Mallorca Real Estate Guide

Buying property in Mallorca has become very popular. The country has a pleasant, healthy climate and in recent years the local authorities have made great efforts to increase the number foreign tourists and residents. Spain now derives more of its foreign income from tourists than any other country in Europe. There is a very wide selection of standards, from farmhouses (fincas) and plots through to villas, townhouses, apartments and developments. There is no shortage of real estate agents in Majorca and it pays to search out a good company who will care for your requirements. Before you buy a property in Spain you should use our website to look at the different areas then consider visiting your favourites before deciding where to buy. Many people also rent a property in that area first.

Initial Costs
As well as the cost of the property, the buyer will be liable for transfer tax (IVA), which at present is 7% on a second-hand property and 8% on a new one, plus 1/2% stamp duty. The property registration office will charge you a fee to change the new deeds into your name. This is usually around 300€. There will also be notary charges for copies of the 'escritura publica'. The charge is on a scale depending on the contract price. In total you should allow 10% of the purchase price for costs. It is often the case that the buyer also pays the sellers fees. Check this at the point of enquiry and it is often possible to negotiate. Banks may also charge an opening commission for mortgage loans.

Mortgages in Mallorca;

The documents typically required by a bank are:

• Your DNI/NIE
• Your work contract
• Your last 3 paycheck stubs
• Your latest income tax return
• Your pre-agreement with the seller
• Proof that the property tax (IBI) on the house is paid up.
• Other mortgages or loans that you may have
• All property titles, both in Spain and overseas
• Certificate from work authorities (vida laboral), showing your past work history
• Records of your assets (bank/mutual fund statements, etc.)
• Nonresidents: A certificate of nonresidency (form available from the bank)
• If self-employed: Local tax on economic activities (IAE)
• If self-employed: VAT tax you paid for the last trimester and last year

If you get a mortgage, you will become acquainted with an appraiser (tasador). The bank requires an appraiser to ensure that their loan to you is safe. You will need to pay for the appraiser's work, usually between 300-500 euros. Note that the tasador by law is a licensed architect, so even if you don't need a mortgage, but have doubts about the structural integrity of the house, you might want to hire an appraiser.