PROPERTIES OF THE MONTH Page 2
Legal Services Page 7
Friday, May 10, 2013
Buy, Sell Or Part Exchange With Spanish Life Properties
SPANISH LIFE PROPERTIES is a busy estate agency in Quesada and has been successfully selling properties in the Costa Blanca South area for the last three years. It was established to provide a much needed personal service for anyone who is wishing to buy or sell a property in Spain. For clients wanting to find their dream property, Spanish Life Properties listens carefully to what the customer wants and offers them personalised viewing trips, tailored to meet their specific needs so that they find their ideal home. Wanting to sell your property? Then look no further, as their dedicated ´Listings Specialist´ offers a free, no obligation, valuation service, and all the properties that they have are advertised via their shop, website, local media advertisements, property web portals and trade shows, as well as distributed to their extensive list of collaborative agents from all over Europe, so your property will certainly be seen! Spanish Life Properties primary aim is to
Top Tips For Securing Your Power Supply
Here are a few common faults which have been uncovered during a routine electrical survey: 1) Power Surges – Unfortunately these are quite common in Spain and can not only seriously damage electrical equipment and appliances but also result in fire in the worst cases. They are often caused as a result of faulty or overloaded builders supply or bad wiring, but can also be caused by surges from sub-stations and lightning. 2) Dangerous upgrades – Again this is common practice in Spain, as constructors or indeed homeowners attempt to cut corners ensure that clients receive outstanding and lower their costs. service and receive the help and support However, if the supply is not upgraded propthat they need during the purchase and erly, and a circuit breaker with a potential sale process. To assist customers even furthat is higher than necessary is fitted, it can ther, they have an extensive portfolio of lead to badly burnt cables and melted insuservice providers giving clients easy access lation inside Consumer Units. This affects to the best solicitors, conveyors, banking or the function of the circuit breaker, preventing money exchange providers, in fact, any it from tripping out and causing damage to area of help that someone buying or selling the installation and a high risk of fire. a property will need 3) Residual Current Device (RCD) / Trip A unique service offered by Spanish Life Switch not working – You can easily safeProperties is the Part Exchange scheme. guard yourself and your family from the risk This can assist some clients who want to of electric shock, by ensuring that all RCD’s move up the property ladder. Part are functioning correctly. The homeowner Exchange works best in this difficult time, should ideally test these on a monthly basis as even though client´s property maybe and employ a qualified Electrician to carry worth less than a few years ago, the propout a full test every ten years. erty they want to buy is also dramatically 4) Air conditioning units overloading circheaper. cuits – In summer it is extremely tempting to For more information about buying or hammer your A/C units for instant refreshselling a property, or the Part Exchange ment. But if they are not wired into the mains scheme, give them a call today on +34 supply correctly, you will find that your power 966719689 or visit them at their Quesada keeps tripping out. office, behind the SabadellSolbank.
5) Light fittings not wired correctly – It is scary how many light fittings are not earthed, or at times the earth cable has been deliberately cut off, causing a risk of electric shock when carrying out a simple task like changing the bulb. This is due to the cables not being properly protected from the heat of the light source, eventually causing the insulation to melt and exposing a dangerous bare copper live wire. 6) Water and damp leaking into an installation – This is easily avoided by using the correct materials to secure the unit. Ensure that they are weatherproof and durable to avoid a more expensive problem further down the line. 7) Wrong size cable used when fitting extra sockets – Cable must be strong enough to handle all of your appliances. If not they will become burnt or damaged due to the power overload. 8.) Reversed Polarity – It is essential to make sure that the live and the neutral on the main supply cable are connected the correct way round. If you are not sure ask an expert! 9) Bad Earthing - When an installation is not earthed sufficiently it greatly increases the risk of a serious electric shock. 10) Obsolete Socket Outlets – This is a common problem in antiquated properties, where no earth connection is installed. In this instance, should the live cable accidentally come loose and come into contact with the metal case of an appliance, the electricity will travel through your body rather than to earth.
