How To Buy A Property In Spain >> Step-by-Step 2024 Guide

We know how to buy a property in Spain – from personal experience. Many foreigners dream of a Spanish home, especially owning their own place in this beautiful, sunny country. Whether it is a permanent home, a holiday home, or an investment, it is an exciting proposition.

In this guide, we will examine the pros and cons of owning property in Spain and the pitfalls to avoid. We’ll also take you from starting your property search to completing the purchase. Read on for your guide to how to buy a property in Spain.

Understanding the Spanish Property Market

Spain has a relatively high rate of owner-occupied properties (76%) compared to the US and the UK (both 65%) and the EU average (70%). This is driven by cultural preferences and historical factors. However, the rental market has been growing, particularly in urban areas, due to economic factors and a younger demographic opting for rental properties.

Prior to the 2008 global financial crisis, Spain saw a significant rise in property prices, with some areas experiencing increases of as much as 250% over ten years. However, when the crisis hit, prices dropped by around 40% from 2007 to 2015.

Since then, property prices have steadily recovered, particularly in major cities like Madrid and Barcelona — largely driven by foreign investment, a strong tourism sector, and a growing economy.

But despite this recovery, prices remain below their pre-crisis peak, offering potential opportunities for investors.  Furthermore,  the recovery has been uneven, with some regions experiencing more growth than others.

Spain is Different

As is the case with many aspects, Spain is different when it comes to the property market.

The role of real estate agents (inmobiliarias) differs from that in the US and UK. Unlike in the US and UK, where agents typically represent either the buyer or the seller, in Spain, agents can act on behalf of both parties. This means a single agent may be involved in a transaction.

And fees are significantly different. Where the US or UK seller typically pays the agent’s commission, in Spain, buyers might also be expected to pay a fee, usually ranging from 2% to 5% of the selling price. This significantly impacts the overall purchase costs.

Another difference arises on the legal side. In Spain, the process requires a notary public to verify the legality of the transaction and transfer of ownership. This contrasts with the UK, where solicitors handle the legal aspects.

With tax, where the UK has stamp duty, Spain imposes a transfer tax that ranges from 7% to 10% of the purchase price, depending on whether the property is a resale or a new build.

Buying a Property in Spain as a Foreigner

Buying real estate in Spain as a foreigner is a relatively straightforward process. However, here are the steps you need to take.

NIE

First, apply for your Spanish tax identification number (NIE). You cannot purchase real estate in Spain without this. An immigration lawyer can assist, as this process can be tricky. Check out our guide for more information.

Research

Thoroughly research the property market in the area or areas you are interested in. When you have found a property you want, research it thoroughly. This includes checking its legal status, ownership, and potential debts or liens. Speak to residents in the area or use forums like Facebook to check for insider information.

Tips for researching your property in Spain before you sign the arras contract (see below):

• Hire a Qualified Professional: It’s essential to have the inspection conducted by a certified and experienced property inspector. These experts possess the skills and equipment necessary to detect structural issues, installation problems, dampness, and more.
• Request a Detailed Report: After the inspection, the inspector should deliver a thorough report that includes all findings, with photographs, descriptions, and recommendations for addressing any identified issues.
• Estimate Costs: If any problems are discovered, it is wise to obtain repair estimates. This information can assist the buyer in negotiating the final property price or deciding whether to proceed with the purchase.

Lawyer

At this stage, it is advisable to hire a lawyer familiar with Spanish property law. They can guide you through the process and ensure you meet all legal requirements.

Tip: If your Spanish is not adequate, find a lawyer who speaks English. The process is too complex to rely on Google Translate. Finer details of contracts can easily get lost in translation, and misunderstandings can be costly.

Offer

When you are satisfied with the property, make an offer through the estate agent. Once you and the seller agree, you must sign a preliminary contract and pay a deposit.

Offer Step 1 > Reservation Agreement

Once you make your offer and it is accepted, the Estate Agent can ask you to pay up to 1% and may have a pre-filled form that they demand you sign on the spot.

Tip: If you want to try your luck, there is no harm in making an offer below market value. The estate agent is bound to at least deliver your offer (even if they advise rejection.) But this can impact future negotiations, so take care if this is your dream house in Spain!

