How to Retire to Spain, Advice for Viewing Property, Plus More

Welcome to the March edition of the Marena Murray newsletter.

In this month's edition, we share a guide for those who are thinking of retiring to Spain, we discuss some top tips for viewing property like a pro and we offer some assistance for securing an overseas mortgage.

Top Tips For Viewing A Property Like A Pro!

 

When it comes to buying a property overseas, it is important to keep in mind that it could potentially be the home you live in for the rest of your life. With this in mind, it is essential that when you view potential properties you take the time to be thorough and get all the information you can. In terms of a holiday home, many of the parameters are the same, dependent upon location.

To help make sure you don’t miss a thing and make the right choice when you do eventually make an offer, we’ve compiled the following list of tips to view a property like a pro.

Don’t rush
We all feel a bit strange viewing someone else’s home, but as we said earlier, you could be living in this property for decades so don’t rush through this process! It’s vital that you spend close to 30 minutes exploring the property, asking questions and just getting a good sense of how the property feels. If you just wander from room to room, taking a quick look and then moving on, you won’t get a good feel for the property. Taking that little extra time will mean you are well-informed when you come to make a formal offer for the property.

Think about how much space there actually is
When it comes to property, space is one thing you can never have enough of. Whether you’re looking to fit in that Queen-size bed or you need somewhere to store all of the precious knick-knacks that you have collected over the years, space is incredibly valuable. Pay attention to the way the current owner has laid out the furniture, as it will provide you with some insight into how to best make use of the property’s available space. It’s also an excellent opportunity to think about how much room your items take up and whether there is any scope for a little pre-move declutter.

Take a walk through the area
When you’re buying a property you’re not just investing in that building, you’re also investing in the neighbourhood itself. If you’re first-time buyers and looking to build a life in this new home, you have to ask whether the area is suitable for your family’s needs. Are there plenty of shops close by? How do the local schools perform? It’s best to wander around the area for a short while in order to see how it all feels, after all, if you’re going to be here for some time, you need to feel comfortable.

Once you’ve taken a good look, take another and maybe another
As we stated at the beginning, when it comes to buying property it’s best done the right way, but even when you do everything right, it’s always best to check things twice. No matter how thorough you intend to be there is always the possibility that you missed a couple of things the first time around. Most would advise visiting a property 2-3 times and at different times of the day – if possible – to see if you feel the same way each time. Buying a home can be very exciting, so it is worth visiting the property a few times.

Don’t forget that your agent is there to help you! Make sure you ask them questions about the property’s history and the local area, as they will be more than happy to assist you with your decision.

A Guide to Retiring in Spain

 

It is no secret that a high percentage of Spain’s British population are retirees who decided to make a big change in their old age.

Affordable property, low living costs, a beautiful climate, entitlement to healthcare and one of the friendliest ex-pat communities in the world, it’s no wonder so many people are choosing to make the move!

How much does it cost to live in Spain?
As long as you aren’t going overboard, it is cheaper to live in Spain than it is in the UK. Given the fact that most ex-pats rely on their finances which are stored in a UK bank (more on that later) the monthly cost goes up and down based on the exchange rate.

You will also find council tax (IBI in Spain) is far cheaper (usually around a quarter of the amount you pay in the UK). Utilities also cost around the same as the UK. Your electricity bill might experience a slight rise during the summer when you’re using your air conditioning, but that’s only for a few months in the year.

You will also find amenities like public transport, and groceries are cheaper in Spain!

What about my pensions and savings?
As we have already mentioned, many ex-pats will choose to keep their UK bank accounts and have their pension paid into that account. The other option is to open a Spanish bank account and have your pension paid into that account. With both options, the only downside is you have no control over the exchange rate used for the transfer.

Many expats prefer to use the services of a currency transfer specialist. They can transfer the pension from your British account to your Spanish account at a better rate than the usual transfer. Some currency specialists allow you to fix your exchange rate for future transfers meaning you won’t constantly need to check their currency.

Healthcare
British people in receipt of a UK State Pension are entitled to free healthcare in Spain. This is due to the UK and Spain being members of the European Economic Area (EEA), which allows for benefits such as free healthcare.

You will need to apply for an S1 form from the International Pension Centre. Once you have made the move to Spain, you will then need to take the form to your local Instituto Nacional de la Seguridad Social (INSS) so that you can become eligible for registering with a doctor.

It’s also worth noting that once you have the S1 form, you can return to the UK for NHS treatment at any time.

Top Tips For Securing An Overseas Mortgage

 

Are you thinking of buying a property in Spain? One of the main sticking points for many UK buyers is how to find the perfect mortgage for their dream holiday home.

There are no restrictions on foreign buyers in Spain, however, there are some differences when it comes to finding a mortgage and buying property in Spain. Here is what you need to consider before applying for a Spanish mortgage, plus the buying costs.

What types of Spanish mortgages are available?
The good news is Spain’s selection of mortgages is no different than the ones you would find in the UK. In some cases, they also offer mortgages for ex-pats, so make sure you shop around.

The main difference between residential and non-residential loans is the maximum loan-to-value (LTV) which banks will allow. A Spanish resident can usually borrow up to 80% of the property’s assessed value. On the other hand, a non-resident is limited to 60%-70%. This means that if your property is valued at 120,000 euros, then you will still need to find 36,000 euros to pay for the 30% not included in the mortgage.

What to do before applying
Firstly you will need your Número de Identificación de Extranjeros (NIE). It is similar to your national insurance number and you cannot purchase property or arrange a mortgage without an NIE.

If you’re still in the UK and are organised, then you can apply through your local Spanish consulate. If you’re already in the country, then you can visit your local police station and arrange for your number there. Do some research beforehand to ensure you have the relevant documents and funds to pay your fees.

So where do I need to apply to?
Most Spanish banks will offer mortgages to non-residents. You can also secure a mortgage through an international bank such as Barclays or Santander.

We would advise that you start shopping around as early as possible. The official mortgage process can only start after a sales agreement has been reached. It is also advisable to shop for a mortgage whilst looking at property that you are especially interested in buying. This is because certain mortgages might limit the type of property you can buy. If you already have an agreement in place that doesn’t suit the home you have in mind, you could be left out of pocket.

Before you can apply for your mortgage, you will need to be able to provide the following:

• NIE number
• Proof of employment or income
• A pre-agreement with the seller
• Proof that the property tax is paid to date
• Details of your current debts and mortgages
• Copies of all your existing property deeds (in Spain and elsewhere)
• Records of your current assets
• Any prenuptial agreements (if applicable).

Once you have submitted everything to the bank and the underwriters have processed everything, the bank will make you an offer. We would advise you haggle with them for a better deal, or take the quote to a competitor.