Things to know about buying property in Majorca What you should consider if you want to buy real estate in Majorca! The purchase contract for a property does not need to be in writing in Spain and does not have to be notarized. However, notarial certification is required for the entry of your property in the land register. However, since only the entry in the land register guarantees the buyer a secure legal position, the notarial conveyance and certification of the deed of purchase is essential for you as the new owner of the property on Majorca. The notarial drafting and certification of the purchase contract can theoretically take place immediately. After all documents and the necessary forms have been attached, nothing stands in the way of this appointment. However, you should have clarified the following points in advance. If you as a buyer have applied for your tax number, your property is free of old costs such as electricity, water, etc., e.g. the financing is available and you must have a document about the property tax paid depending on the workload of the notary in Palma de Majorca. In order to secure your property, however, you should conclude a contract that secures the property for you. We are happy to support you with our own specialists for real estate in Majorca. The private purchase contract or also called Contrato privado de Compraventa With the signature of a private purchase contract, the property is sold to you. Here, too, you should have checked all documents beforehand so that there are no nasty surprises afterwards at a notary appointment. A deposit is usually agreed for this type of contract. The reservation contract or also called Contrato de Reserva If you, as a buyer, express a real interest in buying a property in Majorca, but e.g. the financing of the purchase price is not yet secured or your capital is not yet freely available. Then you can choose this type of contract by paying a deposit on the purchase price. The seller undertakes to reserve this property for a fixed period of time. You should choose to have the reservation amount offset against the purchase price upon purchase. If the purchase does not go through, you usually have to pay this amount to the seller. The option contract or also called Contrato de Opción de Compra is a binding declaration of intent by both parties against payment of a certain sum granted the right to purchase the property at a certain price within a specified period. If the purchase does not come to fruition within the period on the part of the buyer, the sum is lost for him. If the reasons exist with the seller, he has to pay double the amount to the buyer as compensation. The notarial conveyance and certification of the deed of purchase is a prerequisite for the entry of the new owner of a property in Majorca in the land register. The notary is obliged to notify the land registry of this within 24 hours of drawing the deed of purchase. This means that a reservation is made in the land register that blocks any further entry for a period of 10 days. As the buyer, you should submit the deed to the land registry within this period, but be careful that this does not happen automatically. Within 30 days of the notarial certification of the deed of purchase, the buyer has to pay the property transfer tax or ITP to the responsible tax office. The new owner can only be entered in the land register after payment has been made. The real estate transfer tax or Impuesto sobre Transmisiones Patrimoniales Property transfer tax is due for all property sales that are not subject to VAT. This is staggered on Majorca according to the amount of the respective purchase price and is up to 10%. Value added tax is due when a new property is sold for the first time, when building land and commercial property are sold, or when a legal person sells it. In Spain, property owners pay property tax. The property tax is based on the cadastral value of the property and differs from municipality to municipality. Property owners in Spain are generally subject to income tax returns. If a property is not the primary residence, income tax also applies to owner-occupied properties. This varies from region to region. Therefore, you should inform yourself about it in advance. Guetig Group’s own specialists accompany you from the search for an extraordinary property to notarial certification. Send us your wishes, we will contact you as soon as possible. To the contact page
Contract types when buying a property in Majorca are:
The most important thing for you as the owner, called the notarial purchase contract or Escritura Pública
Different taxes when buying property in Majorca
The VAT or Impuesto sobre el Valor Añadido, IVA
The property tax or Impuesto sobre Bienes Inmuebles, called IBI
The income tax or impuesto sobre la Renta de las Personas Físicas, called IRPF
The wealth tax or impuesto sobre el patrimonio
We assume no liability for the correctness as legal changes are possible. We are happy to support you in all matters relating to the purchase of a property in Majorca. Through our network of notaries, lawyers and authorities, we are happy to support you in preparing to buy your dream property in Majorca.
What to look for when buying a property in Majorca
