The system of property ownership in Gibraltar is very similar to the United Kingdom. Titles to properties are registered with the Supreme Court of Gibraltar. Purchasers buying directly from a developer are usually granted a fixed-term lease, with subsequent buyers being granted an assignment of the number of years left.
There are no restrictions on property ownership by an individual in Gibraltar. Owning a property in the name of a Gibraltar Offshore Company is not essential, though it does offer certain tax advantages.
The first step to owning a property in Gibraltar is viewing the property and negotiating a price, and drawing up a pre-contract. The contract simply reserves the property, and does not legally bind either party to the sale. A reservation fee of 2% is usually paid on the contract, which is held in escrow.
With the reservation contract signed, the purchaser must now organise financing. Along with a mortgage (if required), the purchaser must also take additional fees into account:
- Stamp Duty is paid at 1.26% on the property involved, plus an additional 0.13% on any mortgage.
- Deed registration is the cost for registering the Deed with Gibraltar´s Supreme Court and the Land Titles Registry. These fees usually don´t apply to any more than £100 sterling.
- Legal Fees – these vary depending on your lawyer.
While the buyer is arranging financing, the seller´s lawyer should be drawing up the first draft of the contract, to be revised as necessary until the terms are agreed upon.
When the contract is agreed upon and signed, 8% of the property price will be added to the 2% already in escrow to make a down payment. At this point, both parties are committed to the sale.
Bear in mind that Gibraltar claims to have more lawyers per capita than anywhere else in the world, so finding one to help with your purchase shouldn´t be a problem. A local lawyer will help ensure your interests are protected at all stages of the property purchase.