There have been some important changes to the Spanish NIE number procedure and transfer taxes.

Please read below for some of the highlights.

We also have an exceptional offer for Spanish wills for the month of March at only 50 Euros.

It may seem an obvious statement, but it is important to keep your affairs in order. You would be surprised how many individuals and businesses slowly lose track of things such as accounts, taxes, rates and the accompanying paperwork. It’s a bit like climbing a slippery slope – once you start to lose your footing the chance of sliding all the way down becomes ever greater.

For that reason it is best to stay on top of things, and to do this you need to know what your basic rights and obligations are; what is owing to you and what you owe others, including the authorities. This applies to businesses, but also to private individuals, especially those who own property. When you own a property abroad you must bear in mind that it almost always comes with its own running and administration costs.

In order to improve the status and reputation of Spain's huge real estate industry three new qualifications (covered by the BOE. 276 Royal Decree 1550/2011 of 31 October) have been introduced that should improve the quality of professionals working in the industry.

The most basic of these, Commercial Real Estate Management, ensures a desirable level of competence. The legislation covering this qualification notes the content of this course: “Securing and marketing products and focusing on assisting real estate mediation and legal procedures, plus fiscal and financial aspects of the sale, purchase or rental, in direct contact with the customers or through various marketing channels, coordinating a team of business and using, if necessary, the English language.”

The Spanish government has recently passed new laws aimed at encouraging property owners to rent out their properties. It is hoped that, by simplifying the eviction process, non-resident homeowners will be tempted to become landlords. The new law will also speed up the judicial process with which landlords were formerly faced when requesting that tenants vacate the property due to non-payment of rent.

Horror stories in the UK press have led to certain reservations amongst potential purchasers of Spanish property. Various TV programmes have also helped to portray Spain as the land in which one's beloved home can be declared illegal and bulldozed virtually overnight.

As overheated and inaccurate as many of these sensational reports are, the Spanish Government is mindful of this bad press and now seems determined to rectify the situation.

From now on, ex-pat home buyers will be able to request a Land Registry Certificate (or nota simple) in English from the Colegio de Registadores. The certificate can also be obtained via the website by visiting: http://buyingahouse.registradores.org and will cost 29€ plus VAT, which includes a translation fee.

Holidaymakers wishing to travel inland to experience the 'real Spain' will be very disappointed to learn that a new law, developed by the Junta de Andalucía, will effectively outlaw the popular casa rural rental home.

In general rural Spain is peaceful and unspoiled, offering visitors an experience far removed from the bustle of the coastal resorts, and the casa rural has become a key part of this authentic experience.

It is estimated that more than 2,000 privately operated homes in rural areas could be put out of business by a new law, currently being submitted to Andalucía's regional government, which will make private rental of rural properties illegal

In what are difficult times for a great many beleaguered homeowners, news that the government has initiated a series of rulings that step up protection of mortgage holders will be eagerly received. Since they affect so many people, Spanish nationals, foreign residents and second homeowners alike, it is important to keep up to date with changes in the laws, and how they affect us.

On Friday July 1st Deputy Prime Minister, Alfredo Pérez Rubalcaba approved several measures aimed at improving the financial situation of mortgage holders. Under the new regulations, the personal income allowable to those involved in embargoes due to foreclosure proceedings increases from 700€ per month to 961€, plus an additional 192€ for each additional member of the household without income, thus creating a small but much-needed extra safety cushion.

MEP Diana Wallis, Vice-President of the EU Parliament, has worked hard to introduce legislation that will assist foreigners who have bought property in Spain. The new laws allow the purchasing procedure to be settled in the buyer's home country, where they will also be protected by that nation's legal system. This initiative has been set up by the European Land Registry Association and is being funded by the EU.

Piloted in Holland and Spain, the Cross Border Electronic Conveyancing (or CROBECO) project has enabled Dutch buyers to apply their own laws to the contract and apply to a Dutch court for compensation from the vendor, should it later be discovered that there are limitations on the property, such as retrospective planning laws. Pilot schemes involving other countries will be launched later in the year.

