Among the most important things to keep in mind before buying a house is to know if the house you are going to buy has debts and find out the general expenses you will have to face and even possible spillovers.
You should also know the benefits and costs of buying a new or second-hand home. When acquiring a new property you will have to pay 10% VAT on the purchase value and if the house is officially protected that VAT will be only 4%. This does not happen with a second-hand house since you will not have to pay VAT, but you will have to pay the Property Transfer Tax or ITP
Tips before buying a second-hand home
To check the condition of the property you are going to buy and if there are any outstanding charges, you can go to the Land Registry to request a Nota Simple Informativo. This document contains key legal information such as the following:
-Description of the property with the location, the type of house, the built and useful area, polygon, plot, cadastral reference and horizontal division. These are the basic facts of the house.
-Ownership of the property. That is, whose house it really is.
-Charges such as mortgages and other debts. These burdens weigh on the property and not on the owner, so if they are not paid, they would become the new owner's.
Mortgage
If you need to apply for a mortgage, you must take several factors into account, mainly interest rates and especially the evolution of the Euribor and its forecasts.
In relation to the bank's requirements, it will give you a mortgage of no more than 80% of the value of the house, to which you will have to add additional expenses. They will also take into account your expenses and income. With few exceptions, most will limit your borrowing capacity to between 35% and 50% of your expenses, depending on the value of the house.
Expenses to be taken into account
The average cost of expenses added to the purchase price of the house is between 10% and 15%.
We should also ask about the maintenance costs of the house. Here are the most important ones you should know:
-Cost of supplies.
-The IBI
-The community of neighbours
-Boiler, air conditioning and plumbing, electricity
-Home insurance