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This article is the first of four that deal with selling real estate in Mallorca: What steps are to be taken before the notary appointment, who is involved in the sales process, how much it costs, and what pitfalls should be avoided. How long does the entire process take? Which taxes are due?
The beginning is certainly no different from what you're used to at home: decisions have to be made, such as what price is right, whether to hire a real estate agent or not, and when in the year is best to sell...
In Mallorca, second homes are almost exclusively offered through real estate agents. You can show the property to various agents, have them check the desired price, and commission one or more of them to sell the property. In Spain, the real estate agent's commission is paid by the seller and usually amounts in Mallorca to between 4 and 6% of the sales price plus 21% VAT. A good real estate agent will ask for documents at this stage because they need to make sure that they are all there, that the square meters registered in the land register correspond to reality, etc., so that there are no surprises later on.
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The moment one of the viewings shows interest and comes a second time, the agent usually asks for a price offer. If the offer does not correspond to the full amount, the seller makes a counter offer and this can go on for several rounds. Most negotiations then end with a price agreement.
At this point, a buyer's lawyer usually comes into the picture, especially if the buyers are not residents of Mallorca. The seller usually also has a representative, e.g. the one who handles the annual non-resident tax and property tax in Mallorca (someone like me...). These two experts then usually take over the further discussions.
The buyer would like to see the following documents through his lawyer:
* Seller’s personal details – Spanish NIE number and valid identity card or passport
* Current property register extract of the residence and all other elements with their own cadastral number to be transferred at the same time - garage, parking space, storage room etc.
* Extract from the cadastre
* Valid energy certificate
* Valid certificate of habitability
* Receipts for paid property taxes and waste – the last 4 years
Depending on the type of property, the lawyer may request other information, such as the general meetings of the Community of owners over the last two years, the Community's statutes, a certificate stating that there are no current claims from the Community or the municipality (in case there are discrepancies in square meters between the cadastral and property registry entries), the property's history at the registry, etc.
At this point, you understand the importancy of having all the documents ready to hand... Otherwise this phase can drag on, drain the energy from the project, and frustrate everyone involved.
The next step on the way to a successful deal is the purchase option contract, in Spanish “Contrato de arras”. This contract (usually private) already contains all the essential information, just like the subsequent purchase deed at the notary. This is also why the buyer's lawyer asks for all these documents already at this early stage — not just for personal details and the property register extract. He wants to be sure that he isn't drafting the option agreement for nothing.
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I will dedicate a separate blog post to the option contract, but just a quick note in advance: here are already determined 1. the date of the transfer (usually within the next 2-3 months but it can vary) and 2. which notary will be used (the buyer decides).
Are you curious to see what happens next? Click here for Part 2 of 4: The purchase option contract.
Consulting an expert is crucial to successfully manage the intricacies of these processes. Give me a call; I'll be happy to answer any questions you may have regarding the process. Would you like to contact me? You can find my contact information here on the site.