1.-In this case the applicant has visit a property in a rural area of Mallorca. As it usually happens, the seller assures that everything is legal. The real estate agent is a salesperson hired by the seller and only has the information that the seller has provided.

Risk level: 8/10. Risk its HIGH as the property it’s located on High protected area, was enlarged after 1956, the plot is less than 14.000 square meters. That means every license has to be checked in Town Hall to be 100% sure permits where granted. In case was not, administration will never lose the order to demolish any part build after 1991.

Facts to be considered.

.- The Territorial Plan of Mallorca indicates that the property is located in an ANEI zone (Natural Area of Special Interest). This is a high protected area and according the Natural Areas Law (LEN) not dwellings may be build in that area. In general only those builded with or without license before 1956 or those that got a license before 1991, may be legal.

The fact that the property is located in a protected area does NOT imply that it is illegal. However, it is a risk factor that requires a detailed review of the licenses granted and the age of the property.

According to the Cadaster, the property has 98 square meters of dwelling and 58 of agricultural storage room.

Property Registry simple certificate says exactly the same; 98 square meters of dwelling and 58 square meters of agricultural storage room.

Cadaster also indicates the property was build in 1960. The aerial picture of 1956 shows it was some construction there, (right top corner) but does not fit with the actual. That means the original house has been enlarge. So the original house was there in 1956, but in some moment the house was enlarge up to the actual estatus.

Cadaster also indicates the property was build in 1960. The aerial picture of 1956 shows it was some construction there, (right top corner) but does not fit with the actual. That means the original house has been enlarge. So the original house was there in 1956, but in some moment the house was enlarge up to the actual estatus.

The only way to know it it’s checking all the licenses and files in Town Hall and comparing them with the reality.

Other details that catch my eye.
Cadastre and registration match. This is not usual in old constructions. I suspect that the house could have been registered in the land registry using the cadastre.
The cadastre and registry say that there are 58 meters of agricultural storage and nevertheless today all the construction is a dwelling.

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The post Example 1 of Provisional Risks Report o buying a Property in Mallorca. appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

As you can see if you follow this link, demolitions orders are real

The key is to know what the urban situation of the property is before signing the first document and to know the consequences in case there is any irregularity.

How do I know what the urban situation is?

Check it yourself. Following this link you will find some advice.
And if I can’t do it myself?
Engage an independent professional who has no relationship with the seller to do it for you.

Isn’t the seller obliged to tell the truth?

The seller should tell the truth, but often knows that if he/she does he/ she will not sell the property. In most cases the seller has no idea that there are irregularities in the property. In the past, it was not important.

And the real estate agent?

The agent works for the seller and has the information that the seller provides. If the seller doesn’t know, or is hiding it from him /her , real estate agent can’t tell the buyer.
Some agents know about town planning issues. Others are only commercials.

How complex is it? Look at this link and you will see the most common mistakes about the legality of a property.

Legality is the only thing to look at?

No. It is also important to make sure that there are no debts on the property and that the taxes have been properly paid. If not, the new owner may end up paying them.

The post 100% legal Property For Sale in Mallorca. appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

Being a foreign citizen buying a property in Mallorca, may seems to complicate without a guide. That’s why I offer here a comprehensive description of the basic steps to take, but also some important warnings that will avoid making mistakes.

Don’t be in a rush.

From the very first moment you will be surrounded of people pushing you to sign a commitment. Don’t trust them. Rush it’s your enemy and you have to take your time to compare and make the decision.

Trust me. Mallorca it’s full of properties for sale.

Learn to distinguish those who are on your side from those who only think about their commissions.

Property Finders, Real Estate Agents, Decorators, Builders, Consultan, Lawyers… the vast majority are great professionals, but beware because there are many among them who just want to take advantage.

Make sure whoever advises you is ONLY on your side.

