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Does anyone have first hand experience in the tax system regarding property in Spain, or Italy? While not quite there, less than ten years away, my wife and I are in the initial phases of looking of where we might want to retire to. I love Italy, but my wife loves Spain, so I'm trying to get at least a ball park figure if one were to purchase a home there. Any information/comments are welcomed. Thank you.
4 words: Stay.away.from.Italy.
Especially if you fear terrible bureaucracy, if you retire with millions or many hundreds of thousands of dollars/euros then you can think of retiring here though.
Does anyone have first hand experience in the tax system regarding property in Spain, or Italy? While not quite there, less than ten years away, my wife and I are in the initial phases of looking of where we might want to retire to. I love Italy, but my wife loves Spain, so I'm trying to get at least a ball park figure if one were to purchase a home there. Any information/comments are welcomed. Thank you.
Where are you retiring from? I have a condo in Puerto Banus, Spain but recently bought it so haven't files taxes on it yet. In general, the property tax is much lower than what we are accustomed to in the USA and if you are British, the Council Tax I believe would be much higher.
If you live in Spain, you will have to pay income taxes on your income and the rates are much higher than USA rates and also higher than UK income tax rates. I looked into retiring in Spain and as a resident of the USA, I can do it provided my property or combination of property is bought for a minimum of $500K Euro. If you're British, much easier for you to retire there. The actual cost of living in Spain is very low even in a gorgeous resort like Puerto Banus, it's much cheaper to live than comparable communities in Florida and California is another level more expensive.
In general, I believe Italy would be more expensive than Spain. After time spent in both, I much prefer Spain.
Tall Traveler, I would be retiring from the US. About a year ago I tried to see what the costs were as it related to income (this post was about real estate). I did not record anything, now I wish I did, but what I discovered is that our tax rate would have been somewhere in the high 40s, or about 50%! We are not close to that here in the US, but we know how to reduce our tax liability here, I've no clue about Italy, or Spain.
We would also be leaning towards Spain, we both are fluent in Spanish. I'm familiar with the location, but have not been to Puerto Banus. I am very familiar with Sitges, Castelldefels, Garraf, etc. as my wife and I have travel there every other year since the mid 90's. Our kids really loved Sitges too, but it way too expensive for us to live there.
I wonder what, if any, advantages someone from an EEA (European Economic Area) country would have in retiring and owning a home in Spain?
OP, Read the following articles and then ask yourselves if you really want to buy a home in Spain. Read the comments too, such as "who in their right mind would buy a home in Spain".
The EU is a joke. They have problems recognizing property rights, which by the way, is happening all over the US. Think about Florida or Texas as they seem to recognize property rights better than other bastions of communism within the US, such as Baltimore or Detroit. We will all be speaking Spanish soon here anyway.
The Daily Mail is not a reliable news source. It is notorious for reporting half a story in order to make a sensation of it. You should not believe anything it says without corroboration.
The Daily Mail is not a reliable news source. It is notorious for reporting half a story in order to make a sensation of it. You should not believe anything it says without corroboration.
Yes, the Daily Mail has poor writing, many spelling errors, no proofreading, and so called "journalists" who are clueless when it comes to geography. However, that doesn't mean that these events didn't happen. Here are three more articles from respectable publications mentioning the same. Maybe you will believe these.
Property taxes are the least of one's worries in most Mediterranean countries; financially it will amount to a relative pittance.
Not too long ago a poster offered here a similar horror story in Italy: unending litigation due to problems with the legality of the property sold to the unsuspecting foreigner.
People, what is this mania for buying, especially in a foreign country?
Besides the legal pitfalls, do the financial calculations carefully. In many cases, it may be legally safer and financially more astute to invest one's principal in income-producing securities in a country with wide and deep financial markets and rent in a Mediterranean country or similar region rife with corruption, dodgy legal systems, lethargic economies, and relatively retarded financial markets.
If it's too good to be true, it probably is.
At the very least, rent for two years, at least, and maybe five, during which time learn the language, the real estate market, the laws governing it, whom you can trust, if anyone, and then, if you haven't already ruined your retirement years with all that stress, think twice again about buying.
People, what is this mania for buying, especially in a foreign country?
Besides the legal pitfalls, do the financial calculations carefully. In many cases, it may be legally safer and financially more astute to invest one's principal in income-producing securities in a country with wide and deep financial markets and rent in a Mediterranean country or similar region rife with corruption, dodgy legal systems, lethargic economies, and relatively retarded financial markets.
If it's too good to be true, it probably is.
At the very least, rent for two years, at least, and maybe five, during which time learn the language, the real estate market, the laws governing it, whom you can trust, if anyone, and then, if you haven't already ruined your retirement years with all that stress, think twice again about buying.
Good Luck!
Finally, some words of wisdom. For any person(s) thinking of moving to another country where they have never lived before, and especially if they are also not fluent in the local language, why rush to buy real estate?
In many countries, you can find comfortable rental units that are outside of the major tourist areas for very affordable prices. Small house, condo / apartment, whatever you are looking to rent can be found without a huge amount of difficulty. Then you can spend a year or two getting accustomed to the new area, and who knows, you might find another place that you like better! That's no problem, because as a renter it is not a big deal to move at the end of your lease.
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