Costs of Lawyer in Valencia and Malaga when buying a property

The general 1-2 % of the transaction

The cost of a lawyer’s fees to represent you in the purchase of property in Spain can vary depending on a number of factors, including:

• The experience and qualifications of the lawyer.
• The complexity of the transaction.
• The location of the property.

In general, lawyer fees in Spain are usually charged at a percentage of the value of the property, plus VAT. The percentage usually ranges between 1% and 2%, but can be higher in complex cases or high-value properties.

Why are lawyers’ fees calculated based on a percentage of the value of the property?

Don’t they charge by the hour?

The reason may be historically determined by the calculation of fees based on the official “Fee Scales” of the Spanish Bar Associations.

As we have seen in this article, the Bar Associations in Spain are distributed in judicial districts or by provinces. Historically, these institutions determined “minimum” fees that the lawyer had to charge for each service.

In the past, these scales were mandatory, but today their monitoring is completely voluntary, meaning that the lawyer is free to use the criteria established in these standards for his offer to the client.

The only exception to this “freedom of fee agreement” is established in the calculation of legal costs in the event of a judicial dispute. In these cases, these scales are usually used as references in the event of a judicial dispute. the exclusive effects of valuing that item (the fees) in the incidents of cost assessments or sworn accounts of lawyers.

Let’s see how a lawyer involved in a real estate transaction in different parts of Spain would quote, following the scales of each association or district:

Málaga

How much does it cost a Lawyer in Malaga for a property purchase assistance? 

 The Malaga Bar Association approved its own scales on September 18, 2006.

According to this scale, the different actions carried out by the lawyer are valued with a series of “points”, which accumulate as the process progresses.

Finally, the total number of points generated is multiplied by an amount that is updated each year, and which is approved by the Malaga Bar Association.

For the year 2023 the value of the officially approved point is 71,50 EUR (plus VAT 21%).

How it works in a purchase and sale transaction in Malaga:

• Simple consultations of less than one hour: 2 points = 143 EUR + VAT / hour
• Complicated consultations or consultations lasting more than an hour: 4 points = 286 EUR + VAT
• Telephone consultations: 1-2 points = 71,50 – 143 EUR / telephone call
• Written communications (emails): 3-6 points = 214,5 – 429 EUR + VAT/email
• Opinions, reports and reports: 10 points = 715 EUR + VAT / report
• Meetings with other lawyers: 3-5 points = 214,5 – 357,5 EUR + VAT/meeting
• Management (notary, registry, City Hall): 2 points = 143 EUR + VAT / Management
• Contract drafting:
  • Up to €30,000: 2% of the property value
  • Up to 60,000 EUR 1%
  • Up to €150,000: 0,7%
  • + EUR 300,000: 0,5%

This percentage is increased by 50% for complicated contractual transactions, such as:

• Language other than Spanish
• One of the parties to the contract being a foreign national

If in addition to “drafting” the contract, the lawyer “negotiates” its clauses until reaching an agreement, it increases by 100%.

Therefore, at a glance, without focusing on the consultations, opinions, meetings, etc. that may arise from a real estate sale, and focusing only on the service of preparing and negotiating a real estate purchase and sale contract.

Example

Let’s assume a case, a specific case of sale:

• 3 Complicated consultations with the client: 858 EUR + VAT
• 10 phone calls: 715 EUR + VAT
• 30 emails: 2.145 EUR + VAT
• 3 reports (one on the study of the property, another on the tax calculation, and another on the client’s civil and personal considerations): 2.145 EUR + VAT
• 5 procedures with a notary, 3 with the City Council and 3 with the property registry, and 2 for each change of water, electricity and IBI = 13 x 71,50 = 929,5 EUR + VAT

SUBTOTAL: 6.792 EUR + VAT

To this amount must be added the fees derived from the drafting and negotiation of the purchase and sale contract:

For a property of 500.000 EUR:

• Editorial: 0,5%
• Contract complexity + 50% = 0,75%
• Negotiation + 100% = 1,5%

SUBTOTAL: 1,5% x 500,000 EUR = 7.500 EUR + VAT

Therefore, according to the fee scale of the Malaga Bar Association, updated to 2023, if we add the actions prior and after the purchase and sale contract, to the fees derived from the drafting and negotiation of the purchase and sale contract, the result is:

6,792 + 7,500 = 14,292 EUR total fees for legal assistance in a real estate purchase and sale transaction in Malaga.