How to distinguish them?
It’s simple. Being the only one who hires their services.
In Spanish there is a saying that says ” Poderoso Caballero es Don Dinero.” Powerful gentleman is Mr. Money.
When you have someone in front of you who convinces you to sign, ask yourself the following question.
Who pays him /her? If it’s you; trust him /her.
If the seller is paying him/her, look for an advisor who IS ONLY ON YOUR SIDE.

LEGALITY, LEGALITY, AND LEGALITY WHEN BUYING PROPERTY IN MALLORCA

Unfortunatly Mallorca is full of partial illegal properties and authorities had take the decision to end up with this practice. EVERY MONTH Consell de Mallorca orders to knock it down some propertyies and don’t expect vendor or his/her agent to tell you if the property you are buying it’s illegal.

Let’s be clear, buying a property in Mallorca, it’s always a good inversion and a great idea, but keep something in mind. The fact you are buying in front of a Public Notary and you will be able to inscribe in the Property Registry, doesent means property it’s 100% legal.

I suggest your to read this :

.-Can authorities demolish illegal property on Mallorca?

.-WARNING. War to illegal urbanism in Mallorca based on fines and demolitions.

.-The pursuit of urban illegality in Mallorca does not stop.

PROCESS OF BUYING A PROPERTY IN MALLORCA.

Process, as you can read in detail in this post, has 3 parts.

Before the purchase.

-Be sure this is your dreams home

-Ask an independent lawyer to check the legality, the possibility of development, charges and the real ownership of the property.

-Make an offer

-Sign an Option Contract to allow you time to get your NIE number, wire the funds to Spain, get a mortgage if needed and allow time to the vendor to move out of the property

Purchase

-Sign the purchase deed in front of a Public Notary and pay the price. In the Spanish system in order to be registered the purchase deed has to be signed in front of the Notary

After the Purchase

Pay purchase taxes, inscribe the property in the Land (Property) Registry, Inscribe the property in the Cadaster, change the supplies to your name, pay annual taxes…

The post Guide to buying a property in Mallorca, Spain 2020 appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

So, let me tell you what NOT TO DO if you are willing to buy a Property in Mallorca.

When you buy a property in Mallorca, Don’t be in a hurry.

Don’t let anyone pressure you. Most of my clients have been told that if they don’t sign a commitment immediately, they will lose the property of their dreams.
1.- Most of the time the only one who wants to close the deal is the middleman.
2.-Mallorca is full of properties for sale. Believe me, you are not taking the last one.

So, DO NOT SIGN ANY COMMITMENT WITHOUT BEING ADVISED.

Find here 10 essential things to check before buying a property in Mallorca

Before buying a property in Mallorca, check the legality.

Each year the Island Government of Mallorca orders the demolition of a hundred illegal constructions. So, before to go ahead, be sure your dreams house will not be your next nightmare. May be you don’t understand Spanish but you may take a look to the pictures of the demolitions ordered by the Agency of Defense of the Territory ADT
Don’t you believe me? Take a look at these articles.

.-Can Authorities demolish illegal property in Mallorca?

.-Consequences of illegal building works in Mallorca

Invest in an independent advisor.

Yes, the advisor is an investment, not an expense. A good advisor can save you money, but for sure will take away a lot of headaches.

Sooner or later someone will tell you that you do not need a specialized lawyer to buy in Mallorca.
Possibly the person who is telling you this does not want you to know something.
ARE YOU REALLY GOING TO BUY A PROPERTY IN A FOREIGN COUNTRY BASED ONLY ON THE INFORMATION GIVEN TO YOU BY THE SELLER OR HIS AGENT?

I’m not telling you to hire my services (buy you are welcome). Mallorca is full of advisors. Whichever one you choose will do a good job. But make sure that whoever advises you is INDEPENDENT.
How do I know who’s independent? If he/she only works for you, he /she independent. If he/she gets paid by both parties, or only by the seller, he/she can never be independent.

NOT ONLY LEGALITY

After the purchase you have to pay Transmission Tax or Vat.

Check taxes had been paid. Especially if vendor it’s non residen. If there are not paid taxes or not property paid tax office will claim to you.