Friday, May 10, 2013
Getting To Grips With The Community Many properties located in Alicante Province are situated within a residential urbanization, which has its own set of observed rules and regulations. So it is important to understand the benefits and obligations to homeowners. Depending on the location and type of property which you chose to buy, you may be obliged to become part of an officially recognised “Comunidad de Propietarios” or Community of Owners, which gives you a voice and equal say in the day to day running of the urbanization. If this is to be the case then your Solicitor or Estate Agent should advise you of your obligations prior to signing at the Notary to avoid any confusion later on. Essentially, the running costs, maintenance and eventual resale value of your property will be greatly affected by how well the Community of Owners cooperate as a team, and on this basis it is beneficial to play an active part on the committee. As a general rule, newly constructed properties will remain the responsibility of the developer until they have reached completion and approval by the relevant Town Hall, or are sold. At this stage, the new owners will usually be invited to a meeting when the developer will officially “hand- over” the responsibility of the general care and maintenance of the entire estate to the newly formed Community of Owners. If you are purchasing an older or resale property you will probably find that a Community of Owners is already in place, although this does not exempt you from becoming involved. One resident must be democratically elected as President, with an opportunity for each homeowner to review the position and elect a new President each year at an Annual General Meeting. Other official roles are allocated using the same process, including VicePresident, Treasurer and Secretary. The primary purpose of the Comunidad de Propietarios is to guarantee that the houses or apartments of the urbanization are all well kept, and communal gardens or swimming pools are also maintained. The system is meant to benefit all concerned, ensuring that they continue to live in the pleasant environment in which they made their investment. Naturally there has to be a legal element involved; specifically several laws and bylaws with regards to the creation, administration and statutes of the Community, to ensure that all owners take their responsibilities seriously. With the British being renowned for their good organiza-
tional skills and attention to detail, combined with the large number of Brits living in the region, it is common to find that they have a significant presence on the Committee- sometimes more so than native Spanish speakers. The shift has meant that certain administrative changes have been required in the running of the communities, mainly due to the fact that the English speakers cannot understand much Spanish! In past years most meetings were conducted in Spanish and accompanied by minutes written in Spanish, although a translator would usually be present. However, this was widely contested as in many cases there were few or no Spaniards present, but plenty of English speaking residents. Therefore, it was legally agreed that a vote may be taken by the community over which language the meetings should be held in, with the majority taking precedence. For British residents who speak little Spanish, it may be easier to settle in an area with a large English- speaking population, where you should also find that much of the information required to get you started is available in English. Many expats welcome the idea of becoming involved in the local Spanish Community, and the opportunity to meet their neighbours, of all nationalities, and get a taste of the various languages and cultures that are alive on the Costas. However, generally speaking most of the Spanish tend to live outside of urbanizations where they will
have an established social network and often family living close by. As a property owner you have the right to be kept informed of any problems which have arisen on the urbanization, as well as any proposed improvements that affect you or your property. Some communities find it beneficial to produce a monthly newsletter conveying these details, particularly where there are many non-resident owners. Whilst some members of the community may be happy to help out with administrative tasks on a voluntary basis, there are usually certain costs involved, such as printing and official translations for legal purposes when required. This means that all owners are obliged to pay an annual community fee “Gastos de Comunidad”, which may be paid in stages or in full and is meant to cover all of the day to day running costs of the urbanization including : • Lighting for public buildings and streets • Cleaning and sweeping of the streets, pavements and stairwells • Maintenance and painting of Building exteriors and communal areas • Lift maintenance • Community personnel such as security guard or caretaker • Security monitor and/or gates/doors • Maintenance of common areas such as roofs, gardens etc… • Legal costs • Official translating costs • Printing • TV Aerials (If community responsibility) • Private water supply (If the Community does not have Municipal Water) The payment of community fees is obligatory and anyone failing to do so will be served an official notification from the community before legal action will be taken. It is important to note that the community fee only covers your obligations within the urbanization itself and you will still need to make a separate payment to the local authority which is similar to UK council tax. In most cases the Comunidad de Propietarios is a very effective system, which will help to protect your investment in the longer term.
Friday, May 10, 2013
Information abou Certificate Legilisa
In The UK when you buy or sell a property, you have a surveyor ! In Spain now you need a European Energy Certificate from a qualified Architect or Technical Engineer specialised in Energy ratings. "Spain is two years behind the rest of Europe in introducing the residential energy certification". It was introduced into Spain by law on 1st January 2013 by Royal Degree.235/2013 The Spanish Government drafted legislation that is going into effect in June 2013 and will force all the properties / houses / commercial properties that are for sale or rent, to hold a certificate of energy efficiency to be produced at the Notary as part of the sale / purchase of the property.
