Moving to Spain - the Easy Way? Chapter Five.

 MOVING TO SPAIN – THE EASY WAY? Chapter Five – the boring bits! 

Finding our dream home in Spain was fun.  It was just like being a child again in the sweet shop, clutching my pocket money and deciding what I would buy with my pennies.  However after the excitement of deciding what we wanted to buy within our budget, we came down to earth again and realised that there was a lot to be done before we would be able to sign on the dotted line.

In Spain, when you are buying “off plan” on a new development, you pay a nominal sum (3,000 euros in our case) to secure the plot you want. You then have a set period of time in which to check the contract, sign it, and pay your deposit.  The actual amount of deposit required varies but 30% seems to be the average.  The balance, whether you are paying cash or getting a mortgage, will be required on completion.

Unless you can afford to lose the money, make sure that you have a Spanish lawyer to check the contract, preferably one who speaks good English unless your Spanish is particularly fluent.  Whatever you do, don’t use the same lawyer as the developer, and it is also advisable not to use a lawyer recommended by your agent, as there is a potential conflict of interest there.  Speak to any people you know who have already bought in Spain, research on the internet (you may get a recommendation through a forum), talk to people at property shows, but if possible try and get a personal recommendation.  One company that was recommended to us at a property show is the legalexgroup: www.legalexgroup.com, although by that time we already had our own solicitor.

You should also ensure that you have a bank guarantee, before parting with any money.  This is to cover you if the builder goes bust or if there are problems and you need your money back.  Check the contract to see what compensation clauses have been included, if any.

Our lawyer Monica speaks good English, and went through the contract very carefully, before telling us that there was something she was unhappy with, and that she wanted the developer to provide us with a new contract. It was an incorrect date, which I thought we could have changed and initialled, but she was insistent that every detail had to be accurate before we signed anything.  We didn’t sign the contract until we had received the replacement and she was happy with it, which was very reassuring. 

Monica also gave us a quote for future costs, such as a mortgage to pay the balance due on completion and drawing up new Spanish wills, as our UK wills would not apply to our home in Spain.  Spanish law does allow for UK citizens having UK wills, which you will still need for any assets in the UK; however you need to be aware of the difference in inheritance tax laws in Spain, which tend to favour children rather than spouses.  As our plan was to become residents in Spain, we knew it would be sensible to get Spanish wills too.

Our lawyer also helped us with the process of getting that all important Numero de Identificacion de Extranjeros (NIE number).  This is basically a tax identification number and you need one if you are going to reside and/or buy a property in Spain.  Monica arranged for us to be picked up at what sounded like a ridiculously early hour, to ensure that we arrived at Elche police station early enough to be sure of being towards the front of the queue. Only a specific number of people will receive their NIE number on a particular day so you have to be there early to guarantee that you will be one of them.

Our agent, Stella’s husband Mark, picked us up from our hotel. We had negotiated with the restaurant manager at the hotel the night before, so we were able to have a coffee and continental breakfast before they officially started serving breakfast.  Mark dropped us off in the middle of Guardamar at what felt like the crack of dawn, and we were picked up by Jose, a clerk from the solicitors, who spoke a bit of English and had all the necessary papers for us to obtain our NIE numbers.  We had already provided copies of our passports and had the originals with us.

We picked up another British couple en route.  The husband George spoke good Spanish, so he sat in the front and chatted to Jose, but his wife Sheila told us that she didn’t speak any Spanish and wasn’t too bothered about learning any.   She said that George was more than capable of communicating in Spanish so there was no need for her to bother. 

Sheila was a lovely lady, so I wasn’t going to argue with her, but I couldn’t really agree with this statement.  She was going to be living in Spain too, so I felt that she should also learn some of the language and not have to rely on her husband.  Their immediate neighbours were English; however Sheila would be missing the opportunity to get to know her other neighbours and to really get involved in and enjoy the Spanish way of life.  However that was her choice, and I am sure there are many people like her, who are quite happy to live amongst other ex-pats.  If you are one of them, you need to be sure that you live somewhere where English is widely spoken, otherwise you risk feeling isolated.

Jose had picked George and Sheila up in La Marina, so I asked Sheila if they were living there.  “No, we are buying a house in Urbanización – do you know it?” she asked.  She was blissfully unaware how many towns are called “Urbanización” in Spain, no doubt in part because she didn’t know the language.

When we arrived at Elche, we could see why we had to have such an early pick-up as there were already quite a few people ahead of us.  It was also fortunate that we were there early, as when Jose from the solicitor’s office looked through our documents he told us that one of the photocopies wasn’t clear enough, which potentially could have caused problems, so he disappeared to get a better copy.