If vendor it’s non residente you have to withhold 3% of the purchase price and send it to Tax Offices.

Property has to be inscribed on the Land registry and Cadaster.

Supplies has to be change at your name.

If your assets are big enough you have to pay Wealth tax.

Every year you have to pay taxes for owning a property in Spain.

The post Property for sale in Mallorca. appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

No. Any person is able to own a property in Spain, as long as he/she fulfills the Money Laundry regulations. It is very interesting to mention that for non EU-citizens, if they buy a property, making an investment of more than half a million euros, they can obtain a residence visa, called “the golden visa”, equivalent to the US green card.

Are real estate transactions in Mallorca typically handled by a notary or lawyer, and what is the cost for such services?

Both Lawyers and Public notaries are involved in real estate transactions in Mallorca.
On top of the purchase price, the purchaser should add approx. 10% additional for taxes and expenses

Buyer’s lawyer check the ownership of the properties, charges and encumbrances, deal with vendor’s lawyer regarding way of payment, prepare the contract and the most important: check the legality of the property.

Then the purchase deed has to be signed in front of a Public Notary to be registered in the Property Registry. In the Spanish system Property Registry only inscribes notary deeds.

The fees of the Notary depend on the purchase price of the property.

Note in Mallorca the prices of properties vary from 180.000 euros for small apartment to 10 million euros or more for a luxus single family house with pool in a privileged area.

The Chamber of Lawyers of Balearic Island recommend their associates to invoice 1% of the purchase price + VAT (21%), but sometimes the fees are higher because the lawyer’s fees depend on the purchase price of the property, the complexity of the deal and the effective work done. Note that sometimes it is necessary to establish a company structure to minimize in a legal way the tax impact of the purchase, in order to optimize the wealth and the inheritance tax, among others.

I always recommend our clients to close a budget prior to hiring our services.

When buying a property in Mallorca, who pays for the notary and/or lawyer (buyer, seller or both)?

When buying a property in Mallorca all the expenses of the purchase are usually paid by the buyer except the “Plusvalía municipal”, which is a municipal tax related to the increase of value of the plot on the time the vendor has been owning the property.

That means the buyer will pay the notary, property registry, lawyer’s fees and transfer tax

Lawyer: Each party hire and pay his own lawyer.

Contract has to be negotiated and a lawyer may not be able to represent both interests. So each one pays his lawyer.

What are the costs paid by the buyer?

The tax issue when buying a property in Mallorca is the following:
There are two escenarios:
a) A new property being sold, the buyer pays on top of the purchase price 10% VAT plus 1.2% Stamp Duty Tax.
b) Second hand property. In this case buyer pays transmission tax, ITP (Impuesto de Transmisiones Patrimoniales).
This tax is progressive and has to be calculated step by step
For the tranche from 1 euro to 400.000 euro euros buyer pays 8%. From 400.001 to 600.000 euros, buyer pays 9%, from 600.001 to 1.000.000 euros buyer pays 10%, and up to 1.000.000 buyer pays 11%

So, transmission tax for 185.000 euros will be 14.800
And transmission tax for 2.350.000 euros, will be 238.500 euros

Besides this, the buyer will pay Notary and Property Registry fees, depending of the purchase price, but all together start from 600 euros, raising up depending on the purchase price.
Then 1% of purchase price + VAT cover lawyer’s fees

Can foreigners obtain mortgages to buy a property in Mallorca? How easy or difficult?

Yes they can and in fact it’s very common client ask the Lawyer to help getting a mortgage to buy a property in Mallorca.
Getting a mortgage depends of the negotiation with bank but normally foreign will get only 60% to 70% of the highest value between purchase price and valuation price. Local people can obtain up to 80%.