Professional Business Support put the following Questions to our Certified Architect
PBS: What is the certification of energy efficiency? Architect: Energy certification is a measurement that is made to assign properties with an appraisal by assessing the energy efficiency of the property. In general the formula of the certificate is Kg Co2 / m2 year. Exactly what it involves is taking a series of data of the property, to calculate some variables then study the data to get a result as an energy rating. The Data taken includes photos, Building qualities, Insulation, orientation, plan, heating, appliances. This then becomes a rating, as currently incorporated with all new electrical appliances, and that goes from A to G, with qualified properties obtaining an A rating being the most efficient and G the least efficient one. Most properties here on the Costa Blanca would achieve a E, F or G Rating.
PBS: What are the main aspects that make a property obtain a good energy efficiency rating? Architect: First a measurement is made of the property (KgCO2/M2year) through the plans where aspects are observed as to there orientation. It is not the same as a house is south facing against one that is facing north, or having many or few facades to the outside, even if other buildings overshadow it. This does not mean a south facing house is better than a north; a South facing house may have to use more electric to cool it down in summer. The architect also measures the size of the windows and the type of glass that have, the materials of construction of the housing, heating, air conditioning available and an efficient water heater. For example, energy efficiency is quite different with a diesel / oil or electrical installation, which are rather inefficient, than an installation of gas or biomass, which are more efficient. Also taken into consideration is the age of these installations. PBS: Who is responsible for obtaining a certificate for a property? Architect: The Owner of a property is responsible for having a certificate made. PBS: How long is a new energy rating certificate valid for? Architect: The Certificate is valid for 10 years, unless major changes will be made to the property. PBS: What impact will good energy efficiency have? Architect: Having a good energy rating in principal creates lower power / energy consumption. Knowing the energy rating of a home you can tell if you the consumer more or less throughout the year in heating costs or air conditioning. In short, a better rating would mean that the property will be better valued as it is more energy efficient.
If the reforms are made that the architect suggests an annual saving of energy costs would be noticeable. PBS: What difference in consumption would there be between a home with a better or worse energy efficiency rating? Architect: We have studied cases where a G-rated family home, the less efficient, had a monthly consumption of heating of 600 euro a month in winter. After the survey and refurbishment of the property, among which was the installation of a biomass boiler, the house rating changed to a B and a monthly consumption was significantly reduced per month. The energy rating certificate is to inform prospective customers, buyers, on how efficient are these homes. Having transparency means for improved energy efficiency of buildings. PBS: What average cost may be incurred in restoring a home to improve one level in the scale of energy efficiency? Architect: The cost is relative, each case is totally different. But for example, you could make a change of windows in a building with an average of five windows, and the cost would be between 3,000 and 5,000 euros, but also depend greatly on the type of windows that you choose. In any case, this housing reform would have a great improvement in energy efficiency. On the other end of the scale a few energy efficient light bulbs can help a lot. PBS: What does it cost to qualify and certify a home? Architect: For an average property, the price is about 230 euro plus IVA. This price includes the site visit, measurement, plans, photographs, building specifications and valuation of housing and the delivery of the certificate and the energy efficiency label, with a declaration of responsibility from the architect. Also including recommendations to
Friday, May 10, 2013
ut the New Energy tion 2013 in Spain increase the energy efficiency of you property and estimated costs to do so. PBS: What do you an architect think about the rules the government want to introduce to certify the energy efficiency of all homes for sale or for rent? Architect: The law seems very positive, in fact it is already worked in virtually all countries of the European Union, here in Spain we are two years behind the rest. What this legislation will mean is that all prospective tenants or buyers will have a graphic energy efficiency report of the property in which they are interested. Currently, when we buy a house and make a major investment in our life, we have virtually no information about that property and yet when we buy any electronic gadget they come with an instruction book and guarantee. Any initiative involving greater information for buyers or tenants is very positive. The important thing now is that the initiative is carried out. PBS: What type of property is required to make the energy certification under the new rules? Architect: All property that is offered for sale or rent, private and commercial. But there are other private homes, of more than 500 square meters, while not entering the housing market, whether they are publicly accessible spaces (such as offices, stores, hotels, financial institutions) will be required to make the certification energy. PBS: Can a property fail the Energy Certification? Architect: It is not a pass or fail situation. It is merely and informative certificate for the purchaser or tenant of that property. PBS: Do you think it is all right that the legislation ordered by the Government of Spain make it