At 9 o’clock, they started calling people through and it wasn’t long before it was our turn.  The actual process was quite quick: they checked all our paperwork, then we were told to “sign here”, which we did, and that was about it.  The NIE numbers would be sent to our solicitor later, so it was back to the car and the return journey to Guardamar.

One tip that we found helpful, and which potentially saved us a lot of money, is not to use your bank when transferring the 30% deposit, or any other large sums of money, from the UK to Spain.  There are many currency exchange companies around who will give you a better rate than the high streets banks, plus they will ensure that you don’t have to pay receiving charges, which are commonly charged by Spanish banks.  You can register with several companies for no cost, then shop around for the best deal when you are ready to transfer funds. 

An alternative is to pay the company a 10% deposit and ask them to wait for an agreed exchange rate for you, which is known as forward buying. This is useful if the current exchange rate is quite low and you have time to wait for an improvement in the rate, although you also run the risk of the rate dropping even lower. 

Some companies set a minimum amount for the funds you are transferring if it is a one-off payment, and will charge a fee if you transfer less than that.  They also have the facility to transfer funds for you on a regular basis, which is particularly useful if, like us, you are going to be retiring to Spain and will be transferring your pension to a Spanish account either monthly or quarterly.  They will usually guarantee the exchange rate for one or two years, so you have to decide whether you want to agree a rate for that period of time.  You risk losing out if the pound gets stronger, but at least you don’t have to worry about the pound weakening, plus you have the advantage of knowing how much money you will be receiving each month.

We also needed to get a Spanish bank account, even though we wouldn’t be living there for a couple of years.  Stella helped us with this, recommending that we open an account in the nearest town to our new home, which was Jumilla.  Although we have been told that everything that you do in Spain involves a lot of paperwork, this particular process seemed simpler than it is in the UK, and with a bit of help from Stella, both in ensuring that we had the right documents and in translating for us, we were soon the proud owners of a bank pass book for the CAM bank in Jumilla.

Health insurance is another issue that you should be thinking about before you make a permanent move.  You will be able to use your EHIC card initially, but once you are a resident you need to make sure that you are covered for medical care in Spain.  If you are a pensioner or in employment you should be fine, as you will be covered for treatments in a similar way to the NHS in the UK al though some people do pay for additional private cover.  Remember, too, that once you are resident in Spain, you will only be entitled to emergency treatment when you return to the UK.

There are several options when it comes to uprooting yourself from the UK and moving yourself and your belongings to Spain.  There are many removal companies who will give you a quote for either a full load or part load.  You can also hire a van and do it yourself, preferably with somebody else to share the driving, as it is a long way from the south coast of England to the Costa Blanca, Costa del Sol or wherever your new house is going to be – and even further if you live north of Watford.  Allow for overnight stays too, and work out whether you will save a lot of money by doing it yourself and if not, whether you think it is worth the effort.  We decided to go for the minimal approach: take all our clothes, books, CDs and personal trinkets, but leave the furniture and white goods behind. 

We decided to use a well established company called Over’s, partly because I liked their method of giving us an initial quote.  We had met Gary, a representative from Over’s, at “A Place in the Sun Live” exhibition, which was held in the Excel centre in London.  Gary told us that they would charge £300 + VAT for the equivalent of three washing machines, which was the minimum for a part load.  Obviously a full load would work out comparatively cheaper.  I thought that visualising washing machines was a good way to calculate the size of our part load.

 Gary said that they would also store our belongings in the UK until we needed them bringing over to Spain and depending on how long that was, there would be no additional charge.  Their website can be found at http://www.overs.co.uk/ , and you will find details of other companies in the adverts at the back of any of the magazines on buying property and living in Spain, such as Living Spain. 

We wanted new furniture for our new home, so we decided that we were going to buy a furniture pack.  Again it is worth shopping around. You can use the internet to look at different companies to find the styles and prices that suit you and then contact the companies by email.  Some of them will have showrooms in the UK so you can see the furniture for yourself, although many of the companies are based in Spain.  We visited several showrooms on the Costa del Sol and Costa Blanca before finding the one we preferred.

One advantage of buying a furniture pack if you are buying a new property is that the company will install all the lighting for you and set up your new home as if it were a show house, so that you can literally walk straight in. It might be cheaper going to Ikea in Murcia, but I didn’t fancy going through all the flat packs and assembling all the furniture for a complete house.  Just one chest of drawers took John and me almost a whole day to assemble and our nerves were frazzled by the end of it. 