Offer Step 2 > Downpayment Contract (Contrato de Arras)

The second stage requires a 10% down payment, which is forfeited if the sale doesn’t go through. If the seller retracts after you pay the arras, they may have to repay twice the deposit amount. This is managed by Article 1454 of the Spanish Civil Code.

Some standard Contrato de Arras terms include:

• Property Description: Ensure the contract includes a detailed description of the property, such as its location, square footage, type of dwelling, and other relevant characteristics.
• Total Sale Price: The contract must clearly state the agreed total price of the property, excluding the deposit.
• Completion Date: Set a deadline for completing the sale, including signing the public deed and paying the remaining balance.
• Penalties: Specify the repercussions if either party backs out. If the buyer withdraws, they lose the deposit; if the seller withdraws, they must return double the deposit amount.
• Possible Deductions: Detail any costs the seller has agreed to cover (e.g., repairs or improvements) and how these will be deducted from the total sale price.
• Specific Stipulations: Include any particular conditions related to the property, such as the inclusion of furniture or required repairs before the sale.
• Required Documentation: List the documents the seller must provide, like certificates proving the property is debt-free, up-to-date with taxes, and energy classification certificates.
• Transaction Costs: Outline how transaction-related costs, such as taxes, notary fees, and registration expenses, will be allocated.

Purchase

The final step is to complete the purchase by signing the deed of sale. At this point, you’ll pay the remaining balance and any associated taxes and fees. This is usually done before a notary public.

Need a mortgage? Please read our guide to obtaining a mortgage in Spain.

What are the Costs When Buying Property in Spain?

When buying property in Spain, there are several costs and fees to be aware of. Many of these vary depending on the region. As a rule of thumb, expect the buying costs to be between 13% and 15% of the property price.

Property Transfer Tax (Impuesto sobre Transmisiones Patrimoniales (ITP))

This tax applies to the purchase of a resale property and varies depending on the region. ITP ranges from 6% to 11% of the purchase price in most areas. ITP is paid to the tax authority of the autonomous community (comunidad autónoma) where the property is located.

Value Added Tax (IVA)

VAT applies to purchasing a newly built property. It is 10% of the purchase price.

Capital Gains Tax

If you are selling a house in Spain for a profit, you may be liable for capital gains tax. You may have to pay this amount in Spain or your home country, depending on your tax status. Check out our guide to tax in Spain for more information.

Notary Fees

Notary fees for the legal transfer of ownership can range from 0.1% to 1% of the purchase price when buying a property.

Registry Fees

These are charged for registering the property in the Land Registry. These can range from 0.1% to 1% of the purchase price.

Legal Fees

Legal fees for a property purchase can range from 1% to 2% of the property purchase price. This includes the cost of hiring a lawyer to review the sales contract and handle the legal process.

Mortgage Costs

If you require a mortgage to purchase the property, you will incur additional costs, such as appraisal fees, mortgage setup fees, and bank charges.

Find out how to get a Mortgage in Spain and how to open a Spanish bank account.

Building Insurance Policy

When you purchase a property, you should take out at least a building insurance policy to cover damage, including fire. Depending on your mortgage type, many Spanish banks insist on a specific insured amount and policy type. Many homeowners in Spain also choose contents insurance to cover their possessions. See our Spain insurance guide here for more information.

10 Pitfalls to Avoid When Buying Property in Spain

While buying Spanish real estate can be an exciting and rewarding experience, there are some potential pitfalls to be aware of. Here are some of the most common:

1. Property Status

• Reason: The Spanish market can lack transparency. Information about the property’s condition, history, and legal status may not always be clear.
• Tip: Ensure thorough checks on the property’s legal status and work with reputable professionals to uncover any hidden issues. This should include an up-to-date “Nota Simple” from Spain’s Land Registry.

2. Legalities of Local Planning Compliance (Licencia de Primera Ocupación)

• Reason: Properties must comply with local urban planning regulations. Failing to do so can result in hefty fines or even demolition.
• Tip: Ensure the property has a valid Licencia de Primera Ocupación, certifying that the building meets all local regulations, especially for properties that have undergone renovations.

