Without a doubt, at some point, we have wondered what should be taken into account before purchasing a property such as a house, an apartment, or a piece of land.
It's normal for this concern to arise, as our capital and assets can be affected if proper research isn't done on the property we intend to acquire.
Therefore, we believe it is of utmost importance that you take note of the following aspects and recommendations to ensure a transparent and satisfactory real estate purchase, which will prevent future problems.
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OWNER AUTHENTICITY.
When you are in the process of purchasing a property, it is essential and important to know that the person or entity selling to us is indeed the owner of that property. For this reason, it is important that they provide the necessary information backed by the General Registry of Property, where such circumstances are recorded.
We recommend that you verify, on your own or through a legal advisor, the current status of the property in the General Registry of Property, using the property's registration data.
CHECK LIENS OR ENCUMBRANCES ON THE PROPERTY.
In this regard, caution should be exercised and this should be done before signing any purchase agreement, as any real estate can be encumbered or have annotations on its registry that will affect the future buyer. For example:
- Mortgage
- Easements (light, passage, aqueduct, communication, power line, or electricity, etc.)
- Lifelong usufruct
- Immobilizations
Also, we recommend verifying that the property is up to date with payments for the Single Property Tax (ISUI).
PROPERTY VALUE FOR SALES AND TAX PURPOSES.
Information on all real estate can be obtained through the General Registry of Property and the Directorate of Cadastre and Appraisal of Real Estate. In this case, we can verify its historical value over time.
Therefore, when executing a purchase and sale agreement, its value must match the registered value of the property. Otherwise, the General Registry of Property may reject the transaction.
From this aspect, the taxes that must be paid for entering into a sales contract also arise, taking into consideration the following:
- If the real property has not been previously transferred, the corresponding 12% Value-Added Tax (VAT) will be paid on the purchase price.
- If the real property has been transferred two or more times previously, the 3% tax stamp corresponding to the sale price must be paid.
Deed of Sale Registration
Once the corresponding investigation into the current state of the property has been carried out, the relevant taxes have been paid, and the public deed containing the purchase agreement has been signed, the testimonial of the deed will be presented for proper registration with the General Registry of Property.
It is important to follow up with the legal advisor accordingly so that said registration is carried out and the property is legally in our name. Likewise, that the deeds of sale derived from the purchase are filed with the corresponding Municipality where the property is located and with the Directorate of Cadastre and Real Estate Appraisal.
