Should I buy inland or on the coast in Spain?

Should I invest off-plan or buy a resale property?

If you buy off-plan, is there any guarantee that the developer won't disappear or go bankrupt before completion?

What can I get for my money?

Will it be a good investment?

Once I've found a Spanish property I like, how do I go about buying it?

Can I get a mortgage?

How much extra should I budget for on top of the purchase price?

Can I live and work in Spain?

I've read a lot about 'Land Grab' in Spain - how does this affect me?

Is there a major problem with water shortage in Spain? What should I consider when buying my property?

Should I buy inland or on the coast in Spain?

The thought of buying a house in a small Spanish village or set alone on a hillside, surrounded by beautiful countryside, is incredibly appealing, but you need to think about why you are buying it. If it's for a holiday home which you intend to visit to get away from it all, then this kind of Spanish property may be ideal. But if you are planning to spend long periods of time there, perhaps to escape the British winter, or you are planning to retire in Spain, then think about the reality of living in a remote setting where you have to drive to the nearest town for shops, bars and entertainment and where you may feel an outsider if you do not speak good Spanish.

In inland Spain, however, you can find some beautiful properties with far more space and for far lower prices than they would be on the coast. Buying inland also opens up the range of property options, such as fincas, country houses and rural townhouses, often with your own garden or land.

If you choose to buy a house on the coast in Spain, you will probably buy an apartment, unless your budget stretches to something bigger such as a villa or townhouse. Being on the coast means you are likely to be surrounded by everything you need. It's a far more comforting option, too, if you don't speak Spanish. Bear in mind the crowds in summer, though, and the lull in activity throughout winter, when many bars and restaurants close.

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If you buy off-plan, is there any guarantee that the developer won't disappear or go bankrupt before completion?

By buying a new development with wefindaproperty4u.com, we guarantee that you will deal only with developers who have the relevant licenses to build. When signing a private purchase contract - the point at which the buyer hands over the deposit - the developer must produce evidence of a bank guarantee or an insurance policy to protect your investment. If the developer then runs into problems, such as bankruptcy, the buyer's lawyer will ensure that all the money you have paid so far is refunded, plus interest at 6%.

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What can I get for my money?

Costa Blanca offers the biggest range of properties to suit lower budgets with apartments from £60,000. Murcia is cheaper still, though the infrastructure is less developed than on the Costa Blanca. Costa Blanca North has a more mature property market and prices are higher. There are still relatively cheap houses and fincas to be found a short distance inland, as the overwhelming majority of foreign buyers still stick to the coast.

On the Costa Blanca, the average Villa price is €300,000 and you are unlikely to find much for less than €100,000. Cheaper places can be found inland, but if it is near a golf course or the beach be prepared to pay a premium.

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Will it be a good investment?

No one can predict exactly what the property market is likely to do, and recent changes in the Costa Blanca market now favour buyers who want to spend holidays in their properties and hold on to them for a few years rather than investors who want to sell quickly. The market is still rising, however, so anything you buy is likely to go up in value.

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Once I've found a Spanish property I like, how do I go about buying it?

Wefindaproperty4u.com will guide you through the process from the start. First of all, you need to put down a small holding deposit, refundable if subsequent checks on the property or owner throw up anything unannounced. You will need to find yourself a good English-speaking lawyer (wefindaproperty4u.com can make recommendations) and to have researched your mortgage options, if applicable. Then you can agree on the sales price and then pay a 10% deposit. We will draw up a sale and purchase contract. Finally you need to sign the official document which transfers ownership of the title deeds and register the property in the land registry.

With off-plan properties you usually exchange a private purchase contract within 30 days and then hand over your first instalment, usually 15-30% of the purchase price. Our lawyer will advise you when further payments are due. On the day of completion, the balance of the purchase price is paid, and you (or more commonly, your lawyer) will sign the title deeds for the property, and the keys will be handed over. You should then allow 1-2 weeks before you can move in, in which time you can ask your lawyer to arrange for utility contracts with water and electricity companies

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Can I get a mortgage?

You can get either a Euro or Sterling mortgage, though a Euro mortgage is advisable to avoid losing money as a result of exchange rate fluctuations. Halifax and Lloyds TSB have a special service for British customers wanting to take out a mortgage on a Spanish property. Banco De Valencia is a Spanish bank which specialises in expats mortgages and bank accounts.

Spanish banks will usually lend up to 80% of the property value to non-residents, although the Banco de Valencia are now offering 100% mortgages for people 35 and under. Their choice of mortgages are more flexible than that in the UK but it's a relatively simple process to secure a mortgage, provided you have evidence of income, i.e. 3 wage slips and a P60 or if you are self employed certified accounts.

