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Spanish Property Valuations
This is a question many people ask as it seems difficult to find out how the banks here in Spain value property. Some valuations do not make sense when compared to a true market price. How can a property with only the back of another house as its principal view be worth as much as the same type of property with fabulous open aspect and with the luxuries of a gymnasium or leisure centre in the grounds.
Below Direct Auctions hope to help you understand how valuations in Spain are carried out. This should then make you aware of what you SHOULD be paying for a property.
The Valuation
When you decide to buy a property and certainly if you need finance, then the bank you apply for a mortgage in will need to send around a valuer. Unlike the UK, this person is not sent to check the structure of the proeprty, it is to measure the property and check any documented specifics are correct. If there are any obvious flaws with the proeprty, this will be pointed out to the bank / buyer, but this is not a structural survey.
The majority of properties have title deeds stipulating the area, size and ownership of a property. There is a shorter versiopn of this, called a Nota Simple. This has the details of which Notary office the property is registered in and the property numbers for reference. We must state that in Spain it is not a legal requirement to have a property registered at Notary UNLESS there is a mortgage registered on the property.
This nota simple is requested by the bank to proceed with a valuation. The property will be measured by the valuer as it is the interior build size that attracts the most of the value for mortgage purposes. The terraces are measured as is any storeroom, garage or remaining land. The property area is then multiplied by the price per square metre that is the average in that area. So for example, a 100 sqm apartment in Marbella would attract approximately 3000 euros per square metre, meaning this example would be valued at 300,000 euros.
Basements, garages and storerooms not fitted out and without windows would attain approximately 50% of the interior rate, terraces around a quarter and land is very low reaching an average of 300 euros per square metre as garden.
The property build quality is crucial as a higher standard would raise this basic valuation, a lower standard would decrease the valuation and this is determined by a adding or taking away a percentage of the overall valuation price.
Once this valuation is done, the process is not complete as the report will need to be prepared and sent to the bank head office. The report is checked for irregularites weither way and a standard of comparison is applied of similar properties in the same general area. This can cause fluctuations if valuations depending on the comparision! Any unsatisfactory report can be challenged by showing a copy of another valuation of the neignbours apartment, for example and should result in the valuation itslef being amended. This report and your paperwork will then be rubber stamped with the final written offer sent to you.
Approximate Area Valuation Rates
Marbella, Nueva Andalucia, San Pedro, Benahavis, Estepona, Elviria, Cabopino - 3000 to 3500 euro per sqm
Calahonda, Riviera del Sol, Mijas Costa - 2500 euros psqm
Fuengirola, Los Pacos, Benalmadena, Torremolinos, Malaga outskirts - 2000 euros psqm
For a more exact valuation of your property, contact us
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