Hi I am new in here

and I am in a bit of a quandary as to what to do particularly in light of the current economic climate. My wife is set to inherit a second property (in the uK) once probate is over We had a couple of valuations running to about 200k.According to the estate agents although the market has slowed developers are still buying them and cannot get enough which rather raised our hopes .Our aim is to make the house habitable and let it ,banking the proceeds . In the meantime we thought we might buy an apartment or town house( £60-70k) which we could let for the interim period until we are both ready to retire in about 8 years time. By that time we should look to sell the current house we are living in buy two flats and let those together with the inherited house. The proceeds, together with our pensions, we hope will enable us to live reasonably ,assuming the cost of living is lower in Spain.Any advice as to which part of Spain , location and type of property we would best aim for would be gratefully received .I am also guessing that we should wait at least a year before making a purchase as prices may well fall.We are in the happy position of having the cash to buy said property so no loans would be required. Thanks nb my wife originally wanted to borrow on the strength of her inheritance enough money to buy a flat( without selling our current house) paying for the mortgage with the rents received from two properties. I felt that was too risky and the repayments for a 100k loan over 10 years would be too huge -hence my suggestion above.Thanks again

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Hi Donmaico,

Welcome to EOS

Financially you are in a good position, waiting for a year could be a good/bad option.

Certainly the Spanish property prices have fallen but who knows what will happen in a year's time?

However, you could use that year to travel around Spain, finding your own special place to retire.

Everyone on this forum loves their part of Spain, so asking where to retire to would confuse you with hundreds of suggestions!

The cost of living IS lower in Spain, so your golden years will be cheaper.

I wish you luck with your search, dig around the threads on EOS, you will find lots of good advice.

Kind regards,

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Donmaico & Mrs Donmaico  

Any advice as to which part of Spain , location and type of property we would best aim for

That's totally your own personal choice. You really need to look around & take your time. Most would love to be in your position.

This forum is CHOKKA with info though most members don't seem to use the search facility,  which I find sad, as all too many of us have typed well into the early hours in order to post help & advice & just our own thoughts & experiences.

I'll look forward to hearing further from you.  

This message was last edited by morerosado on 2/14/2008.

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Thanks for the replies .Reading through one or two threads it seems that some people who are in good position to give sound advice state that because of the current credit squeeze, its not good time to buy now rather later as they believe prices are set to fall due to supply outstripping demand. Also because the rental sector is saturated ,properties should only be seen as either long term investments , somewhere to retire to or a second home.In the light of that I wondered whether some areas are worse affected than others or whether the type of property and its location had any bearing?(They do say location is everything here in the UK.) Would an old style town house near the Costa Brava or Barcelona be a wiser investment then Ghandia near Valencia ? The Bay of Biscay / Atlantic coast is, apparently,a popular with Spanish holiday makers which could make it a good option, I have not travelled widely throughout Spain to be able to give an opinion as to which areas are more sensible or attractive. Been to Barcelona which I liked a lot , Valencia was ok but Ghandia was not ,,In fact i get the feeling a lot of these areas may have been spoilt by excessive development, One thing that stands in my favour is that I speak Spanish as the result of having been borne in Argentina so that is always an advantage. In fact i am quiet tempted to returning there as prices are very cheap. Downsides are continuing instability and rising crime though.Spain has its attractions but the pitfalls are worrying. One hears about people losing their properties without compensation due to lack of planning permission, of unwanted further developments on ones doorstep , of incompetent Spanish builders and sharks legal or otherwise when one does not expect them. This is why I need advice and must do research before committing myself


This message was last edited by donmaico on 2/14/2008.

This message was last edited by donmaico on 2/14/2008.

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must do research before committing myself

You've come to the right forum then. 

When you know all the answers there are at least 22,000 likely that will love to read about it. Sometimes, if we went into it as much as you seem to want to, we'd never have bought & not all of us have had hassles.

However, I'm not being flippant & well understand you don't want to make a wrong decision (who does ) but it doesn't mean that you won't. It just means you've done lots of research which wasn't enough, like many members on Spanish forums. Often, what we've done is just not enough, sadly.  You just have to try & get it right, don't you ?