mandatory for the certification for anyone who wants to rent or sell their home or do you believe it should be the decision of the owners? Architect: Ultimately it is the owner who is providing information on their own property which is for sale or rent, to the advantage of the buyer. What is being promoted is transparency in the real estate market, to attract and inform possible buyers. PBS: What do you think about the positives and negatives of the energy efficiency certification to an owner who wants to rent or sell your home? Architect: Obviously the owner is going to bear paying the initial fee to certify their home. But what this is going to do is encourage some competition between energy efficiencies of various buildings and therefore the rehabilitation of homes. Households with improved energy efficiency will have a better argument to sell property quicker. PBS: Can the energy rating of new home sales benefit the newer properties which are supposedly be constructed more efficient, compared to older homes? Architect: N e w e r homes
Property Management With OP Group
Do you own property in Spain and are looking to achieve the best possible returns from your investment with the least possible effort? Then let OP Group take control… OP Group Spain is one of the Costa Blanca’s leading Property Sales, Rental and Management Companies. A family-run business, it was launched over 7 years ago, and now embraces offices in Algorfa, La Marina and Gran Alacant, with hundreds of properties spanning the coast from Alicante to Campoamor. Directors Steve Austen and Stuart Markham explained that their core business is looking after the client’s investment, and helping them to get the best out of it in accordance with their requirements, at the most competitive prices. They are joined by a friendly, bilingual team who are happy to help clients with all manner of tasks from obtaining Residence Certificates to signing on the Padron. The team visit each property regularly to ensure that everything is safe and secure, and report this back to the owner for their peace of mind. This simple step can save the homeowner money in the long-term, for example, if there is a water leak, electrics have been left on, or if the property has suffered a break-in. The long term rentals market is currently extremely buoyant, as many who moved out of Spain when the crisis hit have began to return, while others are arriving in search of a better life. All letting contracts arranged by OP Group are fully legal, and designed to protect both parties, ensuring that the tenancy runs smoothly. The tenant can contact the office with any concerns, and a maintenance man is on-hand for swift attention to any problems which should arise with the property. In the event of non-payment, they operate a Rental Guarantee Scheme, using an inde-
pendent arbitration company, for quick eviction and prompt legal action. OP Group also extends a comprehensive holiday lettings service, where they will market the property, arrange bookings and organize any cleaning and maintenance required so that everything is in perfect condition when the guests arrive. The team “meet and greet” the clients, either at the airport with a rental car or transport them to their accommodation; or they may collect keys from the office and be shown to the property from there. Plus, to help them make the most of their vacation, OP Group will even book activities such as golf, scuba diving, hot air balloon rides, boat rides and other excursions on their behalf! Meanwhile, for those who are looking to sell, OP Group is a great place to start. With clever marketing initiatives and collaborating Agents out in the field, they can offer maximum exposure for your property, and thus a quick sale at the right price! So to start getting more out of your property give them a call today on 966 729 653. Alternatively, you may email enquiries to firstname.lastname@example.org.
that are built under the current technical code since 2007, are also required to have this energy certification but with the new work codes will have a better rating. Probably the oldest buildings have a worse efficiency, but it is also quite possible that during the life of these buildings have had renovations. The rating will be shown that these properties have been reformed in certain aspects to have better energy efficiency. PBS: Do you think the Spanish homes have a better or worse energy efficiency over the European housing? Architect: They are less efficient. In fact in England, where these rules came into force a few years ago, it was found that the properties had increased energy efficiency reforms and therefore have gained better energy ratings. PBS: What are the most common deficiencies of Spanish homes in terms of energy efficiency? Architect: The issues that are deficient in Spanish properties are heating; diesel, for example is very inefficient. Also insulation issues in the construction of housing and the type of windows are the worst offenders. PBS: Will a Notary let a house sale go ahead without an energy certificate? Architect: As from the 1st of June 2013 no property can be signed at the notary without Energy Certification provided by a qualified Certified Technical Engineer or Architect. PBS: Thank you for the Explanation, How do clients get in contact with you? Architect: All clients can contact yourselves Professional Business Support on 966 923 963 or visit your offices. They can leave their details with you, I will then arrange to visit their property.