With the summer season fast approaching, the Agencia Tributaria (Spain's tax authority) is launching a campaign to cut down on illegal rental.

At its worst, this involves agencies that let properties on their books without informing the owners and then pocket the income, meaning that both the rightful recipient of the rental money and the tax authority are circumvented.

However, these new measures are also aimed at bringing to book the increasing number of second homeowners who are renting their properties out and failing to declare their earnings. Newly released figures estimate that, of the 65,000 holiday homes rented every year in Málaga province, 75 per cent are not declared, meaning a total loss to the taxman of a breathtaking €104.8 million.  

Spanish property owners are likely to find themselves with more money in their pockets, due to historic rulings by the courts in Seville and Leon, which upheld Legal Services Ausbanc's challenge to the reviled Clausula Suelo, or minimum clause. The latter prevents mortgage holders from benefiting fully from drops in the Euribor.

This minimum clause is among the small print written into many mortgage contracts, often without the knowledge of the holder. Its presence can have an extremely negative effect, since it holds the rate of repayments at an artificially high level and can make a big difference in your monthly mortgage repayments. Customers who have taken a mortgage at a rate of, for example, Euribor plus 1.5 points should be paying 2.5 per cent interest, but the inclusion of the minimum clause means that rates are often set from 3 per cent and upwards.

Although the past few decades have been marked by an influx of English-speaking retirees, these days new settlers are just as likely to be families hoping to make a new life for themselves. Many plucky young entrepreneurs arrive in Spain with the intention of finding a suitable commercial property ideal for conversion into their new business.

If you are considering starting a business you should of course do some research beforehand. Is there a demand for the product or service that you are offering? Would there be sufficient support for your business in terms of customers and supplies? Don't forget that what works well in the UK or Scandinavia might not be viable in Spain.

If you own an investment property the natural thing to do is to want to rent it out and make it work for you. Many homeowners who enter into the rental market however are not fully conversant with the commercial and legal framework underlying rental transactions. They approach the process as proud homeowners keen to earn some extra revenue in what they hope will be a relationship of mutual respect and benefit with the client.

Unfortunately it doesn’t always work out that way, as any businessperson will tell you from their own experiences of dealing with clients and suppliers. The majority of rental agreements are concluded satisfactorily, but a significant percentage falls prey to the many potential snags that can occur. These include poor maintenance or even outright damage to the property by tenants, unpaid bills and ultimately the need to evict troublesome occupants that are in danger of becoming squatters.

Such was the enthusiasm of holiday homebuyers during the Spanish property boom that many companies were able to cash in by offering homes off-plan. This initiative proved popular, since construction companies were able to draw up payment schedules that helped the purchaser to raise the funds in stages, meaning that the developers received regular injections of cash to finance completion of their projects.

When things went according to plan, this scenario worked well, enabling purchasers and builders to benefit from advantageous payment schemes. However, as Europe and the USA’s credit crisis worsened, some off-plan purchasers found themselves out of pocket, as incomplete projects meant that they were unable to sell or rent their property to cover their costs.

So what should you do if you find yourself in this position?

If you have accumulated two non paid receipts, you should talk to your Bank immediately with a view to negotiating with them the following:

• Setting a longer term to repay your mortgage and lower your payments.
• Granting a period of time where no mortgage payments need to be made
• Negotiating with your bank to pay interest only for 1 or 2 years
  

If none of these options work for you, you will have to consider giving the Property back to your Bank and in order to do this, you have to meet two conditions:

Good news is on the horizon for consumers who have suffered at the hands of Spanish banks, many of which have inserted a minimum-interest clause into clients’ mortgage agreements.

This practice is deemed illegal, meaning that customers are already organising class action suits to reclaim their sums that, in many cases, equal three months’ salary.

In November 2010 we obtained a favourable judgement in favour of our clients from the courts of Spain for a deposit that was paid for the construction of a property.

Renting your property in Spain out is an excellent way to contribute to the costs of owning a property in Spain.

That said one of biggest wories that we hear are from owners who are concerned that, if the tenant does not pay, they will be unable to evict the tenant and be left in the unfortunate situation of neither having use of the property nor any income from it.