This message was last edited by morerosado on 2/14/2008.

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I would certainly recommend you take sound financial advice as whilst I understand you wanting to buy cash, you will in this case leave yourselves wide open for inheritence tax payable on the death of either of you

There is no transfer involved as each of you will own half a house. Therefore the inheritor will have to pay death duties before being able to take clear title to the property. A mortgage is usually sounds advice (depends on circumstances) and speaking to Smiley on the forum certainly is email patrick@marbellamortgages.com

Re where to buy, again that really depends on personal choice, when you are looking to use it etc. For 60-70k (I am assuming sterling so approx 100k euros) bear in mind you will have purchase costs between 10 and 14% depending on if purchased cash or mortgage. Perhaps a village house would suit you which could be rented out to the locals for the timebeing until you are ready to retire there. When you go to buy watch out for community fees - all urbanizations are privately owned in essence by all the house/property owners and incur costs for upkeep. These are charged monthly and usually payable quarterly.

Many village houses dont have this and all infrastructure is paid for via the yearly rates (ibi) which is pretty cheap.

Other than that I guess to decide inland or coastal, and take it from there

Good luck with it.

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As with all things there is always an element of chance ,even with all the research under the sun.I thought d star in here to see what others experinces were. Buying in the UK is easier ( although still fraught) for we understand the system better. Spain is a foreign country with ways which differ from ours.One wonders whether the Spanish authorities really appreciate all these Brits coming informing small enclaves here and there. It could be that some discriminate against them. I came in here because i am right at the bottom rung knowing precious little , hoping to rely to some extent at least,on the advice of others who have far greater experience. One other area of concern is management charges and how much control one has over them ie inflation.

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I certainly agree with RIxxy that a village house that can be rented out all year to Spanish is probably the best bet in the present climate if you need to guarantee the income.  It is becoming harder and harder to get a proper income from holiday lets with the general over-supply, and even the Spanish holidaymakers, who could be relied on to take the whole of August and fill just about every available apartment, are no longer able to afford much more than a week or ten days because of being so indebted.

You are lucky to have the luxury of time on your side in order to not have to rush into anything.  Do plenty of research and you should get a real deal.

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In which case a property in a city a such as Barcelona or Valencia( or villages nearby) might make more sense. Btw, Rixxy, are you suggesting taking out a mortgage makes more sense than buying right out with cash because of IHT ?Dont quite follow that. thanks

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There are two books, Buying a house in Spain and You and the law in Spain which could answer some of the questions you have.

If I've understood you correctly the place you buy will become your retirement property later.  So it's not going to be a place purely for investment purposes.  As you don't know Spain then I'd holiday in the areas you have short listed. 

With the budget you've given I'd be surprised if you could buy without taking out a mortgage, even taking in the current climate.

You need to buy wisely, even though prices are going down if you've picked wisely then they will go up, especially in your time scale.

If you make a mistake then you will have to pay 18% CGT when you move, plus 7% tax on your new purchase.

I'd suggest working out a budget of what it's going to cost your to maintain the property for 2 years, after that hopefully you will have it rented out and paying for itself.  You'll also have to factor in the tax you'll have to pay on the rental income, this should all be explained in the books mentioned above.

 

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thanks for that. I'll certainly buy those books . Buying /owning property abroad is certainly not without its hassle. Some have ended up feeling very bitter.The large cities are prohibitively expensive. I thought maybe to buy near one and let to Spanish couples as somewhere they can commute to work from but then it would have to be in a reasonably pleasant location as well.Mmm, so much food for thought.


This message was last edited by donmaico on 2/14/2008.

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Donmaico get these books by David Hampshire  http://www.amazon.co.uk/Buying-Home-Spain-David-Hampshire/dp/1901130363 & http://www.amazon.co.uk/You-Law-Spain-David-Searl/dp/8489954410 also this one by David Searlhttp://www.amazon.co.uk/Best-Places-Buy-Home-Spain/dp/1905303289/ref=pd_sim_b_img_2

Some of these books can be read online. (Well, to give you a flavour of what's inside). Scroll down to nearer bottom of page & click on book if it says that you can "search inside" top right corner.

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Thanks

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