Friday, May 10, 2013
Top Ten Property Buying Blunders It is all too easy to get carried away with the thoughts of endless sunny days and the colourful culture that comes with living in Spain. But when investing in something as valuable as a future home you need to go in with a clear head. If you are seriously considering investing in a Spanish property you may already have heard of the “Association of International Property professionals” (AIPP), a UK based association which works to protect the interests of buyers of overseas property. They have a wealth of knowledge of the protocol that is involved in overseas investment, and are also familiar with some of the most common blunders that buyers continue to make. AIPP argue that there are a plethora of magazines and websites which offer advice on what to do when buying property abroad, but there are very few which advise you of what not to do. Therefore, in this week’s Property Plus we have included a list of the top ten things to avoid when buying your next home. 1) Entrusting in a Solicitor who works for, or closely with the developer or agent- Great big NO NO! It is vital to use a Solicitor when purchasing property as they know the in’s and out’s of the Spanish system, but make sure that they are entirely independent, so that there would never be a conflict of interests should you have an legal problems with the developer further down the line. 2) Confusing a Solicitor with a Notary- This is a common mistake and easy to confuse, as Notaries do not form part of the conveyancing process in the UK. However, in most popular overseas destinations including Spain, it is the Notary who must by law rubber-stamp all property transactions. If not they are not legally binding and will not stand up in court. 3) Signing a contract without seeking independent legal advice- It can be tempting to side step this process, especially if you are in the hands of a very good salesman! However, it is vital to appoint a Solicitor no matter how clued up the agent might appear. Remember that they want you to buy, and may put pressure on you to sign something which may not be quite as it seems if you get a professional in to read the small print! It is very easy to find an English speak-
ing Solicitor in Spain, who will usually be available by email/fax to check a contract for a small fee. 4) Counting on a verbal agreement- Even if you are buying or renting off someone who you know, you must always ensure that every last detail that you have agreed is put in writing, from the payment of utility bills to the fixtures and fittings. Ensure that your contract is watertight and that every page is signed so that no unauthorized changes can be made later on. 5) Overlooking additional buying costs- In some countries, including Spain, the addition of legal fees and property taxes can increase your purchase price by as much as 15%, which can come as real shock if you haven’t budgeted for it. Your
agent should be able to advise of the entire cost to you, and if you are not convinced then ask a Financial Advisor or Solicitor to give you a break down. 6) Dismissing the consequences of fluctuating exchange rates- If you are making your investment in sterling, remember that your buying power will vary according to the strength of the pound against the euro at the time of signing at the Notary. Naturally if the value of the pound sees a dip the amount of capital which you propose to put down against the property will have to increase. 7) Overstretching your finances- It is very easy to convince yourself that you can afford something which you really want, even though the reality is that you are going to struggle in the long term. Plus, if planning to let the property, it is also very risky to rely entirely on rental income to cover your monthly mortgage repayments, as you cannot guarantee that you will always have a tenant, or indeed, that they will pay! 8) Ignoring your taxation obligations- You should get advice regarding your tax obligations prior to committing to a purchase, as this will help you to budget for the future. Most importantly, do not assume that the system in Spain is the same as in the UK, as it has its own set of regulations, particularly when it comes to property and inheritance issues. 9) Under-declaring the purchase price on the Escritura- this was common practice several years ago, and some companies will still encourage you to do it as the cheapest option, but don’t be tempted. It is considered as fraud under Spanish law and could leave you behind bars rather than in your dream home. 10) Letting your heart rule your head- the perfect point to finish on. The vast majority of property purchases in Spain run smoothly, but the dream could soon turn into a nightmare if you dive in at the deep end without doing your homework. So to re-cap…. entrust a respectable Estate Agent, appoint an independent Solicitor, ensure that you have a fully legal fool-proof contract and glean as much information as you can about your property, rights and obligations before you buy.