Most mortgage products are repaid on an interest and capital basis, with a maximum length of 40 years. Or up to 75 years of age.

Shop around for deals. Ask for a copy of the mortgage contract and take it to another bank to see if they can improve the offer, as they frequently will.

You now need an NIE (see below) to buy or sell a house in Spain, even if you are a non-resident. Cost is approximately €100 per application.

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How much extra should I budget for on top of the purchase price?

Allow 6-7% of the purchase price to cover costs, unless you need a mortgage as this may add up to 10% on the purchase price.

• IVA (or transfer tax) 7%
  
• Stamp Duty 1%, payable on completion
  
• Notary & Land Registry Fees, approx 2%, payable on completion
  
• Legal Fees €1200-1500
  

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Can I live and work in Spain?

EU citizens can live and work in Spain without needing any visas or work permits.

As soon as you arrive in Spain you will need to apply for a tax ID number (NIE) from your local police station. You can live in Spain for up to six months a year without having to pay taxes there and without being a Spanish resident. Over that period you are officially a Spanish resident for tax purposes.

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I've read a lot about 'Land Grab' in Spain - how does this affect me?

The issue of 'land grab' in the Valencia region has been highly publicised over the last couple of years and it is something anyone who is thinking of buying a home in Spain should be aware of. However, it should not be something that should deter you from buying in and around the Costa Blanca as, with the advice of a good lawyer; you can make sure you are fully informed about the property you want to buy and whether there is any possibility of it falling under the remit of this draconian Spanish law. A new version of this law - the LAU - is waiting to come into force this year.

The 'land grab' law (officially, the LRAU) was introduced in the Valencia region in 1994 as a way of stopping speculators from snapping up huge swathes of rural land with the intention of developing it later. The town hall simply had to say they needed that land for 'public or social benefit' and they had the right to reclaim up to 70% of the land free or pay a tiny percentage of the market value. It was enough to put speculators off. But then some developers in certain areas spotted a loophole in this law and realised they could apply the same force to owners of isolated rural properties, claiming the land was needed to build new roads or water systems.

The law means these individual owners must either pay or hand over part of their land to help subsidise these developments and it makes no concessions for whether owners of the properties are foreign or not. Those who do not live permanently in the property have not been there to receive the allotted 15 days' notice in which they must present their objection. Problems arose in some specific areas including some parts of Javéa and Orihuela when some private developers, in league with planners at the local government, have exploited a loophole in the law where they could demand compulsory purchase for a discounted price or even charge the owner for 'urbanisation'. No properties in an already urbanised area are at risk - which includes almost all apartments, townhouses and most villas. But anyone considering buying any property in the Valencia region is advised to seek proper legal advice from an independent English-speaking lawyer who knows the local area and its laws. This is particularly vital if you are considering buying outside of an urbanised zone on rural land in the Valencia region. The Andalucian Land Law puts similar restrictions on buying rural land in southern Spain. You should be particularly wary if you are planning to buy a plot of land on which to build your home and always consult a good, independent lawyer.

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Is there a major problem with water shortage in Spain? What should I consider when buying my property?

The lack of water in southern Spain is constantly a huge source of anguish, grievance and political debate. Besides telling people to turn off taps, have showers instead of baths and generally be sparing with their water usage, more drastic measures are called for to provide water to regions such as Murcia, Almeria and Andalucia, which suffer major droughts every year.

The need is even more desperate given the vast amount of development taking place in these regions, particularly Murcia - known as the driest place in Europe - which is seeing mass building of upmarket developments packed with swimming pools and golf courses, for which vast supplies of water are required. So the previous Spanish Conservative government, in cahoots with the major construction companies, came up with an ambitious and highly controversial plan to divert 100 billion litres of water each year from the River Ebro - which runs from the Ebro Delta in southern Catalunya northwest to the Cantabrian border - through a 900km-pipeline to the south of Spain, to irrigate land, water golf courses and fill all those swimming pools. However, the new Socialist government, which depends upon the Catalan coalition government, including the Green Party (ICV), for its majority, is opposed to River Ebro scheme. The plan would hav e exorbitantly expensive (about €5 billion) and an environmental nightmare.

So the plan has been shelved and a new plan for the construction of desalination plants along the coast from Barcelona to Almeria is being worked on as a way to provide essential water to the south. Fifteen plants would provide the same amount of water as the pipeline, but quicker and more cheaply. This option is not without its environmental problems though, such as the massive salt discharges which could turn the Med into a new Dead Sea, the huge amounts of energy required to run the desalination plants and the large amounts of carbon dioxide the plants would emit. But desalination plants are the only viable solution so far to a problem which must be resolved soon. New developments here are transforming the region and one thing is certain: they are only going to increase in number.

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