Despite of this foreign, as locals too, have to prove their solvency, this means they will be able to pay the mortgage’s installments.
So the borrower of the loan hast to present to the bank the last 2 yearly income tax declarations and the last 6 month of payrolls, bank movements, certificate of debts, certificate of other mortgages or loan, tax payment of last year and any other document that helps bank to prove buyer will be able to attend the quotas.
The process for foreign citizens is more or less similar to locals. The difference is all documents has to be translated into Spanish or English.
No. Basic rules are the same. There are only some minor differences in the taxation in the 15 regions of Spain

Are there any special laws about acquiring real estate in Mallorca different from the rest of Spain?

Yes, in Balear Islands there is something essential: The war against illegal constructions, mainly in Mallorca.

After 50 years of laxity with illegalities, now Mallorca’s government (Consell de Mallorca) has taken very seriously this matter and they have decided to battle new illegal constructions; they are searching for those illegalities done on the last decades.

The recently created corporation called “Agencia de Defensa del Territory” Territory Defense Agency, who acts as a building police looks for those illegalities. If the illegality has not prescribed they order the demolition and if it has prescribed they open a file and the owner will never be able to get a license on the property unless legalizes the illegal parts.

The fact is that thousands of properties have some illegal part or some are 100% illegal.
Problems comes when one of those properties enter into the market for being sold and the purchaser is not correctly informed from the vendor or the Real Estate Agency about the existing legalities of the property.
So, the purchaser sometimes is pushed to sign a contract in a very short period of time under the pressure there is someone else interested in buying the same property the purchaser is looking at, and the purchaser feels being in a middle of a race.

You may imagine the situation: the vendor tries that the buyer signs a document declaring that he/she knows and accepts the legal situation of the property in order to avoid problems. Some Real Estate Agencies usually don’t do a proper research about the illegalities and push to speed up the process in order to avoid loosing the deal and their commission.
And in the middle of this mess, despite I’m a Lawyer I feel I’m a detective who has to find out hidden illegalities, in order to inform properly my client about the legal status of the property.
In this process we always check all the documentation of the property and we inspect it personally, in order to reconfirm that what’s written on the documents match with the reality.

Final recommendations to buy in Mallorca to summarize.

.- Be on the safe side and get an independent advice. Avoid any adviser recommended by the selling party.
.- In this adventure rush is your enemy, so take your time. In many cases vendor promises there is someone else interesting in buying the property. This is a way to push the purchaser to stop investigating and sign the contract as soon is possible.

The post Buying property in Mallorca. FAQ appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

Important notice:
Sometimes things are not what they seem and the buyer’s lawyer has no choice but to advise his/her client not to buy that property.
Whoever is advising you on your purchase, make sure he/she will be able to give that advice.
I’m not telling you to hire my services. Mallorca is full of professional and trustworthy lawyers. But don’t make the mistake of letting someone related to the seller or the agent (paid for by the seller) advise you. If it is the case that something is wrong, neither of them will advise you not to buy the property.

So, get an independent advisor who works ONLY FOR YOU and has no commitment to the seller.

COSTS OF REAL ESTATE LAWYER IN MALLORCA FOR BUYING A PROPERTY

Regarding the fees it’s very important to know lawyers fees are free. That means lawyer may invoice whatever he/she consider it’s fear. That’s why, before hire one, it’s recommended to ask him/her to confirm the deal and know how much is gonna be the final invoice.

Chamber of Lawyers of Balear Island’s recommends invoice 1% + VAT of the purchase price.

Despite of this the fee may be negotiated. In my case I’m flexible depending of the complexity and risks of the case.

If you send me a Whatsaap (+34 678216706) or mail now I’ll forward you an estimate.

The post Lawyer fees when buying a property in Mallorca. appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

Buying a property abroad, doesn’t mean you have to be a cash buyer. In fact is becoming more common for my clients to finance the purchase of their new home in Mallorca with a mortgage.

How do I know which mortgage is best for me?

Comparing and negotiating with several banks. I’m working with principals national and international banks based on Mallorca and I’ll provide you the different rates and offers to be compared.

