How Do I Buy a Property in Spain? Expat Guide
Spain has always been a popular expat destination, with its sunny weather, relaxed lifestyle, and stunning scenery. Whether you’re retiring to the Costa del Sol, seeking a holiday home in Mallorca, or moving to Barcelona for a job opportunity, buying property in Spain can be an exciting venture.
However, buying a home in Spain also involves navigating legal, financial, and cultural nuances that might be unfamiliar to non-residents. Here’s a comprehensive guide to help expatriates understand the steps to purchasing property in Spain.
Understanding the Spanish property market
It’s essential to research the Spanish property market. Prices and demand can vary greatly depending on location.
- Coastal areas like Marbella and Alicante are popular among retirees and holidaymakers, leading to higher property prices
- Cities like Madrid and Barcelona have competitive markets due to their appeal for professionals and students
- Rural areas or smaller towns offer more affordable options but may lack amenities
Set your budget and assess costs
The property price is only part of the financial equation when buying a property in Spain. Expats should also factor in the additional costs, which typically range between 10% to 15% of the purchase price and are broken down as follows:
- Property transfer tax (ITP): 6%-10% depending on the region
- Notary fees: Approximately €800 – €1,500
- Registry fees: Around 0.5% – 1% of the purchase price
- Legal fees: 1% – 2% of the property price
- Mortgage arrangement fees: Usually 1% – 1.5% of the loan amount
As of August 2024 the average price of a property in Spain is €637,448.Taking the lower end of the additional costs above, expats could look to pay around an extra €54,983.08 on a property of this value.
| Additional Cost | Amount |
| ITP (6%) | €38,246.88 |
| Notary fees €800 | €800 |
| Registry fees (0.5%) | €3,187.24 |
| Legal fees (1%) | €6,374.48 |
| Mortgage arrangement fees (1%) | €6,374.48 |
Types of Spanish property
Spain offers a wide variety of properties, from new-build apartments to rustic farmhouses, known as fincas. Expats will have a choice of:
- New builds: These often come with warranties and modern amenities but may have a premium price.
- Resale properties: Often more affordable but may require renovation.
- Rural properties: Be aware of local planning restrictions and infrastructure challenges.
Legal requirements for expats buying property in Spain
Obtain an NIE number
The Número de Identificación de Extranjero (NIE) is a tax identification number required for any financial activity in Spain, including buying property. You can apply for an NIE in Spain through or a local police station. It can also be applied for by visiting the Spanish embassy in your home country.
Check residency rules
Brexit had a big impact on visa requirements for non-EU nations. The Golden Visa scheme may be a viable option for expats who want to invest at least €500,000 in property. This visa also grants residency status.
Work with trusted professionals
Real estate agent
Choose a licensed real estate agent who is familiar with expat clients and knows the local market well. They will be able to help you navigate language barriers and the entire process to Spanish home ownership.
Lawyer (Abogado)
Hiring an independent lawyer is critical to ensure that the property is free of legal issues, such as outstanding debts or illegal extensions. Your lawyer will review contracts, confirm the legitimacy of ownership, and handle necessary filings. In larger areas there will be English speaking property lawyers who work with expat clients.
Notary (Notario)
In Spain, property sales must be finalised in front of a notary – a professional witness. They ensure the transaction complies with Spanish law and officially record the sale.
Steps to buying property in Spain
Step 1: Find the right property
Browse listings online or visit properties in person. Estate agents often provide virtual tours for remote buyers.
Step 2: Make an offer
Once you’ve found the right property, make an offer through your real estate agent. Negotiation is common, so be prepared for some back and forth. Your agent will be able to handle any language barriers.
Step 3: Sign a reservation agreement
To secure the property, you’ll sign a reservation agreement and pay a deposit. This takes the property off the market while due diligence is performed.
Step 4: Conduct due diligence
Your lawyer will verify that the property is free of debts or encumbrances, confirm planning permissions, and review the title deed (escritura).
Step 5: Sign the sales contract (Contrato de Compraventa)
Once due diligence is complete, a private sales contract is signed, and a further deposit (usually 10% of the property price) is paid. The contract will outline the terms, including the completion date.
Step 6: Completion day
On completion day, both parties meet at the notary’s office to sign the public deed of sale. The buyer pays the remaining balance, including taxes and fees, and the notary registers the property in the buyer’s name.
Financing your Spanish property
Expats can apply for Spanish mortgages, though banks typically lend 60% – 70% of the property value to non-residents. This means you may need to pay a larger deposit compared to your home country. Be prepared to provide:
- Proof of income and employment
- Bank statements
- Credit history
Consider currency exchange rates if your income is in a currency other than euros, as fluctuations can impact repayments.
Tax implications
As a property owner in Spain, you’ll face several taxes:
- Property Tax (IBI): An annual municipal tax based on the property’s cadastral value
- Non-Resident Income Tax: Even if you don’t rent out the property, non-residents must pay a deemed income tax on its potential rental value
- Wealth Tax: Applicable for high-value properties
You can consult with a tax advisor to understand your obligations and minimise liabilities.
Cultural and practical considerations
Language barriers
While many professionals speak English in popular expat areas, learning basic Spanish will help in dealing with utilities, local authorities, and neighbours.
Bank account
Opening a Spanish bank account simplifies transactions, from paying taxes to setting up utility bills.
Community fees
If you buy property in a shared complex, such as an apartment block, you’ll need to contribute to community fees for maintenance and amenities.
Common pitfalls to avoid when buying in Spain
- Skipping legal advice: Never sign documents or pay deposits without consulting your lawyer.
- Unclear property boundaries: Especially important for rural properties.
- Assuming verbal agreements are binding: Only written contracts hold legal weight in Spain.
- Ignoring planning regulations: Unauthorised extensions or renovations can lead to fines or demolition orders.
Benefits of buying a property in Spain
Owning property in Spain not only provides a potential financial investment but also opens the door to enjoying the country’s high quality of life. From the Mediterranean climate to world-class cuisine, vibrant festivals, and a slower pace of living, Spain is an ideal place for expats seeking adventure and relaxation.
Buying property in Spain as an expat may seem daunting at first, but with careful planning, the right professionals, and an understanding of the process, it can be a rewarding experience. Whether you’re looking for a permanent residence or a vacation home, Spain offers diverse options to suit every lifestyle. Take the time to familiarise yourself with the market, legalities, and cultural nuances, and you’ll soon find yourself living your dream under the Spanish sun.
