Buying a home in Spain

If you want guaranteed sunshine, miles of glorious sandy beaches, excellent food, an abundant choice of entertainment, and a wide choice of homes at affordable prices, then you will find Spain hard to beat. Although the vast majority of holiday makers (and residents) come to Spain to recline on a beach, there’s much more to the country than the costas and its islands.

Spain has Variety

Spain offers infinite variety with something for everyone, including magnificent beaches for sun worshippers and spectacular unspoiled countryside for magnificent vistas and peaceful strolling. There are also an abundance of mountains and seas for sports fans and a vibrant night-life for the jet set. For those who are comfortable living in cities, there are bustling sophisticated metropolises. For those with gourmet tastes, there are superb wines and fabulous cuisine. There is a wealth of art, culture and serious music for art lovers and numerous festivals and fiestas for inveterate party-goers. And, there is tranquillity for the stressed.

David Hampshire is the author or numerous books on living, working and investing overseas. His website features his highly-acclaimed, best-selling series of Survival Handbooks - C L I C K H E R E

This article is derived from David Hamshire's book, Living and Working in Spain. David's books cover dozens of countries. Visit his website to see the selection.

S U R V I V A L B O O K S

Not for nothing do the Spanish claim to have “Everything Under The Sun!” When buying a home in Spain you aren’t simply buying a home but a lifestyle, and as a location for a holiday, retirement or permanent home, Spain has few equals, particularly if you’re seeking year-round sunshine.

Why Buy in Spain

There are many excellent reasons for buying a home in Spain, although it’s important not to be under any illusions about what you can expect from a home there. To get a firm handle on what you expect, ask yourself exactly why you want to buy a home in Spain. For example, are you seeking a holiday or a retirement home.

The Costa Blanca and Costa del Sol have the highest percentage of retired persons in the world, when both Spaniards and foreigners are included. If you’re seeking a second home, will it be mainly used for long weekends or for lengthier stays? Do you plan to rent all or a portion of it to offset mortgage and operations costs? If so, how important is the property income? Are you primarily looking for a sound investment? Do you plan to work or start a business in Spain? These are questions that need answers no matter where you purchase, but especially in Spain because of the variety of choices Spain has to offer.

Often buyers have a variety of reasons for buying a home in Spain. For example, many people buy a holiday home with an idea of living there permanently or semi-permanently after they retire. If this is the case, there are many more factors to take into account than if you were simply buying a holiday home that you will occupy for just a few weeks a year. If, on the other hand, you plan to work or start a business in Spain, you will be faced with a whole different set of criteria. You may be thinking of buying a home in Spain and commuting to another European country to work. Many people are doing just that because Spain has a lot to offer.

Don’t Stretch Your Financial Resources

Can you really afford to buy a home in Spain? What of the future? Is your income secure and protected against inflation and currency fluctuations? In the ’80s, many foreigners purchased holiday homes in Spain by taking out second mortgages on their family homes abroad and stretching their financial resources to the limits.

Not surprisingly, when the recession struck in the early ’90s many people had their homes repossessed or were forced to sell at a huge loss when they were unable to maintain the mortgage payments. Buying a home abroad can be a good, long-term investment, although it’s possible to get your fingers burnt in the occasional volatile property market in many countries, including Spain.

There’s A Stable Property Market In Most Of Spain

Property values in Spain generally increase at an average of less than 5 per cent a year or in line with inflation (with no increase in real terms), although in some fashionable resorts and developments prices rise faster than average, which is usually reflected in much higher purchase prices. For example, prices increased by up to 25 per cent in some parts of the Costa del Sol in the last few years. There’s a stable property market in most of Spain, barring recessions, and this may act as a discouragement to speculators wishing to make a fast buck. This may be particularly important when you consider that capital gains tax can wipe out much of the profit made on the sale of a home, especially a second home. You also need to recover the costs associated with buying a home in Spain when you sell. You shouldn’t expect to make a quick profit when buying property in Spain, but should look upon it as an investment in your family’s future happiness, rather than merely in financial terms.

The Benefits Outweigh Drawbacks

There are both advantages and disadvantages to buying a home in Spain, although for most people the benefits far outweigh any drawbacks. Among the many advantages are guaranteed sunshine and comfortable Mediterranean temperatures. Some areas of Spain, especially the resort areas, are some of the least polluted areas of the world.

There’s good value for your money, and Spain is easy and inexpensive to get to, at least for most western Europeans. There are great rental possibilities and good local tradesmen and services. There are fine foods and wines at reasonable prices and a relatively low cost of living. There’s the slow, relaxed pace of life; the friendliness and warmth of the Spanish people; the dramatic, rugged beauty of Spain on your doorstep; and, last but not least, a superb quality of life.

A Few Disadvantages

Naturally, there are also a few disadvantages, not the least of which are the relatively high purchase costs associated with buying property. There could also be unexpected renovation and restoration costs if you don’t do your homework. Check with local officials to see if there’s a high rate of burglary and housebreaking that are present in some areas. Be prepared for overcrowding in popular tourist areas during the peak summer season and traffic congestion and pollution in many towns and cities. Beware also of a number of admittedly small taxes for non-resident homeowners. The phrase, “In Spain, the rain falls mainly on the plane,” can be all too true when occasional draughts cause severe water shortages in some regions, particularly during the summer. Finally, don’t overlook the expense of getting to and from Spain if you own a holiday home, and you don’t live in a nearby country or a country with good air connections.

Get Familiar with the Area

Unless you know exactly what you’re looking for and where, it’s advisable to rent a property for a period until you’re more familiar with an area. As when making all major financial decisions, it’s never advisable to be too hasty. Many people make expensive (even catastrophic) errors when buying homes in Spain, usually because they do insufficient research and are in too much of a hurry, often setting themselves ridiculous deadlines such as buying a home during a long weekend break or a week’s holiday. Not surprisingly, most people wouldn’t dream of acting so rashly when buying a property in their home country! It isn’t uncommon for buyers to regret their decision after some time and wish they had purchased a different property in a different region.

Do your Research

Before deciding to buy a home in Spain, it’s advisable to do extensive research on buying. Two good resources are, Buying a Home in Spain and Living and Working in Spain, both written by the author of this article and published by Survival Books. It also helps to study specialist property magazines and to visit overseas property exhibitions. Bear in mind that the cost of investing in a few books or magazines is tiny compared to the expense of making a big mistake.

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