Friday, May 10, 2013
Spain Sees a 30% Fall in the Cost of Housing Here and now is still the ideal time to invest in property in Spain, as housing prices continue to plummet. The average value of a Spanish property has dropped by an incredible 30% since prices hit their peak during the first quarter of 2008. This was largely due to the drastic decreases witnessed during 2010 (-6.6%) and 2011 (-10.5%), with the trend continuing into last year when prices fell by over 13%. According to the 2012 statistical real estate registry yearbook of the College of Property Registrars, house purchases fell by an estimated 10.6% last year, with a drop of 10.5% in new houses and 10.7% in resales, amounting to a total 330,750 transactions. They believe that “the new tax changes – the end of tax deductions for home purchases and the increase in VAT from January 2013 – have not changed the fundamental trend of past years”, adding that property transactions were distributed almost equally between new housing (49.9%) and resales (50.08%).
Mortgages According to the latest figures released by the National Statistics Institute, the number of new mortgages on homes stood at 24,197 in February this year, signifying a drop of 7.5% when compared with the same month during 2012. During last year, the average mortgage value measured 105,421 euros, which equates to 9.7% less than in 2011, and is on a par with values of 2003- clearly as a result of the fall in house prices. However, the average interest rate on residential mortgage loans stood at 4.08%, increasing over a two year period from 3.37% in 2010 and 3.72% in 2011, in spite of a series of major reductions in the Euribor. Meanwhile the borrowed capital reduced by 9.2% yearon-year, to 2,507.4 million euros.
During January and February of this year, mortgages on homes witnessed a drop of 4.9%, compared with the drastic fall of 9.9% experienced in February 2012. The statistics agency’s records state that of mortgages borrowed during February, a total of 37,656 were constituted on rural and urban properties, equating to a decrease of 13.7% compared to February 2012. Mortgages which constituted a variable interest rate have b e c o m e favourable to those with a fixed rate, representing 92.3% of the total amount; with the Euribor being the reference interest rate most commonly used in constituting mortgages with a variable interest rate, specifically in 87.1% of new contracts. According to Spanish economy portal “El Economista”, the regions which have registered the greatest number of new
mortgages since the start of the year include Andalusia (4,545), Madrid (3,900) and Catalonia (3,420). Further to this, the regions with the highest annual growth rate included La Rioja (+42.8%) and the Canary Islands (+37.5%), while the most significant downturns were witnessed in the Balearic Islands (-30.5%) and Castilla-La Mancha (30.1%). Madrid was found to be the region where buyers would provide the largest sum of capital towards their purchase, summing 550.7 million euros, followed by Andalucia (404 million euros) and Catalonia (396.3 million euros). A spokesperson for the College of Registrars stressed that “Consequently we are seeing a strong reduction in the housing investment component of the Spanish real estate market”.
Movement Of the total number of properties sold during 2012, 68.24% had belonged to the same owner for more than five years, compared to 64.74% in 2011 and 49.74% in 2009. Comparatively, the number of people who had lived in the same property for less than two years and were already looking to sell up was far less during 2012, measuring only 13.64%, compared to 22.5% in 2007.
Foreign Investment El Economista reports that foreign investors accounted for 8.12% of the house purchases recorded in Spain in 2012, which equates to 6% more than in 2011 and a record high since the property boom of 2007, when the figure stood at 8.2%. Figures show that foreign buyers still prefer to settle on the coast, with the Valencia Region in third position in the popularity stakes at 18.01%, trailing only the Balearic Islands (24.95%) and the Canary I s l a n d s ( 2 2 . 11 % ) . O t h e r popular
coastal regions include Murcia (11.24%), Catalonia (9.34%) and Andalucia (8.86%). In terms of nationality, these purchases were divided between British (16.6% of the total), French (9.9%), Russian (9.6%), German (7.9%), Belgian (6.5%), Norwegian (5.7%), Italian (4.9%) and S w e d i s h (4.6%). Dutch people were the largest investors in new property, with 58.6% of their total purchases relating to this type of property, with Russians (56.8%), Swedish (54.6%), Belgians (52.9%), Norwegian (52.8%) and British investors (52.1%) also opting for new developments. This was in contrast to resale properties where Algerian buyers made the greatest impact (70.4%), followed by Moroccans (64.8%) and Chinese (64.5%).
Friday, May 10, 2013