2. Last annual Property Tax or Urban Contribution payment receipt.
3. Certificate issued by the property-owners’ association declaring the seller has paid all the association dues.
4. Ownership of the home and situation with respect to charges (Simple Note from the Land Registry).
5. Last payment receipts for services such as water, electricity, gas, etc.
6. ITE (Technical Building Inspection), regulating the conservation of buildings. This is compulsory in some regions of Spain in houses built more than 20 years ago.
If you are buying a home in a housing development, the available information will differ slightly, as there is no property-owners’ association, which is usually constituted once all the homes have been handed over. The Property Tax does not exist either, and only the original property may be registered in the Registry, without identifying all the homes, as the promoter has not yet made the Horizontal Property Division.
1. Name or company name of the promoter, address and particulars registered in the Mercantile Registry.
2. Location map of the building and the property.
3. Description of the home: useful surface area and services, common zones, security measures, etc.
4. Building materials.
5. Registration particulars of the property in the Land Registry.
6. Agreement, including the general and specific conditions (price, payment method, delivery term...).
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