Buying Process

THE PRIVATE CONTRACT - Once you have decided on the property and agreed a price, the first step is to sign a private purchase/sales contract. Your lawyer will draw up this contract and all details relevant to the property will be included in the contract i.e description of the property, price, form of payment, penalty clauses etc. Contracts will be given to both parties, and their legal advisers. On signing of contracts, a 10% deposit will be required. The private contract is normally for 30 days, or longer, if mutually agreed by all parties.
SEARCHES -  During the period of the Private Contract, prior to signing of the Escritura (Public Title Deed), your lawyer will carry out a search at the Registro de la Propiedad (Land Registry Office) to check that the vendor is the registered owner of the property and ensure that all taxes have been paid and to establish if clear title exists, or it there are any debts, charges, mortgages or encumbrances. A Nota Simple will be obtained which will give this information. It will also be necessary to ensure that there are no outstanding bills for utilities such as water & electricity and also that the I.B.I (rates) is paid up to date.
Once the searches have been made and the property is free of all encumbrances the next stage is to complete the purchase and sign the new Escritura at the Notary’s office. If you are unable to attend you can give Power of Attorney to your lawyer to complete the purchase and pay the relevant taxes on your behalf. 
Once the new Escritura has been signed, and taxes paid you can take the keys and possession of your property unless any special arrangements have been made. 
You will receive a Notarized copy of the new Escritura and the original will be sent to the Registro de la Propiedad for inscription into your name. 
TRANSFER OF SERVICES - Having completed the purchase it is necessary to transfer the water, electricity and telephone services into your name. Regular bills can be paid by a direct debit through your bank. 
INSURANCE -  Normally Spanish insurance companies offer a split policy, whereby the property and its contents are assessed separately.
 Additional Costs - In Purchasing a Property 
There are a number of fees and taxes that have to be paid in order to get your new title deed (Escritura) registered.
a) Notary fees. These vary slightly from property to property depending on the complexity of the title deed and the value of the property concerned, but will normally be about 1-1.5%
b) Registration fees. Again these vary slightly according to the declared price on the Escritura but one should calculate approximately 300 -  500 Euros
c) Transfer tax. Re-sale property bears a charge of 8% for property up to 400,000 euros, 9% for property from 400,00,01 to 700,000 euros and 10% for property over 700,00,01 euros of the price declared on the new Escritura but is exempt from VAT. This tax shall not be applicable for properties being bought from a developer or building company, but VAT at a current rate of 7%, plus 1% stamp duty is payable.
N.B. The total cost of all the transfer taxes and fees will be in the region of 11- 15% of the purchase price of the property. In order to avoid incurring further costs, the assistance of an independent qualified lawyer is strongly recommended. 
Plus Valia is a tax relating to the increase in the value of the land only, and is calculated and applied by the local town hall according to the increase in value between the present purchase and previous sale; the value or size of the building does not affect this tax. The vendor normally pays this tax, unless otherwise agreed by both parties.
Retention tax is a tax relating to capital gains on the property and only applies to a Non-Resident vendor (if resident, any capital gains due would be paid in the persons declared annual tax returns). To ensure that the vendor, upon the sale of a property, pays capital gains tax, it is the purchasers’ responsibility to retain 3% of the declared value and pay to Hacienda, the Spanish tax authorities. The purchasers’ legal representative would normally handle this matter. The vendor, at a later date, can claim back any tax that may be due. This tax only applies to privately owned properties registered after 1st January 1986. In the case of company owned properties, this tax would apply to those registered after 1st January 1976. Properties registered prior to these dates, respectively, are exempt.
Lawyers fee will depend upon the services rendered. The normal custom is for the purchaser to pay these fees and taxes. Lawyer fees should not normally exceed 1%.
Energy Performance Certificate - The Spanish Government has passed a new law which will affect all property for sale and rent (for more than four months of any calendar year) on or after 1st June 2013. A property for sale or rent must now have an Energy Performance Certificate, issued by an official installer.
As a purchaser ensure that  the property you are purchasing has this certificate as it will be required by the notary upon final signing and transfer of the title deed into your name. The cost of this certificate will be paid for by the vendor. The certificates have a validity of ten years from the date of issue.
When buying a property in Spain you will need a N.I.E number, Numero de Identificacion de Extranjero.. This is a Foreign Identification Number and will be needed to open a bank account, apply for a business permit, apply for a mortgage or loan, buy or sell property, buy or sell a vehicle, Social Security, pay taxes etc.
You can apply for the N.I.E number at the local police station in person or give Power of Attorney to your lawyer to obtain this for you.