3. Legal Issues

• Reason: These can include incomplete or incorrect paperwork, zoning, and planning issues, and disputes over ownership or boundaries.
• Tip: Do thorough due diligence and work with reputable professionals, such as lawyers and real estate agents, to navigate and resolve these issues.

4. Community Debts (Deudas con la Comunidad)

• Reason: When you buy an apartment or a house in a complex, you may inherit any outstanding debts the previous owner had with the homeowners’ association.
• Tip: Request a Certificado de Comunidad from the seller, confirming there are no outstanding debts. The community president or administrator should provide this document.

5. Coastal Law Restrictions (Ley de Costas)

• Reason: The Coastal Law protects public access to Spain’s beaches and can affect properties located near the coast, including restrictions on building and renovations.
• Tip: Verify if the property is affected by the Ley de Costas. Properties within a certain distance from the shoreline may have usage restrictions or could be subject to expropriation.

6. Property Registration Status (Registro de la Propiedad)

• Reason: Not all properties in Spain are correctly registered or might have discrepancies in the Land Registry.
• Tip: Obtain a Nota Simple from the Registro de la Propiedad. This document provides information on the legal status of the property, including ownership, liens, and any encumbrances.

7. Additional Costs

• Reason: Many other costs arise in addition to the purchase price. These include taxes, legal, notary, and property transfer fees, which can quickly add up and significantly increase the overall cost of the purchase.
• Tip: Budget in advance for these additional costs. Also, consider currency fluctuations if you are buying from abroad, and understand your Spanish tax liabilities.

8. Estate Agent Exclusivity and Fees

• Reason: When viewing a property with an estate agent, they may ask you to sign paperwork to lock you into using only them or commit you to pay a percentage if you buy the property.
• Tip: Do not sign anything without consulting a lawyer. Often, there is no benefit for you, only for the estate agent.

9. Off-Plan Purchase Risks (Compra sobre Plano)

• Reason: Buying property off-plan can be risky if the developer fails to complete the project or meet deadlines.
• Tip: Ensure the developer has a bank guarantee or insurance policy to cover your payments in case the project isn’t completed. Research the developer’s track record and visit other projects they’ve completed.

10. Property Scams

• Reason: Property scams are common in Spain, particularly targeting foreign buyers. Scammers may offer properties that do not exist, misrepresent the condition or legal status of a property, or offer properties at unrealistically low prices.
• Tip: Be cautious and skeptical. If a deal seems too good to be true, it probably is. Always verify the legitimacy of the property and the seller through reliable channels.

Finding The Perfect Property In Spain

There are some excellent online property platforms that bring together properties from most estate agents across Spain. Expats and locals alike favor two in particular:

• Idealista.com
• Habitaclia.com

With both, you can filter your search by price, size, number of bedrooms, location, etc. This is particularly helpful since many properties are listed by more than one agent.

Once you have your shortlist, book your viewing appointments with the estate agents you want to work with.

Tip: Work with several real estate agents in the area and let them know you are not a “captive client.” A little competition for your attention and business is a good thing.

It is also worth building relationships with local real estate agents by calling or visiting their offices. This way, you may get advance notice of a property that is about to come onto the market or is off-book. Developing these one-to-one relationships with agents can pay off.

How To Buy a Holiday Home in Spain

Buying a holiday home in Spain is like buying any other property there. However, it is wise to consider some additional factors before purchasing.

If you want to lease your property as a holiday home when you are not using it, check if you need a license. Some areas have closed their books on new permits, so you may not be able to offer a holiday let. And the fines for renting out unlicensed premises can be horrendous. In Barcelona, for example, you could be fined tens of thousands of euros.

Warning: Some unscrupulous vendors may suggest they have a tourist license when they do not. Make sure your lawyer verifies the documentation before you pay a deposit.

Consider hiring a property management company to handle your rental process and maintenance. If you proceed, it is worth researching local companies, their service levels, and fees.

Important Note: It is essential that the property is a good “lock up and leave”. You need to be aware of the laws around squatting in Spain. Evicting squatters (illegal tenants, okupas) can be challenging once they have taken residence. Your empty property must be protected when you are away for long periods to avoid these issues.

