How to buy a property in CHILE
Any individual or corporate body may acquire and possess real estate in Chile whether or not they are residents. However, there are some restrictions regarding land located near the boundaries of the country. Chile has strong legal protection for property rights, including secured investments in real property.
All sale agreements should be notarized before registration. Failure to register a property transfer makes the contract void. The whole process of registering a property can be completed in around 20 to 41 days.
A lawyer is contracted usually to conduct due diligence of the property’s legal history. He is also responsible for obtaining copies of the property titles, the Certificado de Vigencia and the Encumbrance certificate (Certificado de Hipotecas y GravÃ¡manes y de Interdicciones y Prohibiciones de Enajar). After which, he obtains an evidence of complete payment of land tax from the Treasury (Servicios de TesorerÃas) from the Servicio de Impuestos Internos.
The sale of real estate is not subject to VAT, with the exception of the first sale of homes built by a construction company, which is subject to VAT at 18%. There are a number of fees you need to be aware of when purchasing real estate.
As a buyer, you can expect to pay between 2% and 3% of the purchase price which is payable when the agreement becomes unconditional.
Lawyer’s fees are around 1% of the property value.
Stamp duty is levied at around 0.20% to 0.30%, depending on the location of the property. Stamp duty is levied at 0.20% in the cities of Santiago, Valparaíso and Viña del Mar. Stamp duty is levied at 0.30% in other cities.
Notary fees are generally around 0.10% of the property value.
Buying real estate in Chile: Purchasing procedure
Buying real estate in Chile is a fairly straightforward process, even if you are not a citizen. With proper planning and a good bi-lingual attorney (unless you are fluent in Spanish), buying your home here can be a hassle-free process.
Here’s what you will need in order to purchase a home or land in Chile:
- The formalized contract (escritura pública otorgada ante Notario and Escritura Pública). These two are lumped together because the contract is usually part of the Escritura Pública.
- The title report for the property (Estudio de Títulos).
- A RUT (Rol Único Tributario) if you are a non-citizen non-resident, or a RUN (Rol Único Nacional) if you are a Chilean citizen or resident of Chile. The RUN is the equivalent to a Social Security number and the RUT is a number used to keep track of foreigners’ for tax purposes.
Buying restrictions in Chile
For the most part, the Chilean constitution guarantees foreigners the same rights as Chilean citizens when buying and selling real estate. There are certain exceptions such as in the case of national security areas (ie close to national borders). It is best to ask a real estate attorney for more details.
Contact the Gateway to South America team to learn about the best investment opportunities in the region. The company is a benchmark for foreign investors wishing to invest in Argentina, Brazil, Chile, Paraguay, Peru and Uruguay, providing expert advice on property acquisition and investment tours.