Richardsons’ Guide to Buying Property in Gibraltar

1. Who Can Buy Property in Gibraltar?

• Open Market: Anyone (citizen or non-citizen) can buy on the open market.

• Restricted Market (“3-Year Residency” Properties): Some properties are only available to those who have lived in Gibraltar for a continuous period of 3 years.  These properties are typically more restricted - not suitable for letting, and must be occupied by the owner and/or immediate family.

• Buying through a Company: You can purchase in the name of a company (Gibraltar-registered or otherwise).  However, owning via a company doesn’t exempt you from tax - obtain expert advice.

Richardsons’ advice: We recommend evaluating whether you qualify for restricted properties early. If you don’t, your search should focus on the open market or structuring ownership via a company.

2. What to Consider Before You Start Your Property Search

Here are the key factors to think through - from a Richardsons perspective:

• Budget and Financing

  • Whether you’ll pay cash or take out a mortgage.

  • Which banks in Gibraltar you might work with; Richardsons can introduce you to trusted lenders.

• Type of Purchase

  • Off-plan vs resale

  • Buy-to-let vs primary residence

• Intention for the Property

  • Will you live here, rent out, or plan to resell?

• Location

  • Different areas in Gibraltar have different character, pricing, and amenities.

• Practical Considerations

  • Parking, access, leases, planning risk (future construction), pets, and more.

• Regulatory or Residency Constraints

Richardsons’ advice: We help you define your purchase “profile” - what kind of buyer you are - so you don’t waste time on properties that don’t match your goals.

3. The Purchasing Process: Step-by-Step

Here’s an overview of how a property purchase typically works in Gibraltar, with our notes on where Richardson’s expertise adds value:

1. Memorandum of Sale

   • Once an offer is accepted, a memorandum of sale is issued by the agent.  A small refundable 2% deposit reserves the property.

   • Richardsons will help negotiate, ensure deposit terms are clear, and protect your interests.

2. Pre-Contract Enquiries

   • Your lawyer will question the vendor’s lawyer on a variety of items: service charges, management companies, structural issues, alterations, water ingress, etc.

   • We coordinate with experienced local property lawyers to ensure nothing is overlooked.

3. Title Review & Contract Drafting

   • Verifying root of title, drafting contracts, setting exchange and completion dates.

   • Our legal partners or in-house counsel will guide this, emphasising clarity and protection.

4. Exchange of Contracts

   • At exchange, a further payment (usually 10% of purchase price) is made, and the deal becomes binding.

   • Richardson’s role: advising on timing, negotiating favourable terms, ensuring contractual safeguards.

5. Mortgage (if applicable)

   • If you’re financing, the purchaser’s lawyer or the bank’s lawyer drafts a Deed of Mortgage, interacts with the bank, reviews title, and arranges funds.

   • Richardsons can facilitate introductions to trustworthy Gibraltar-based banks, and help structure the financing.

6. Completion

   • A completion statement is prepared (apportioning rates, service charges, etc.).

   • On the day, deeds are signed, funds move from the buyer’s lawyer to the vendor’s lawyer, and titles transfer.

   • We ensure coordination between all parties for a smooth handover.

4. Conveyancing, Legal Title & Company Ownership

• Conveyancing Law: This is the legal transfer of property, and Gibraltar’s system is largely based on UK property law.

• Memorandum of Sale: Key document capturing buyer/seller details, price, and conditions.

• Ownership via Company: Buying through a company can be useful for structuring and tax - but it requires due diligence on the corporate structure.

Richardsons’ advice: If company ownership is under consideration, our corporate advisory team can help design the optimal structure and oversee all legalities.

5. Mortgages: What You Should Know

• Most mortgages for Gibraltar property come from local banks.

• It is possible to use non-Gibraltar lenders, but it's rare.

• Stamp Duty on Mortgages:

  • ≤ £200,000 → 0.13%

  • £200,000 → 0.20%

  • For mortgage releases: 0.03% of the original amount.

• Richardsons’ role: We can liaise with the bank, your lawyers, and coordinate the mortgage deed to align with your timeline and cash flow.

6. Stamp Duty & Other Buying Costs

• Stamp Duty on Property Purchase:

  • Up to £200,000 → 0%.

  • £200,001–£350,000 → 2% on first £250,000 + 5.5% on balance.

  • Over £350,000 → 3% on first £350,000 + 3.5% on the remainder.

• First / Second Time Buyers:

  • Exempt from stamp duty on properties up to £300,000 (note: excludes companies).

  • For properties between £300,001 and £350,000 → 5.5%.

  • Over £350,000 → 3.5% on balance (for qualifying buyers).

• Mortgage Stamp Duty: As above.

• Other Costs:

  • Registration cost at the Land Registry

  • Property searches, sealing fees

  • Management company / lessor approval fees (if relevant)

• Legal Fees: Legal fees are commonly around a few thousand pounds but can be more for more complex transactions.

Richardsons’ value-add: We clearly map out all expected costs for you, help you budget, and ensure no “hidden” fees surprise you at completion.

7. Taxes & Ongoing Considerations

• No Capital Gains Tax: Currently, Gibraltar does not impose capital gains tax on property sales (but see recent proposals — more below).

• No Inheritance Tax, No VAT: Makes Gibraltar very attractive for long-term ownership / generational planning.

• New Proposal: From August 2024, there is a proposed tax on gains for those owning 3 or more residential properties.

• Stamp Duty on Mortgage Releases: As previously covered.

• Land Registry Fees: E.g., £125 per deed to register in the Land Titles Register.

Richardsons’ approach: We monitor regulatory changes closely (like the proposed gains tax) and advise our clients proactively.  Our tax-advisory network helps you plan for both current rules and future scenarios.

8. Risks, Pitfalls & Due Diligence

• Leasehold vs Freehold: Most modern developments are long leasehold (e.g., 150 years minus a few days).

• Management / Service Charges: Critical to check with the vendor’s lawyer about service charges, management company structure, and any future liabilities.

• Restricted Properties: The three-year residency rule imposes use restrictions - not all buyers qualify.

• Financing Risks: Non-Gibraltar lenders are rare; local banks may have stricter criteria.

• Title Issues: Need for robust root-of-title checks; potential water ingress or structural problems.

• Future Legislation: Tax rules (e.g., on capital gains) might change.

Richardsons’ safeguard: Through our vetted legal and surveyor partners, we run thorough due diligence and risk assessments, and guide you in making informed decisions.

9. Why Work with Richardsons?

Here’s what makes us a strong partner for property buyers in Gibraltar:

• Local Expertise + Global Reach: We combine deep local market knowledge with international advisory capability.

• Holistic Service: From property search and negotiation to legal, financing, and post-completion support - we coordinate it all.

• Trusted Network: Established relationships with top Gibraltar lenders, lawyers, surveyors, and management companies.

• Client-Centered: We understand that every buyer has different goals (investment, relocation, residency), and we tailor our approach accordingly.

• Regulatory Insight: We stay on top of regulatory and tax changes (e.g., gains tax proposals) and proactively advise our clients.

Conclusion

Buying property in Gibraltar can be a rewarding process - thanks to its favorable tax regime, stable legal system, and dynamic real estate market.  But navigating it successfully requires a clear understanding of local rules, meticulous planning, and trusted advisors.  At Richardsons, we’re committed to being your partner from the first property search to final completion (and beyond).