Pros & Cons of Buying a House in Spain Versus an Apartment

	Pros	Cons
House	– More space than apartments – More rooms, outdoor areas, and gardens – May provide more privacy as often located in secluded areas and suburbs – More flexibility to customize  — add a pool, extend, etc – Generally, you own the freehold and don’t pay communal service charges or repairs	– Usually more expensive to purchase and maintain – May be more difficult to secure if you leave the property empty for long periods – Have to pay all maintenance and upkeep rather than share them communally
Apartment	– Shared walls and common areas with other residents can lead to less privacy and more noise – Often have restrictions on customization, such as limits on painting or renovations – Some apartment builders cut corners on insulation and soundproofing	– Shared walls and common areas with other residents can lead to less privacy and more noise – Often have restrictions on customization, such as limits on painting or renovations – Some apartment builders cut corners on insulation and soundproofing

Wherever and whatever you buy, try to inspect the place to verify how peaceful your new home will be. We speak from first-hand experience — our dream beach-view home turned into a nightmare when we could literally hear the neighbors talking through the walls!

Our Insider Tips on Inspecting a Property in Spain

Visit at Different Times of Day:

• Reason: The neighborhood and the house itself can feel very different depending on the time of day. For example, a quiet street during the day might be noisy at night.
• Tip: Visit the property in the morning, afternoon, and evening. Pay attention to noise levels, traffic, and the amount of natural light entering the home at different times.

Check for Signs of Moisture and Water Damage:

• Reason: Moisture can lead to mold, structural damage, and other costly repairs.
• Tip: Look for water stains on ceilings and walls, check for musty odors, and inspect the basement or crawl spaces for dampness or standing water.

Examine the Condition of Windows and Doors:

• Reason: Windows and doors are critical for energy efficiency and security.
• Tip: Check for drafts, difficulty opening or closing, and signs of condensation between double-glazed windows. Also, ensure that locks and hinges are in good working order.

Assess the Electrical System:

• Reason: An outdated or faulty electrical system can be a significant safety hazard and expensive to update.
• Tip: Check the age and condition of the electrical panel, outlets, and wiring. Look for exposed wires, flickering lights, or circuits that trip frequently. You might also consider having a professional electrician inspect it.

Investigate the Neighborhood and Local Amenities:

• Reason: The surrounding area can significantly impact your quality of life and property value.
• Tip: Spend time walking around the neighborhood. Talk to neighbors about the area and check the proximity to schools, hospitals, public transportation, parks, and shopping centers. Look for signs of neighborhood upkeep, such as well-maintained lawns and public spaces.

What is “Rent-to-Own” in Spain

Rent-to-own, or rent-to-buy, is an agreement in which a tenant rents a property with an option to purchase it in the future. This is known as ‘alquiler con opción a compra’.

Under a rent-to-own agreement, the tenant pays the landlord a monthly rent. This may include an additional fee that goes toward the eventual purchase price of the property. The tenant also has the option to purchase the property at a predetermined price within a specified time frame—typically one to five years.

Rent-to-own agreements in Spain can benefit both the tenant and the landlord. For the landlord, they offer a steady income stream from the rent and the potential for a subsequent sale. For the tenant, they provide the opportunity to try out a property before committing to a purchase. They also allow time to accumulate savings towards the down payment.

However, there are also drawbacks for both parties:

• The tenant may pay more for the property than its market value
• They may lose the option to purchase if they cannot secure financing or meet other terms of the agreement
• The landlord risks default or other complications if the tenant cannot complete the purchase

Both parties must carefully review the terms of the rent-to-own agreement, as they can be complex. We strongly advise seeking professional advice before entering this type of arrangement.

Rent-to-own agreements were prevalent after the 2008 credit crisis but are less common now that the property market has recovered.

Buying a House in Spain After Brexit

Following the UK’s withdrawal from the EU, British citizens are now subject to new regulations regarding buying real estate in Spain. Here are some key points to keep in mind.

• The 90/180 Day Rule
  British citizens staying in Spain for over 90 days in any 180-day period must apply for a visa or residency permit
• The type of permit required depends on the individual’s circumstances, such as whether they plan to work or retire in Spain
• You can still buy a property without restrictions, but you may be limited in how much time you can spend in your house
• See our Spain visa section to learn more about immigration options for UK Citizens After Brexit

To learn more about buying real estate after Brexit, seek professional advice to ensure a smooth and successful purchase process.

