Buying a property in Spain is an interesting investment alternative for Argentines with savings or property in Argentina. It is not only possible to obtain a safe profitability if it is destined to rent. It also avoids the risk of devaluation and inflation in Argentina. Let's see the advantages of buying a property in Spain:
1) Attractive prices
Properties are still expensive in Argentina at dollar value. For the price of an apartment in Buenos Aires it is possible to buy in Barcelona or Madrid. In other large cities such as Bilbao, Valencia or La Coruña prices are lower. And in cities of medium size and high quality of life such as Alicante, Vigo, Vitoria, Tarragona, Gijón the values are very interesting.
2) Almost given away in some towns
If you work online you can settle in one of the many Spanish towns where there are too many houses, too few people and no work. There are villages in Spain with a very good quality of life with homes for sale for 40,000 US$. And less also if you are willing to make arrangements. We recommend you to do your own search in Idealista, Fotocasa, Habitaclia and Pisos.com.
3) Little bureaucracy
The process of buying a home as a foreigner is simple. In fact, it is practically the same as for Spaniards. More information in this post of our blog: Everything you have to do to buy a property in Spain.
4) Safe from corralitos, devaluations and inflation
When buying a property in Spain your capital is protected from devaluations, inflation and other Argentine risks. Properties in Argentina have been priced high in dollars for years, but nothing guarantees that the situation will be sustained over time. An significant devaluation of the peso may result in a loss of real estate value in dollars.
5) Interesting and safe profitability
If the purchase is for investment purposes, the profitability is interesting and safe. According to the statistics of the sector, it fluctuates between 3.5% and 7% per year by city and type of housing.
6) No commission
The vast majority of Spanish real estate agencies do not charge commission to the buyer of a property. The commission is usually 3% of the purchase price and is paid by the seller. Tecnosa is the only major real estate franchise that charges the seller.
Fear of distance
In view of these advantages, why do so many Argentines keep all their assets in Argentina, despite the risks involved? First of all, the lack of knowledge of the benefits of investing in the Spanish market. Then, the doubts about how to do it, the fear of being swindled or losing control over the property.
The process of buying a home in Spain is very transparent, and the the chances of being swindled are nil if the correct steps are followed. We explain it in our post Everything you need to do to buy a property in Spain from Argentina. The purchase is made effective at a notary's office chosen by the buyer. Payment is made in full through the banking system, by means of a check that is delivered at the time of signing. The check is made out by the buyer's bank, in the seller's name. It is a guarantee of collection, since the bank certifies that the money is available and frozen in the buyer's account.
Choosing the right team
As for how to control the purchase from a distance, the key is to choose the right person or team. This person or team will be in charge of looking for the property in Spain, checking the documentation, the state of the building, negotiating the price and making all the previous arrangements with the notary's office. We recommend traveling to Spain for the signing of the deed. Otherwise, a power of attorney to a person of extreme confidence will be necessary.
Having a rented property in Spain while living in Argentina is very easy. In Spain there are numerous real estate agencies and administradoras de fincas (companies dedicated only to manage properties) with solid track record and proven reliability. For practical purposes, for those who own a property in the center of Madrid, it makes no difference whether you live in Toledo, in Buenos Aires or in the Patagonian mountain range. The rental contract is signed online and the rent is collected by bank account.
How to pay
Transferring funds from Argentina directly to the seller is very complex. Most likely, the banking system will put obstacles in the way. The solution is that the buyer open a mirror account in Spain. This is the name given to two bank accounts of the same holder in different countries. This way, you can send money from your bank account in Argentina to the one in Spain. Then the payment is made from your Spanish account. In this post explains how to open a bank account in Spain.
What taxes are payable
If the property is new, a VAT of 10% of the sale price is payable. If it is used, the following must be paid the Transfer Tax (ITP), which varies in each Autonomous Community. The fluctuation is significant, ranging from 11% of the purchase price in Catalonia to 4% in the Basque Country. In addition to the ITP, when buying a property, it is necessary to add between 1 and 2.5% more - depending on the Autonomous Community - for notary, stamping and other fees.
Rents do not pay VATbut the income obtained is taxed. For non-residents the tax is 24% per year. But not on the total rent but on what exceeds the non-taxable minimum..
Each municipality collects the Real Estate Tax (IBI), which is paid quarterly. But it is not expensive. For example, an 80m2 apartment in Barcelona valued at 300.000€ will pay about 500€ per year.
Residents in Spain do not pay personal property taxes for their real estate properties. But non-residents who keep the property unoccupied must pay between 1.1 and 2% of the cadastral value per year, depending on the municipality in which the property is located.
Management and advisory services
Whether it is because you want to protect your assets while obtaining a secure income or because you are attracted by the idea of moving to Spain, buying a property in Spain is a very interesting option. MBT Abogados offers our clients in Argentina a comprehensive service for the purchase of a property in Barcelona and the surrounding area. It includes:
- Housing selection.
- Check documentation and building condition.
- Price negotiation.
- Preparation of documentation for the notary's office.
- Accompaniment at the time of signing.
- If it will be rented, advice on the choice of the property manager.
- Tax advice regarding taxation in Spain and Argentina.
- Advice on opening a bank account in Spain and how to bring the money from Argentina.
- Preparation of powers of attorney if necessary.
- Advice and assistance in obtaining a mortgage in Spain.
If you feel you need assistance with the purchase or sale of a property, don't hesitate to contact us by email or WhatsApp. We are a law firm in Barcelona, specialized in assisting argentines. We also offer other services related to real estate, such as assistance in obtaining a mortgage, advice on the purchase of a property in Spain from Argentina, management of residence visa for real estate investment. Here you can find more information about these services.
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