Buy a house in Mallorca
5 Tips & Tricks for your property purchase on the island
Have you been toying with the idea of buying a house in Mallorca for some time? No wonder! After all, Mallorca is one of the most sought-after travel destinations and also emigrant destinations in the world.
The most beautiful natural beaches, summer feeling almost all year round and good flight connections, yes, these are just some of the positive points that come together in Mallorca. But just buying a house abroad is not always easy either.
But what exactly should you consider when buying a house in Mallorca? Where do you have to be particularly careful? Apart from the fact that we always recommend the accompaniment of a real estate agent and lawyer who is familiar with the island, there are some tips & Tricks to include in your home buying checklist..
1. The Region of Mallorca
Sounds simple? Isn’t it always. Mallorca has quite a lot of facets and regions that differ from one extreme to the other. Under no circumstances should you choose a house and only then deal with the region or zone of the island (you can find more information about the different real estate regions here).
Only when it is clear whether Palma, Southwest, South/Southeast, Northeast, North, West Coast or even the center of the island can you go into more depth with the property search and the property types (in this article we will focus on single-family houses, whether finca, villa, chalet or townhouse). The house can be renovated at any time or built on a plot of land as you want it to be, but you cannot simply change the location after purchase.
2. In need of renovation or ready to move in?
Of course, there are clear advantages with a ready-to-move-in house, especially the point of convenience and being able to enjoy the property directly. On the other hand, these objects are always more expensive than its “little brother”, the one in need of renovation. The advantage of this second one is that it is usually cheaper and that you can adjust everything the way you always imagined it, down to the smallest detail in the house.
3. Legality of the house
This point in particular is one of the most important for most customers (it should be!) but at the same time a big question mark. Where exactly does it depend now? What is the infamous “Cedula de habitabilidad”? Does the house have a valid ETV or well license? It is best to always hire a lawyer and have a competent real estate agent by your side.
But here are the most important points for you (there are always exceptions, so always discuss them with your trusted real estate search partner):
– The Certificate of Habitability or “Cedula de habitabilidad”: It is the certificate that this house is habitable, but by no means proof of 100% legality of the property. However, it is always a good sign if the house has this certificate.
– A demonstrable building permit or building license: This is what really matters when it comes to legality proof. Always ask if the property has this and check what is registered (it has to be said that 90% of the houses and fincas in Mallorca are not 100% registered in these documents, and combined with some laws it can still be a good property purchase. .).
– Statute of limitations on infractions: Isn’t everything registered with the property? But you can prove that X years (8-10 years depending on whether urban or in the country) the buildings stand or are registered in the cadastral office/land registry? Then it’s not the end of the world. As already mentioned, the majority of the properties are partly legal, partly alegal (not completely legal, but not illegal either due to the statute of limitations).
– Request all remaining documents: Always request everything that the owner can prove. Well license, ETV holiday rental license, current land register extracts, plans, etc…
4. The orientation of the house
This usually doesn’t play a big role in town houses, but especially in villas, chalets or fincas you should pay attention to the orientation of the living area and swimming pool You also want to prepare the more than 300 days of sun at the swimming pool or from the kitchen at breakfast enjoy!
5. Financing for the purchase of the house
Oh yes… Funding is one of the most underestimated points… If you are lucky enough not to have to fund it, you can skip this point directly. But if you’re not that lucky, here are a few things to keep in mind:
– Do I finance through a Spanish bank?: There is a big difference between the conditions of a Spanish bank, or eg. a German bank. The Spanish bank finances e.g. about 80% for residents, but only about 60-70% for non-residents on the island. It is generally difficult to finance a foreign property with German banks, so we assume for the other points that you are financing through a Spanish bank!
– Calculate the additional purchase costs: How much is that? It depends, but in general you calculate 10% for normal properties and 11-12% for luxury properties. These additional purchase costs consist of the real estate transfer tax (ITP or IVA), notary costs, land registry costs and tax office costs.
– Documents I need to submit: In Spain, the most important is a permanent employment contract and the amount of fixed income (this does not include bonuses or variable payments). Schufa proof, the last 2 years account information and transactions, as well as other collateral are also important but rather secondary in most financing. There are always exceptions though, so it’s best to ask your real estate agent for advice (yes, good real estate agents should know finance too, or at least be able to recommend someone to you!).
Do you have any other questions? We will be happy to forward you to our financing professionals or, if you wish, directly to the selected bank!