Note: EU and EEA citizens can live in Spain as long as they register, regardless of whether they own property.

Buying Off-Plan Property in Spain

Buying off-plan in Spain refers to purchasing a property before completion, typically during construction. This option can be attractive for buyers who want to secure a property at a lower price. A bonus is that you have more control over the final design and finishes.

However, there are some risks involved with buying off-plan. It is vital to thoroughly research the developer, their track record, location, and local market conditions. Buyers should also carefully review the contract and understand their rights and obligations. You should look closely at payment schedules and any penalties for delays or changes to the property.

Work with a reputable real estate agent to protect your investment, and hire an independent lawyer to review the contract and advise you. Additionally, it is crucial to ensure that the developer has adequate insurance and guarantees in place. These should cover any potential issues that may arise during the construction process.

Is it a Good Idea to Invest in Property in Spain?

Investing in property in Spain can be a good idea for many reasons. It will depend on various factors, such as your investment goals and the current state of the Spanish property market.

Spain is a popular tourist destination, which means there is a strong demand for rental properties, particularly in coastal areas and major cities. This demand ensures a potential source of rental income for investors.

The Spanish real estate market has experienced periods of solid capital growth. While there have been some fluctuations in recent years, there is still potential for long-term capital growth.

However, there are also potential downsides and risks to consider. These risks include the potential for currency fluctuations, hidden costs, legal issues, and changes to laws and regulations.

If you are considering investing in Spanish property, especially for the purpose of letting it out to tourists, it’s essential to approach this decision with careful planning and awareness of the current socio-political climate.

Research Local Regulations
Understand Zoning Laws and Restrictions. Different regions in Spain have varying regulations regarding short-term rentals. Cities like Barcelona and Madrid have stringent rules to control the number of tourist accommodations. Ensure you fully understand these laws to avoid legal complications.

Obtain Necessary Licenses
To legally rent out your property to tourists, you often need a tourist rental license. These can be difficult to obtain in certain areas, and the process may involve strict compliance with safety and quality standards.

Monitor the Political Climate
Given recent anti-tourism protests there may be new regulations or policy changes planned to curb foreign ownership of rental properties. Keep an eye on local news and updates from municipal governments.

Engage with Local Communities
Be mindful of the impact your investment has on the local housing market and community. High levels of tourist rentals have driven up property prices and reduced availability for local residents, contributing to the recent protests. Building good relationships with local residents can ease tensions and make you more welcome.

Evaluate Economic Viability
Assess the economic implications of potential regulations on your rental income. Higher taxes, fees, or limitations on rental periods can impact your return on investment.

Consider Long-term Rentals
If feasible, consider offering long-term rentals instead of short-term tourist accommodation. This can provide a stable income and is often viewed more favorably by local communities.

Finally, always work with a reputable Spanish real estate agent who understands the local market dynamics and can advise on the best investment strategies. Consult with a Spanish lawyer and consider partnering with a local property management company to handle the day-to-day operations of your investment property.

Owning a Rental Property in Spain

Renting out a property in Spain can be a lucrative investment. But it is vital to consider some disadvantages of being a landlord in Spain. Tenant protection laws are relatively strong, and evicting tenants can be more difficult compared to the USA and UK. Here are some of the critical differences in tenant rights and eviction procedures between Spain, the USA, and the UK:

Notice Periods

In Spain, landlords must give tenants a minimum of six months’ notice before terminating a lease. Notice periods are generally shorter in the USA and UK. However, the eviction process can be expedited in some cases, such as non-payment of rent or breach of lease terms.

Eviction Procedures

In Spain, landlords must follow a strict legal process to evict tenants, which can be lengthy and costly. Tenants have the right to contest the eviction in court. Landlords must provide a valid reason for removal, such as non-payment of rent or breach of lease terms. Eviction procedures are generally faster and less complicated in the USA and the UK.

Tenant Rights

In Spain, tenants have strong legal protections, including the right to renew leases and limit rent increases. Tenants also have the right to contest the eviction in court and can request a payment plan for rent arrears. In the USA and UK, tenant rights are generally less extensive.

We have more information in our Renting a Property in Spain guide.