At this point it’s very IMPORTANT to clarify I commit myself to do not take any commission for that. Any bank offers a commission to the lawyer, economist or intermediary who bring them a client. Despite this is regulated and it’s totally legal I don’t consider it’s fair to get a commission on something my client pays for, so, I’ll never accept that commission and I’ll ask the bank to deduct it to the client instead of being paid to me.

I charge my fees to my clients, but I never get commissions.

What do I need to get a mortgage in Mallorca?

Bank need to be sure you will be able to pay your quotas so you need to provide.

1. 1. .-Financial situation. Normally last 6 months status of your bank account it’s enough

1. 1. .- Your last payrolls if you are active worker

1. 1. .-Certificate of other debts (mortgage, loans etc)

1. .- Your annual tax payment

Timing to get a mortgage

Once this information has been sent to the bank, they will study it and in more or less 3 weeks we will know if mortgage will be granted.

Then a valuator of the bank has to visit the property in order to establish the value. This may take anther 3 weeks until the mortgage it’s granted.

Costs:

The mortgage is a parallel operation to the purchase. It is signed before a notary in a different deed and entails the payment of taxes and expenses.

The post Financing your property purchase in Mallorca or elsewhere in Spain. appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

Find here the elementals Rules About Buying a Property in Mallorca.

DEPOSIT: The vendor, or Estate Agent will recommend you sign an Option Contract as soon as possible in order to be sure nobody else can buy that property. Don’t play this game. This may be the first essential rule about buying a property in Mallorca : Don’t let anyone push you around. Offer a €500 to €4000 deposit to the vendor to hold the property for a few days (let’s say a week) and to prepare a Option Contract. The vendor has to commit to keeping the property off the market for a few days; the deposit you pay for this will be part of the Option Contract you are going to sign. If the vendor does not agree go to the next point.

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-GET INDEPENDENT ADVICE (from a Lawyer):

Real Estate Agents are efficient and honest, but their main objective is to sell properties as quickly as possible before other agents can do the same. In case they have a conflict of interest, don’t forget they get their commission from the vendor and not from you. So, look for someone who has no other interests than yours. This is the second basic rule about buying a property in Mallorca: Be sure that whoever advises you is independent of the vendor and works only for you.

Your lawyer, as your adviser has to investigate important legal issues in local administration and deal with local people (neighbors, community of owners etc.) hire a lawyer who is established in the local area with contacts there. There is no sense hiring a lawyer in Madrid if you are buying a property in Mallorca, or hiring a lawyer who does not speak Spanish or Catalan to deal with the locals and neighbours in rural areas.

What can lawyer do for you when buying a property in Mallorca?

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-GET A NIE NUMBER.

The day you go to sign the purchase deed in front of a Notary, you must have your Fiscal Identify Number. Without it you cannot pay taxes in Spain. We will apply for one through the Chambers of Lawyers. As this sometimes takes 4 weeks, it is advisable to request one as soon as possible. So, once you are sure you are going to buy a property in Spain, request a NIE number.

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-PREPARE THE OPTION / RESERVE CONTRACT:

We will prepare the Option / Reserve Contract in Spanish and English. This document –which is binding for both parties – will establish the terms and conditions of the purchase.

We will check:

a) The real ownership of the property. By checking the Property Registry we will find out who the real owner is. We will also identify any third person who has a right to this property as a right of way, right of use, usufruct etc…

b) The legality of the property. Lots of properties, especially in rural areas have illegal parts. If this cannot be checked immediately, your lawyer will ask the vendor to prove the legality of the property before signing the purchase deed.

Illegalities are not only in rural areas; your new apartment in town could have an illegal terrace, or a room that was built on a terrace without a licence, or a third person with rights to or interests in the property.

Read this post if you want to know more about illegalities and risks.

c) Debts. Your lawyer will check whether the property has any debts with institutions (taxes), easements, mortgages with banks or particulars, or with the Community of Owners. When you have bought a property you are responsible for the debts from the previous three years with the Community of Owners. Therefore, it is very important to be sure all bills have been paid.

