The Joys of Living in Spain

When you live in Spain you can say goodbye to umbrellas and cloudy skies.

Learn more about living in Spain in IL Postcards.

Rental properties are a perfect introduction to living in Spain
If you are considering whether or not you want to live in Spain it is probably a good idea to first make a long-term rental so that you can experience living in Spain without making a full commitment. For long-term rentals, you usually need a deposit the equivalent of one or two month's rent, and letters from an employer or bank showing proof of your ability to pay. If you use an agent, their commission is normally one month's rent. Madrid excepted, rents for a two-bedroom apartment in a city can be $600 to $850 per month, while a three-bedroom house can be around $1,600 per month. But, like along Portugal's Algarve, many rental properties on the Costas serve as holiday lets rather than catering for people seeking a long-term stay. That said, you shouldn't find it too difficult to get a long-term winter let. 

What potential buyers should know

Away from the popular Costas, English isn't as widely spoken as you might expect. Realtors will happily give you listings, but with rock-solid local interest, they can afford to ignore the language skills needed to attract international clients wanting to live in Spain. Further complicating matters, most people in Catalonia use Catalan rather than standard Spanish. Signs don't point to la playa (the beach). Here it's la platja. Milky coffee isn't café con leche, it's café amb llet. And a street isn't a calle-it's a carrer. The same applies to the Basque country on Spain's northern Atlantic coast where many people speak Basque.

To get the most out of Spain, you'll probably need to make some changes to your lifestyle. Outside of the big cities, shops close for three-hour afternoon siestas, and restaurants rarely cater for early eaters. In fact, Spaniards don't usually have lunch until 2 p.m. or dinner before 9.30 p.m. Household goods are duty- free if you're moving to Spain to live permanently, but if it's a second residence, non-EU citizens are subject to 12% duty on the value of the goods.

Buying your home
Once a property has been chosen, the first step is to make a verbal offer. You may wish to make this offer conditional to being able to obtain a mortgage. In a typical transaction for resale property, you put down an initial deposit ($3,600 to $7,200) to reserve a property. Ideally, e-mail or fax the reservation contract to your lawyer to check before signing. This initial deposit is refundable if the vendors change their mind, but without a clause like "subject to mortgage approval," you'll lose your deposit if you cancel because you can't get a loan. A lawyer ensures that Spanish legal requirements are met and that the property is bought free of encumbrances, charges, liens, or debt. In Spain, any outstanding debts are transferred with the property-you obviously don't want to inherit someone else's back taxes. You then sign a preliminary contract, the compraventa, and pay a portion of the purchase price, normally 10%. This is a legally binding contract that states the date of completion. At that time, all the parties-or their designated representatives-go to the notario's office to sign the escritura, the deed of sale. At that point you pay the balance of the purchase price along with all fees and taxes. Conveyancing normally takes around eight weeks. As a general rule, you should allow 10% to 11% of the price of a property to cover associated purchase costs. Depending on how much work is involved, legal fees are between 0.5% and 2% of the purchase. Notary fees are fixed by law and normally range from $360 for lower priced properties to $1,450 for higher-priced properties. Land Registry fees are generally about $360. 

Then there's value-added tax (IVA) or transfer tax (ITP). ITP applies to resale properties only; IVA is levied on off-plan properties. Both are currently at 7%. Stamp duty of 1% is payable when purchasing off-plan. Plus Valia is a local municipal tax based on the officially assessed increase in the value of the land since the last time the property changed hands. This tax is normally payable by the vendor, but it may be stipulated that the buyer pays. It can range from a few hundred dollars to as much as several thousand dollars on larger properties with a lot of land.

Cost of living in Spain
Living costs in Spain are fairly low, even in the cities. Leaving aside rent or mortgage payments-and depending on your lifestyle-a couple could easily live on $13,000 to $15,000 and still eat out regularly. Once you know where to go, a meal for two with wine can cost as little as $20. For the best value, choose the lunchtime menu del dia (the menu of the day). Although the food is likely to be more filling than fancy, there's normally a choice of dishes on the three-course lunchtime menu. In most places, the menu del dia usually costs between $7.50 and $10. A local beer and a tapa (a little snack which can be anything from a couple of rings of fried squid to a slice of ham topped with an olive) costs around $1.40. Even dining in classier restaurants isn't overly costly. For a couple, the bill is usually somewhere between $45 and $70-wine included. Obviously grocery bills are hard to estimate, but the typical spend per person is $70 weekly. You can go to the cinema for $5.40 and get a mid-range seat in the shade at Madrid's bullfighting arena for $3.80 ($3.50 for a seat high up in the sun.) 

Learn more about living in Spain in IL Postcards.

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