 The company that we decided to buy our furniture pack from was Furniture Express: http://www.furnitureexpressspain.com/.  The quality of their furniture was very good and we liked their styles.  They were also willing to be flexible, so we chose a double bed that we particularly liked rather than the one included in the pack, plus a couple of lamps and pictures that we preferred.  Another company that impressed us both was Inside Right, who also sell good quality furniture at competitive prices: http:/www.insiderightespana.com/ 

A year later and there was a six month delay to the development and our new home, which should have been ready in January 2008, still only had its foundations. We decided to rent a property in the town of Jumilla and ask the developer for a contribution to the rent that we would have to pay until our home was completed.  We had already spent a couple of holidays in Jumilla, the first one being prior to signing the contract, so we knew we would  be happy living in the town for six months or however long it took.

Initially we were both working, so we didn’t do the really sensible thing and rent for a while before looking for a property to buy, however once we both decided to take early retirement, we realised that there was no reason to wait for our new home to be ready.  We could rent an apartment until we were able to move into our house in Santa Ana and Jumilla was the obvious place to rent somewhere as it was only a few miles away from the development.

We spent a rainy afternoon walking the streets of Jumilla and visiting all the estate agents, to see if they had any property to rent.  We looked at a large old apartment, overlooking the main street.  It was a good central location, though we did wonder how noisy it would be when the landlady proudly told us we could watch the processions and hear the music from there.  Apart from concerns about the noise levels, we decided that it was a bit too big for us anyway. 

Another property that we viewed was a modern apartment, overlooking the park.  The young man from the estate agent’s office really loved it and sat down on the modern leather sofa as he extolled the virtues of the apartment.  We had noticed though that it was on the first floor and there was a bar on the corner of the block.  Knowing how the Spanish love to sit outside on a summer’s evening with a cerveza or glass of vino, chatting loudly with their friends, we agreed that this wasn’t the place for us. We also felt that it was too modern and somehow lacked character. So we told him “no” and left him sitting there, shaking his head sadly and clearly of the opinion that the British couple were mad not to take it.

The last property that we saw was also an old traditional Spanish apartment, although not quite as big as the first one.   It had a spacious living room, with a balcony overlooking the town and with good views of the mountains, a reasonably sized kitchen, a bathroom and three large bedrooms.  The man from the rental agency, Habitacasa, knew that we were looking at other properties, so we promised to go back in the morning and let him know our decision.

On our final day in Jumilla we returned to Habitacasa and told the agent, Manuel, that we wanted to rent the apartment from the beginning of April.  His English was even more limited than our Spanish, so we rang Stella and handed him the phone.  She explained to him what we wanted to do and found out from him that we would have to pay 150 euros as a sign of our intent to rent the apartment.  The remainder of the rental deposit would be paid when we signed the contract, as well as the first month’s rent. 

Manuel carefully wrote out a receipt, showing us his identity card so we that could check the number was written down correctly, and copying John’s NIE number painstakingly, while I glanced at my watch and wondered if we would be in time to catch the bus to Murcia.  Surely 20 minutes is more than enough time to write out a receipt? Obviously it’s not, when you are in Spain.

Luckily the bus was a bit late, so we managed to catch it.  We had already noticed that whenever you buy tickets at the local bus station, the time the bus is due is printed on them followed by “approx”.  This means that buses are rarely late: if the 10.00 “approx” bus doesn’t get there until 10.10, you can’t really complain that it should have been there at 10.00, can you?  I like the Spanish logic.  In future I will tell John I am meeting him at a particular time “approx”- that should stop him complaining about my punctuality!

The rental contract was sent to our solicitor in Guadarmar, who checked it carefully and told us it would be fine to sign the agreement.  At the beginning of April we returned to Jumilla to take over the apartment.  Stella had agreed to meet us and help with any translations that were required as our Spanish was not good enough to cope with legal and property matters, though we know enough to ensure that we will never starve or go thirsty.

We went back to Habitacasa, where Manuel sat us all down and then slowly read out each clause on the rental contract, whilst Stella helped us with anything that we couldn’t understand.  The landlord and his wife were going to meet us at the apartment, where everybody would sign the contract and we would hand over the money in return for our keys.  When we got to the apartment, we all had to sit down again while Manuel slowly read out each clause on the contract, this time for the landlords’ benefit. 

Once this was done, the four of us had to sign each page of the three copies of the contract (one for us, one for the landlords and one for Manuel).  As the landlord’s signature was just a squiggle, he had to print his ID number underneath each time he signed a page, and John had to write down his NIE number underneath as his signature was just as bad.  Luckily the two women present had legible signatures, so we didn’t take quite as long signing the pages. 

We had arranged to meet at Manuel’s office at 10.30, as we planned to take Stella out for lunch before she had to drive back to her office on the coast.  By the time contracts were signed and money and keys exchanged, I was starting to feel hungry, however we still hadn’t finished.  Our landlord took us round the apartment, showing us how to turn on the gas, light the oven, use the washing machine etc. 

