Considering a Spanish property purchase post Brexit? Costa Blanca or the Canaries?
After the result of the EU referendum, all our clients who had committed to purchase their Spanish property before the referendum have continued and those looking, are still looking albeit with a reduced budget due to the lower exchange rate.
As far as Spain is concerned, with its great access from UK airports, year round sun, fabulous beaches, scenery, culture and cuisine, it remains a top destination for British buyers and the referendum result does not change that!
Property prices across Spain are still competitive and it is a buyers market. Do not be afraid of offering below the asking price to offset the lower exchange rate. You can always increase the offer if it is rejected! Use an established estate agent and independent English speaking lawyer, for a smooth purchase.
Calculate your budget including the purchase price, taxes and costs. Depending on the region you buy in, property transfer tax varies. For example in Costa Blanca it is 10% on second hand properties whereas in the Canaries it is 6.5%. New properties are also subject to stamp duty up to 1.5%. Ask your agent or lawyer to breakdown the total purchase costs for you.
Use an established currency company as you can save up to 5% on transfers of sterling to euro. Put in place an exchange rate watch if you are buying euros over a period of time.
If you are buying to rent, in the Canaries it is important that the property has a touristic licence. In the Costa Blanca area ask the agent if the property could be registered for rentals.
As and when the UK does leave the EU, we expect that Spanish property owners who spend less than 183 days in Spain will pay slightly more annual non residents income tax, not enough to put you off buying! Buyers moving to Spain permanently will be more interested in finding out if they can access national healthcare. It is expected that an agreement will be reached between the EU & the UK on this subject, especially as there are more Europeans living in the UK than Brits in Europe.
Post Brexit, life continues as normal in Spain. The sun is still shining and this is a fabulous place to live, bring up a family and grow old! Spaniards will continue to welcome the Brits as they have always done, especially as more Brits than any other nationality visited last year and this is unlikely to change soon!
Alex lives on the Costa del Sol with his wife and two children.
