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BUYING PROCEDURE AND SERVICES

You have found your ideal home in Galicia and after careful consideration you have decided to buy it. The buying procedure consists of three steps.

Step 1: Contrato de Arras (Contract)

A private contract signed between the buyer and the seller. A deposit (normally 10%) is required. When the contract is signed, it is agreed that when the buyer pulls out or cannot provide the remainder of the buying price at the end date of the contract, he or she will lose the deposit. If the owner of the property is in default of the terms stipulated in the contract, he or she will have to pay back double of the amount of the deposit to the buyer.

Step 2: NIE (Spanish tax identity number)

You are required to have a tax identity number or Numero Identificacion Extranjero (NIE) and a Spanish bank account before the transfer of the deed.

Step 3: At the notary

In the notary office you and the seller sign the deed (escritura de compraventa), pay the outstanding money and obtain the keys. You receive a copy of the signed escritura de compraventa, proofing you are the legal owner of the property.

The notary sends your escritura de compraventa to the property registry office (Registro de la Propiedad) to be registered and converted into a public document or Escritura Publica. You will receive the original, registered deed roughly two months later.

If you are unable, to be in Spain for this crucial meeting, then you can make a power of attorney (poder) at an earlier date and give this power to your lawyer or other representative.

Services of Galiciavista

Galiciavista is at your side with every step. We assist buyers with obtaining a NIE number, opening a bank account and with the connections of the electricity and telephone lines, house insurance etc. If you so desire, we can recommend English speaking lawyers, architects and builders. Our service does not stop after the notary, if you need assistance, we provide after sales services. Contact us for more information.

For those who want to use a currency exchange company we can recommend reading the free Moving to Spain Guide. This guide also includes other helpful information on taxes and finance, the Spanish healthcare service and a handy emigration checklist.

Guest article

 

Galicia Property More Affordable Than in Early 2019, as Euro Weakens

13.11.2019 by Peter Lavelle at E-Money Institution Foreign Currency Direct

Do you intend to buy real estate in Galicia this year or next with Galicia Vista? If so, you might have your eye on a big, historic property with a coat of arms in Villalba, with six bedrooms, for €250,000. Alternatively, you may like the look of a ready-to-move-into, five bedroom country house near Lugo, for €135,000.

 Whichever the property you purchase in Galicia, you’re sure to enjoy this beautiful part of the world, with its ancient Celtic culture and traditions, stunning landscape, friendly people, and mix of local and Castilian cuisine. There’s lots to discover in Galicia, whether you’re buying a holiday home, or relocating to Spain’s North-Western corner.

 Galicia Vista’s International Clients May Have to Buy Euros First

That said, before you grasp the front door keys to your Galician property, you may first have to transfer money to Spain, to finalise the purchase and begin making your mortgage payments.

In this case, if you’re a Brit or an American exchanging currencies into euros, to buy a “casa gallega” (Galician home), it may benefit you to know that both the pound and US dollar have risen versus the Eurozone’s common currency, so far this year.

In turn, this could increase your budget in euros, thereby making Galician real estate more affordable for you, compared to if you’d transferred money to Spain at the beginning of 2019, or during these last few months.

British Pound and US Dollar Strengthen Versus Euro So Far in 2019

In particular, the pound to euro interbank exchange rate stands at 1.1683 in mid-November, up from 1.1087 on January 1st 2019. That’s an increase of close to six cents, or of 5.37%.

Similarly, the US dollar to euro interbank exchange rate has gained in value by over 3.5 cents since the start of this year, or by 4.27%, up from 0.8704 to 0.9174 in early November.

These are notable increases in the interbank exchange rate, especially because, when you exchange a large amount of currency, for example to buy a Galician property, they can increase your euro total more than if you were buying a smaller quantity of euros, for example to go on a Spanish holiday.

Euro Loses Value This Year, as Eurozone Economy Slower Than UK or USA

The euro has weakened versus the pound and US dollar so far in 2019, In part because the Eurozone’s economy is growing more slowly than the UK’s or America’s. For example, Eurozone GDP (Gross Domestic Product) expanded by just 0.2% in Q3, between July and September.

By comparison, the UK’s economy expanded by 0.3% over the same three month period, while the USA grew by 0.425%. So we can see that two of the Eurozone’s major global counterparts are expanding more rapidly.

In turn, this encourages the world’s investors to buy British sterling and the so-called greenback, while selling the euro, thereby reducing its value.

Euro Exchange Rate Might Be Affected in 2020, by Eurozone’s Low Interest Rates

Looking to the end of 2019 and into 2020, a large number of factors may affect the euro interbank exchange rate. One significant factor is the Eurozone’s interest rates, which currently stand at 0.0%, below both the UK’s 0.75% and the USA’s 1.5%-1.75%.

In part, this is because the European Central Bank has reduced borrowing costs, to make it cheaper to buy a Eurozone mortgage, or for businesses to invest. This tends to decrease the attractiveness of the euro for the world’s money managers.

However, it may simultaneously make your Galician property mortgage repayments more affordable, which could be another advantage to keep in mind!

Please note that the exchange rates within this article are interbank rates and are for indicative purposes only, and are not trading levels which E-Money Institution FCD offer. For live trading levels contact one of our currency brokers on +44 (0) 1494 725353.

 This article does not constitute advice to any person on any matter and it is not intended as a recommendation to trade. FCD and Galiciavista Inmo make every reasonable effort to ensure that this information is accurate and complete but assumes no responsibility for and gives no warranty with regard to any loss arising from actions taken as a result of acting on this information.