Things to know about buying a property in Mallorca
You have decided to buy a property on Mallorca and have perhaps already found your dream home?
There are a few things to consider when buying a property. We have compiled the most important points for you below.
What do I need?
The most important thing is the NIE number (Número de Identidad de Extrenjeros). This is the identification or tax number for non-residents in Spain and therefore also in Mallorca. You need this NIE number to purchase a property. So if you are planning to buy a house or flat in Mallorca in the near future, you should apply for the NIE number now.
The easiest, cheapest and quickest way to do this is usually via the Spanish embassy or consulate in your home country.
Alternatively, you can also apply for the NIE number via a so-called "Gestoria" in Spain, but this is usually associated with higher costs and may also take longer. It is also important that everyone who is to be registered in the land register can show this NIE number. You will also need the NIE number for almost all other official procedures on the island, such as registering with the electricity supplier, a telephone/internet connection, a purchase on account and other matters.
What costs will I incur?
The costs depend on what kind of property you are buying, i.e. is it a new build (whether a house or flat), a second-hand property or a plot of land.
1. you would like to buy a used property
In this case, you generally have to reckon with around 10 - 14 % additional costs from the purchase price. These consist of 8-10% land transfer tax, depending on the purchase price of the property, and a further 3-4% for notary fees. If you cannot or do not wish to be present at the notary appointment and commission a notary with the notarisation, the notary usually charges 1% of the purchase price for this service. The real estate transfer tax must be paid to the competent authority within 30 days after the notary appointment or notarisation.
2. you would like to purchase a plot of land or a new property
You would like to purchase a new property (first occupancy) or a plot of land?
Here it depends on whether you are buying the land or property from a private individual or from a company. If you buy from a private individual, 21% IVA (Spanish VAT) and 1.5% stamp duty will be added to the purchase price. If you are buying from a company, the IVA is 10% and the stamp duty is also 1.5%. The IVA is payable at the notary's appointment/notarisation, the stamp duty is payable within 4 weeks after the notary's appointment. A further 3% of the purchase price is payable for the notary and the entry in the register. There is no land transfer tax in this case.
Who pays the estate agents fee?
The brokerage fee is paid by the seller in Mallorca.
What is the general procedure for a purchase?
If you have decided to purchase a property and your financing is also secured, an option contract is drawn up. This secures the desired property for you by means of a down payment of 10% of the agreed purchase price. This down payment is usually deposited in an escrow account with a notary. The notary will also charge corresponding fees for this. If both parties agree, the deposit can be transferred to the broker's account.
As a rule, a notary appointment is agreed 8 weeks after the issue of the option contract. This period can also be extended by mutual agreement of the buyer and seller. If you have detailed questions about the option contract, please do not hesitate to contact us.
If all the necessary documents from both sides are available, the notary appointment can take place as agreed and you will then be the happy owner of your property in Mallorca.