According to this calculation, the total fees accrued by the lawyer for this sale could be 3% of the value of the property.

This amount, which is the one officially calculated through the official scale of Malaga, is what justifies the quote that is usually offered by the province’s lawyers for advice on property purchase and sale transactions, and which ranges between 1 -3 % of the value of the property + VAT.

Valencia

Lawyer costs and fess for a property purchase in Valencia

The Valencia Bar Association approved its own scales on September 9, 2007.

These scales quantify the services of a lawyer in a real estate transaction based on the “value” or “amount” of the transaction. That is, the “price” agreed upon for the sale between buyer and seller. According to this value, percentages are applied on a scale, which are defined according to the functions or services entrusted to the Valencian lawyer.

In this way, based on the official scale and considering the phases and services that the lawyer would perform in a home or property purchase transaction in Valencia, we can make a simulation of the fees that would result from applying said scales.

• Departures, consultations, phone calls, communications: 60-200 EUR / share
• Drafting of complex contracts (contracts in which one of the parties is a foreigner, speaks another language, or that must be drafted in another language are considered complex): 50% of Scale I
• Notarial acts: 30% increase in fees derived from drafting the contract.
• Contract Negotiation: The above fees increased by 50%.
• If the amount of the contract is greater than 600,000 EUR. The amount of fees accrued up to now will be increased by the following percentages:
  • Up to €1,200,000, 25%.
  • From €1,200,001 to €1,800,000, 50%.
  • From €1,800,001 to €2,400,000, 75%.
  • More than €2,400,000, 100%.

Therefore, for an example of a real estate sale for an amount of 500,000 EUR, the fees according to the fee scale of the Valencia Bar Association would be as follows:

• 3 Complicated consultations with the client: 300 EUR + VAT
• 10 phone calls: 600 EUR + VAT
• 30 emails: 1.800 EUR + VAT
• 3 opinions (one for the study of the property, another for the tax calculation, and another for the client’s civil and personal considerations): 600 EUR + VAT
• 5 procedures with a notary, 3 with the City Council and 3 with the property registry, and 2 for each change of water, electricity and IBI = 13 x 100 = 1.300 EUR + VAT

SUBTOTAL: 4.600 EUR + VAT

To this amount must be added the fees derived from the drafting and negotiation of the purchase and sale contract:

• 50% of Scale I = 11.113 EUR + VAT
• Notarial acts + 30% = 3.333,9 EUR + VAT
• Contract negotiation: 5.556,5 EUR + VAT

SUBTOTAL: 20.003,4 EUR + VAT

Therefore, according to the fee scale of the Valencia Bar Association, if we add the actions prior and after the purchase and sale contract, to the fees derived from the drafting and negotiation of the purchase and sale contract, the result is:

4,600 + 20,003.4 = 24,603.4 EUR total fees for legal assistance in a real estate purchase and sale transaction in Valencia region.

According to this calculation, the total fees accrued by the lawyer for this sale could be 5% of the value of the property.

This amount, which is the one that is officially calculated through the official scale of Valencia, is the one that should be charged based on this document. However, the reality is that most qualified and registered solicitors quote brokerage quotes for advising on property purchase and sale transactions range between 1-3% of the property value + VAT.

Conclusion

Legal fees for buying property in Spain, particularly in regions like Valencia and Malaga,are often based on a percentage of the property’s value. These fees cover a broad range of services, from consultations and contract drafting to the handling of all necessary administrative and legal steps. While these fees might seem high, they reflect the comprehensive nature of the legal work involved in ensuring a smooth and legally compliant property transaction.

Given the potential costs, it’s crucial to carefully select your legal representation and fully understand the fee structure before proceeding with your property purchase. If possible, negotiate fees and get everything in writing to avoid any surprises.

TLACORP SLP