At long last, we thanked them and walked towards the front door, thinking we could now head to the restaurant, but we were still not quite finished.  The lady who lived in the apartment opposite ours came out of her door as we were about to go into the lift and she had to be introduced to everyone.  Another long conversation ensued, with lots of smiles and nods, until we finally shook everybody’s hand and left to go to the restaurant.  I glanced at my watch: it was already well after 1.30, which was hardly a surprise as my stomach had been feeling hollow for over an hour.  We had a lovely lunch with Stella, thanked her again for all her help, and went back to our new home in Jumilla.  That evening we celebrated by sitting on our balcony, enjoying a glass of cava, as we watched the sun setting over the mountains.

I sub-titled this chapter “the boring bits”, however we enjoyed a lot of the practical procedures that we had to go through in both renting and purchasing a property in Spain.  It was all part of the learning curve, and we started to understand the way things are done in Spain, which can be very different to the way things are done in the UK.

Once you have your NIE number, you should think of registering on the Padron.  Every municipality in Spain has a record of local residents, which is known as the Padron. This is held at the town hall (Ayuntamiento) and is similar to the electoral register in the UK. If you are going to own a property in Spain you should register, whether you intend living there permanently or not.

Although it is not compulsory to be registered, it benefits both you and the municipality that you are living in.   The level of funding that the local area receives depends on the number of people registered on the Padron, and as this funding is used for essential amenities such as the police and health centres, it is obvious why foreign residents should register so that basic services do not suffer because of insufficient funds. 

There are numerous advantages to having a certificate of empadronamiento (issued to you when you register on the Padron). If you have children, it means you can enrol them in local schools.  It also allows you to take advantage of any local leisure facilities with discounted rates at the municipal sports centre.  You may also need it if you are looking for work locally.

 If you are an EU citizen, you should also apply for residencia, which is a resident’s card showing that you are resident in Spain, and is obtained by registering at your local Oficina de Extranjeros – Foreigners’ Office.  Rules change and may vary depending on where you live, so it is worthwhile checking the latest regulations before applying.  At the time of writing, it appears that cards are no longer going to be issued and it will be a certificate.  Rumour has it that you need to be on the Padron before applying for residencia, but you now have to be registered as a resident before you can apply to be on the Padron.   Confused?  So am I.  One thing that seems certain is that you cannot go on the Padron or apply for residencia status without your NIE number. 

This is not going to be an account of everything you need to do to purchase a house and live permanently in Spain, as there are many good specialist books on the market.  This is more to do with our own experiences of the buying process, which may also help you think about what is involved and identify gaps in your own knowledge. 

I bought an excellent book called “Living in Spain” from Blevins Franks, although I have to say that if I read it too late in the day, it would send me to sleep. However financial and legal matters do have that effect on some of us, so it is certainly no reflection on the authors.

Far more accessible to the layperson if you are buying in Murcia, is the excellent new book by Debbie Jenkins: “Buying property in Murcia”. Much of the advice is relevant even if you are thinking of buying a property in a different region, and there is plenty of good common sense, as well as stories about other ex-pats’ experiences and the ingenious “Location-o-Meter”, Debbie’s tool for identifying the location to suit you.  I only wish she had written it a bit earlier, as it would have helped us understand the buying process a lot better!

One of the key people who helped us on our various trips to Spain was Stella, from Salt Lake Properties, the estate agency that we had used for our successful viewing trip: http://www.saltlakepropertieses.com/. We may have been able to manage without her, but it certainly would have been a lot more difficult on our own, especially with our limited knowledge of Spanish. 

I suspect that one factor that made Stella different is that she runs a small family agency with her husband Mark, which means that she is able to provide a more personal service.  Once Stella found us a property that we wanted to buy, she didn’t abandon us to cope on our own.  Both she and Mark helped in many ways: driving us to the developers, San Jose, when we wanted to discuss which extras we wanted; taking us to the solicitor’s office to discuss signing contracts, or to obtain NIE numbers; showing us round furniture showrooms when we were selecting furniture and of course helping by translating the rental contract after we found an apartment to rent while waiting for our new house to be completed.

Stella and Mark keep in regular contact with us both by email and by phone, updating us whenever there is any news and chasing the developers on our behalf, which I gather is more than can be said for many of the larger, well-known companies.

 Key Points: ·        Always use an independent solicitor, who speaks fluent English as well as Spanish.·        If buying off-plan, make sure that you have a bank guarantee.·        Rent in the area before you buy if possible.  Otherwise, do try and visit it at different times of the year before deciding whether to buy there.·        When transferring large amounts of money, or regular amounts such as a pension, use a specialist currency exchange company rather than your bank.·        Do register on the Padron, which helps your local community get extra money for vital services such as the police and health services.  When people fail to do this, it over stretches the budget for the local community, which won’t get the service level it needs.