Have you always dreamed of buying a nice little house or a beautiful apartment in a sunny country? Are you particularly fed up with the gloomy Belgian weather and its rampant taxes? And what about real estate in Spain?
Well, guess what, you are not alone, and many of our fellow citizens and European neighbors think like you. What is this country where the weather is so beautiful, close to us, with a rich culture and one of the best cuisines, and which, as an added attraction, has an ultra-attractive real estate market compared to all its European neighbors? Well, it’s Spain Madre de Dios! So take the plunge and sing with us: “We will all go to Tore Moulinos“. Here’s an overview of your next move…
The real estate crisis in Spain in a few figures
40%, yes, it’s 40% on average that the real estate market has lost since 2007 in Spain. Spanish banks that massively invested between 2002 and 2005 in real estate now find themselves with a real estate portfolio they no longer know what to do with.
To make matters worse for the Spanish citizen who is hit by an unprecedented crisis and cannot take advantage of it. Nearly 40% of young people under 28 are unemployed in Spain, and almost 20% of the active population is also unemployed.
A boon for the British, the French, the Russians and… the Belgians
22%, yes, 22% is the increase in real estate purchases in Spain between the second quarter of 2012 and the second quarter of 2013. So who are the Europeans taking the lion’s share? As usual, the British are keen (understandable given the salary levels in England and the dreadful weather there).
They represent 15% of real estate transactions; the French (looking for happiness elsewhere) account for 10% of buyers, the Russians (who have made it) represent 7.6%, and… the Belgians are in fourth place with 7.5% of purchases. For information, in 2007, the Belgians only represented 2% of purchases in 2007…
Proportionally, the Belgian appears to be the leading real estate investor in Spain, and they mostly buy second homes in the north and south of the Costa Brava (Alicante, Altea, Calpe) as well as on the Costa del Sol (Malaga, Marbella).
How to get a mortgage in Belgium to buy property in Spain?
Of course, if you want to acquire a property in Spain, you will – in the vast majority of cases – need to take out a mortgage.
At this stage, you will face a double difficulty:
Either you decide to take out your mortgage in Spain
In this case, you will have no difficulty with your mortgage, as long as you present a sufficient solvency situation. Indeed, the bank will take a mortgage on your property and will find sufficient guarantee in it. However, to take out a mortgage in Spain, you will need to be domiciled in Spain, which is not always desired by our fellow citizens.
Or you decide to take out your mortgage in Belgium
In this case, you will have no problem with domiciliation. However, you may encounter difficulty in constituting your mortgage. Indeed, no banking institution will want to take a mortgage on a property located in Spain. Indeed, the European agreements on assistance with recovery are not yet optimal, and this situation still creates many problems.
Therefore, the Belgian bank will want to take a mortgage on one of your properties located in Belgium. Consequently, this means that you must own a property in Belgium that is almost free of charges.
As the saying goes…
This attraction of Belgians to Spain seems to go hand in hand with a sharp drop in real estate transactions on the Belgian coast. A decline that real estate agents explain, among other things, by the increase in Belgian taxes on second homes, with many Belgian coastal municipalities having increased their municipal taxes.
The same situation in France, where the taxation on second homes and the taxation of capital gains have literally driven away foreign investors.
Finally, it should be noted that Spain is not an isolated case, many French and Belgians are investing in… Morocco for similar reasons.