Best Places to Buy a House in Spain

And now, the fun part – choosing where to buy your Spanish property! Spain offers many great options with diverse regions and cities, landscapes, lifestyles, and amenities. Let’s take a look at some of the best places to buy a house in Spain (and check out our Spain Destination Guides for more resources to help you choose):

Costa del Sol

Located on the southern coast of Spain, the Costa del Sol is a popular destination for those looking for a sunny beachfront lifestyle. It is known for its lively atmosphere, golf courses, and cultural attractions. The area offers a wide range of properties, from modern apartments to luxury villas. You will find plenty of English-speaking expats and tourists, which is great for making friends and making yourself understood.

Barcelona

Barcelona is one of Spain’s most vibrant and cosmopolitan cities, with a rich history, architecture, and culture. The city offers a mix of old-world charm and modern amenities and is known for its art scene, gastronomy, and nightlife. Properties in Barcelona can be expensive, but many options are available, from apartments in the Gothic Quarter to villas in the beautiful surrounding hills.

Madrid

Madrid is a bustling city, the capital of Spain. It offers a mix of historical and modern architecture, world-class museums, and vibrant nightlife. Comparable properties in Madrid are more affordable than in Barcelona. There is a wide selection, with options ranging from apartments in the city center to houses in the suburbs.

Valencia

Valencia is a vibrant city with a rich history and culture located on the east coast of Spain. The city is known for its stunning architecture, beaches, and lively atmosphere, as well as its food and wine. Properties in Valencia are relatively affordable, although have risen sharply since 2023. Options range from apartments in the city center to villas in the surrounding countryside.

The Balearic Islands

Mallorca, Menorca, Ibiza, and tiny Formentera are popular destinations for those looking for a sunny, Mediterranean lifestyle. The islands offer stunning beaches, crystal-clear waters, a relaxed atmosphere, and a variety of properties, from traditional houses to modern villas. Prices are high, particularly in the very chi-chi parts of these gorgeous islands.

Where Are The Cheapest Property Prices in Spain

The cost of buying a property in Spain can vary greatly depending on the location, type of property, and local market conditions. However, there are some regions in Spain where property prices are generally lower than in other areas. Here are some of the cheapest regions in Spain to buy a property:

Murcia

Located in southeastern Spain, Murcia is known for its sunny climate, beaches, and historic towns. Property prices in Murcia are generally lower than in other popular coastal areas. In Murcia, average prices for apartments and houses range from around €80,000 to €300,000.

Castilla-La Mancha

Castilla-La Mancha is a rural region in central Spain with charming villages, historic towns, and beautiful landscapes. Property prices in the area are relatively low, with average prices for apartments and houses ranging from around €80,000 to €300,000.

Extremadura

Another rural region, this time in western Spain, with beautiful natural scenery, historic towns, and affordable property prices. Average prices for apartments and houses in Extremadura range from around €60,000 to €250,000.

Andalucía

While Andalucía is a popular tourist destination with many high-end properties, there are also some more affordable areas within the region. Average prices for apartments from around €100,000 to €300,000. Inland areas and smaller towns and villages can offer cheaper options than an equivalent at the coast.

Property Price Ranges (Euros)
	House	Apartment
Murcia	150,000 – 300,000	80,000 – 150,000
Castilla-La Mancha	150,000 – 300,000	80,000 – 150,000
Extremadura	150,000 – 250,000	60,000 – 120,000
Andalucía	200,000 – 500,000	100,000 – 300,000

Home Sweet Home

Whether you’re drawn to the sunny coasts, vibrant cities, or tranquil countryside, Spain has something to offer for every prospective buyer.

Buying a property in Spain can be a rewarding endeavor. A range of opportunities is open to you — personal use, holiday retreats, or investment purposes. By understanding the Spanish property market, navigating the legal and financial requirements, and avoiding common pitfalls, you can act on a well-informed decision that works for you.

Engaging with reputable professionals, such as real estate agents and lawyers, is crucial to ensure a smooth transaction. With careful planning and diligent research, you can turn your dream of owning a Spanish property into a reality and enjoy the many benefits of life in this beautiful country.

Our guide on how to buy a property in Spain gives you the confidence to start your search.

FAQ – How to Buy A Property In Spain