Once again, if it is not possible to check this before signing the Option Contract, your lawyer will ask the vendor to prove the absence of any debts on the property.

d) Price: If necessary, your lawyer can provide you with an appraisal report in order to be sure the price asked by the vendor is in line with the market.

-SIGN AN OPTION CONTRACT:

Your lawyer will prepare a contract outlining the terms and conditions of the future sale. The vendor will prove the legality of the property, deliver all the necessary documents, prove there are no debts, and provide efficiency energetic certificate of the property, as well as the most recent paid-in-full supply receipts, tax receipts etc.

This contract will set the purchase price and date of completion, as well as establishing what will happen in case any party does not comply with the stipulated items in the Purchase Option.

Only YOUR LAWYER will protect your interests and guarantee the return of the option premium if the property is not in perfect condition.

When the Option Contract is signed, you, as the purchaser, have to pay the deposit as the option price. The amount will be set by both parties, but usually it is 5 or 10% of the purchase price. Normally the vendor holds the deposit, but if both parties agree, it can be also held in a notary’s escrow bank account or in a lawyer’s bank account.

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-SIGN THE PURCHASE DEED:

The purchase deed is signed in front of a public Notary and the full price is paid at that moment. On the same day the purchaser gets all the documents relating to the property and the keys, and becomes the new owner.

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DONE?

Not yet…Now you can enjoy your new property, but there are still more things to do.

–Property Registry: Once we got the purchase deed from the Notary it must be sent to the Property Registry, where you will be entered as the new owner. The same goes for the Cadastre. You become the legal owner the day you sign the deed, but in order to make this information public it must be entered in the Property Register and the Cadastre.

-Also, if you buy a property in a complex you need to inform the Community of Owners and provide a bank account number in order to pay the community bills.

-Supplies: The water, power and gas supply contracts must be put in your name as soon as possible.

-Taxes and expenses.

Read my post about taxes and expenses when you buy a property in Mallorca.

 Toni Marqués. Real Estate specialist

Don’t hesitate to contact me for free information.  +34 678 216 706   toni@palmalawyers.com

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Toni Marqués. Real Estate specialist

Don’t hesitate to contact me for free information.  +34 678 216 706   toni@palmalawyers.com

The post Toni Marques. Abogado appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.

First, consider whether you can answer these questions for yourself. If you are familiar with them, you do not need to hire a solicitor to buy or sell your property.
1.-TAXES
What taxes I have to pay for the purchase, in what time and how much I will pay?
What taxes or fees I will pay annually once I have purchased my property?

I’d better put it in my name, together with my partner or maybe it’s better to put the property in my heirs’ name?

Don’t hesitate to contact me for free information.
Toni Marqués. Real Estate Solicitor in Mallorca.
toni@palmalawyers.com….WhatsApp: (+34)678216706

2.- LEGALITY OF THE PROPERTY
Verify that the seller is the legal owner. Sometimes selles has a real right on the property, but not 100% ownership. 

Verify that the property is free of encumbrances, liens or mortgages.

Verification that the real surface, the registry and the cadastral area coincide. In cases of disagreement know the consequences.

Check whether the built volume is habitable or intended for other uses. Many times part of the construction (in rustic and urban), is a storeroom and therefore uninhabitable.

Check if the reforms have been made with a license.
Check whether the reform coincides with the licence requested in the town hall.

Check whether once the renovation was completed, the vendor got the certificate of town hall.

Debts with the community of neighbours, files of infreaction in the Town hall etc…

3.-CONSEQUENCES
Buying a property that has burdens, hidden faults or does not comply with urban legality can be a real nightmare for the new owner.
From never being able to apply for a reform license to ever be forced to demolish the illegality.

Don’t hesitate to contact me for free information.
Toni Marqués. Real Estate Solicitor in Mallorca.
toni@palmalawyers.com….WhatsApp: (+34)678216706

The post Why hire a lawyer when buying a property in Mallorca ? appeared first on Toni Marqués. Real Estate Solicitor. Mallorca.