French buyers are the #2 biggest foreign buyers in Spain. So, what should French people know before buying a property in Spain? Here is a guide to help the French buy in Spain, but also help Spanish real estate agents understand better the French buyers.
4,800 Spanish properties
France is the #2 biggest foreign buyer in Spain. Indeed in 2018, close to 5,000 French people bought a Spanish property. In other terms, French people bought 13 Spanish real estate properties per day.
French buyers acquire 4,800 Spanish properties per year
French buyers are the #2 foreign buyers in Spain, second only to the British buyers
The 10 things to know to buy in Spain as a French
Here is a quick guide to help you, the French buyers, with your real estate acquisition in Spain. What should you know before you buy your dream house in Spain? Is it very different from buying in France?
Property prices in Spain are on their way up!
Spain’s real estate crisis is over
- €2,048 per square meter at the end of 2007
- €1,349 per square meter now (2019) meaning -34% compared to the peak => opportunity for investors who can buy now and sell in 3 to 5 years
- +8,2% in 2018 => good timing to invest as prices are recovering
Paris versus Spain – comparison of real estate prices
- €10,000 per square meter for real estate properties in Paris => x7,4 more expensive in Paris than in Spain
- €200,000 buys 20 square meters of real estate in Paris , and 148 square meters in Spain
Paris = € 10,000 per square meter
Spain = €1,349 per square meter, or 7.4 times cheaper
French buyers’ average loan is €174,000
Although French buyers represented 7,4% of foreign buyers in Spain, they represented 5,3% of the mortgages. On average, French buyers took a loan of €174,000 to buy a Spanish property.
Price per square meter: €1,768
- French pay on average €1,768 per square meter
- Compared to the average (€1,373/m2), the French pay 29% more
French buyers pay on average €1,768/m2 for a Spanish property
What type of Spanish properties do French buyers purchase?
French buy second hand homes mostly (90%), meaning that 10% acquired New Homes. Consequently, we can say that French buyers don’t particularly like new homes (“Obra Nueva”). As a comparison, more Belgian buyers opt for New Homes (33%).
90% of the French people buy second hand homes (“segunda mano”)
What are the fees and taxes to pay?
When buying a Spanish property, you will have to pay between 8% and 15% of the property price in taxes and fees. Let’s take the example if you buy a 2nd hand home as 90% of the French do. In that case you will have to pay, on top of the property price:
- 6% to 10% for the transfer of property rights (“impuesto de transmisiones patrimoniales”)
- 1% to 1,5% for legal documents (“Impuesto sobre Actos Jurídicos Documentados”)
- 300€ to 700€ for notary fees => this will be very surprising for you, French buyers because you are used to paying 7% to 8% in France when buying a property. However in Spain, the notary is simply in charge of the contract of the transaction.
- 1% for a lawyer: only way to avoid bad surprises. A lawyer will make sure no debt is attached to the property and do everything that normally in France a “notaire” (notary) does for the buyer. Indeed in Spain, the notary will NOT do that for you.
- 300€ to 1000€ for property valuation : mandatory in Spain if you take a loan.
8% to 15% of the property price in taxes and fees
Mortgage to buy in Spain
As a French resident, you can either take a mortgage in France or in Spain.
However, Spanish banks will finance only 60% to 70% of the property price. Therefore, buying in Spain is very capital intensive.
For a property for sale at 100,000€ which costs 115,000€ with all taxes and fees included, it means that Spanish banks will provide a loan of maximum 70,000€. So, it means that the French buyer will need to bring 45,000€ as a downpayment.