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How do you buy a apartment or house in Spain?

15.12.2024

Investing in property is a safe way to invest capital and build passive income. It is also the ideal destination if you are planning to fulfil your dream of moving to a country where the sun always shines. Find out how to buy a flat in Spain and how much it will cost you.

Contents:

How do you buy a apartment or house in Spain?

How do you buy a apartment or house in Spain?

Required documents and permits when buying a house in Spain

Required documents and permits when buying a house in Spain

Buying a flat in Spain: taxes and fees

Buying a flat in Spain: taxes and fees

Planning to buy a property in Spain? Keep these things in mind

Planning to buy a property in Spain? Keep these things in mind

The most common mistakes when buying a house in Spain

The most common mistakes when buying a house in Spain

A home loan with a Spanish bank. Does it pay off?

A home loan with a Spanish bank. Does it pay off?

More and more Poles are choosing to invest abroad. One of the most popular locations is Spain. You can finance the purchase of a property in the country located on the Mediterranean Sea with cash or with a loan, after completing the formalities. Which ones? Read our comprehensive guide on how to buy a flat in Spain.

How is housing purchased? Differences between UK and Spain

The biggest difference is the Spanish holiday flat market, which is of great interest to foreign investors. According to available data, foreigners bought more than 87,000 properties in 2023, accounting for as much as 21% of all transactions!

The second issue is the importance of the development state in the primary market. In UK, it is simply one of the stages of construction, which, however, does not allow you to live in the property. It is different in Spain, where it is considered synonymous with the so-called turnkey finish.

There is also an interesting difference in the method of payment. In Poland it is mainly by bank transfer, while in Spain there are bankers' cheques and a ban on cash transactions. In addition, if you buy a flat from a developer, they may require you to provide documents confirming, for example, the origin of the funds for the purchase of the property in Spain.

Required documents and permits when buying a house in Spain

Required documents and permits when buying a house in Spain

How to buy a flat in Spain? The first important document is the preliminary sales contract, which is equivalent to the reservation of the property. It looks and works in a similar way to the one in Poland and specifies the date by which the notarial deed must be signed. Importantly, the contract may include an advance payment (arras confirmatorias), a deposit (arras penitenciales) or an indemnity to cover possible losses if the sale does not take place (arras penales).

The next step is to sign the notarial deed. For this you need:

an identity card or passport,
your N.I.E. number (tax identification number for foreigners),
confirmation of the opening of a bank account in Spain.

If you are financing the purchase of a flat in Spain with a mortgage, the bank may ask you to provide your tax declarations for the last 2 years information on any liabilities or your bank or BIK statements.

How to buy a flat in Spain? The first important document is the preliminary sales contract, which is equivalent to the reservation of the property. It looks and works in a similar way to the one in Poland and specifies the date by which the notarial deed must be signed. Importantly, the contract may include an advance payment (arras confirmatorias), a deposit (arras penitenciales) or an indemnity to cover possible losses if the sale does not take place (arras penales).

The next step is to sign the notarial deed. For this you need:

an identity card or passport,
your N.I.E. number (tax identification number for foreigners),
confirmation of the opening of a bank account in Spain.

If you are financing the purchase of a flat in Spain with a mortgage, the bank may ask you to provide your tax declarations for the last 2 years information on any liabilities or your bank or BIK statements.

How to buy a flat in Spain? The first important document is the preliminary sales contract, which is equivalent to the reservation of the property. It looks and works in a similar way to the one in Poland and specifies the date by which the notarial deed must be signed. Importantly, the contract may include an advance payment (arras confirmatorias), a deposit (arras penitenciales) or an indemnity to cover possible losses if the sale does not take place (arras penales).

The next step is to sign the notarial deed. For this you need:

an identity card or passport,
your N.I.E. number (tax identification number for foreigners),
confirmation of the opening of a bank account in Spain.

If you are financing the purchase of a flat in Spain with a mortgage, the bank may ask you to provide your tax declarations for the last 2 years information on any liabilities or your bank or BIK statements.

How to buy a flat in Spain? The first important document is the preliminary sales contract, which is equivalent to the reservation of the property. It looks and works in a similar way to the one in Poland and specifies the date by which the notarial deed must be signed. Importantly, the contract may include an advance payment (arras confirmatorias), a deposit (arras penitenciales) or an indemnity to cover possible losses if the sale does not take place (arras penales).

The next step is to sign the notarial deed. For this you need:

an identity card or passport,
your N.I.E. number (tax identification number for foreigners),
confirmation of the opening of a bank account in Spain.

If you are financing the purchase of a flat in Spain with a mortgage, the bank may ask you to provide your tax declarations for the last 2 years information on any liabilities or your bank or BIK statements.

Buying a flat in Spain: taxes and fees

As in UK, buying a flat in Spain involves additional charges. One of these is tax, which is sometimes included in the offer price of a property. Most often, however, sellers quote a net rate, to which must be added:

secondary market: between 4 and 10% ITP (Impuesto de Transmisión Patrimonial) transfer tax. For example, on the Costa Blanca we will pay 10% tax,
primary market: 10% VAT (IVA).

Furthermore, the purchase of property in Spain from the primary market involves the payment of an additional IAJD, i.e. tax on documented deeds. Its amount depends on the Autonomous Community, but is a maximum of 2% of the price of the flat (Murcia rate).

Other fees include the services of a notary and the registration in the land registry. These depend on the value of the property and are determined top-down by Spanish law. This means that you do not have to be guided by price when looking for a lawyer - you will pay the same at each law firm. Also bear in mind the additional costs associated with opening a bank account and a possible mortgage.

As in UK, buying a flat in Spain involves additional charges. One of these is tax, which is sometimes included in the offer price of a property. Most often, however, sellers quote a net rate, to which must be added:

secondary market: between 4 and 10% ITP (Impuesto de Transmisión Patrimonial) transfer tax. For example, on the Costa Blanca we will pay 10% tax,
primary market: 10% VAT (IVA).

Furthermore, the purchase of property in Spain from the primary market involves the payment of an additional IAJD, i.e. tax on documented deeds. Its amount depends on the Autonomous Community, but is a maximum of 2% of the price of the flat (Murcia rate).

Other fees include the services of a notary and the registration in the land registry. These depend on the value of the property and are determined top-down by Spanish law. This means that you do not have to be guided by price when looking for a lawyer - you will pay the same at each law firm. Also bear in mind the additional costs associated with opening a bank account and a possible mortgage.

As in UK, buying a flat in Spain involves additional charges. One of these is tax, which is sometimes included in the offer price of a property. Most often, however, sellers quote a net rate, to which must be added:

secondary market: between 4 and 10% ITP (Impuesto de Transmisión Patrimonial) transfer tax. For example, on the Costa Blanca we will pay 10% tax,
primary market: 10% VAT (IVA).

Furthermore, the purchase of property in Spain from the primary market involves the payment of an additional IAJD, i.e. tax on documented deeds. Its amount depends on the Autonomous Community, but is a maximum of 2% of the price of the flat (Murcia rate).

Other fees include the services of a notary and the registration in the land registry. These depend on the value of the property and are determined top-down by Spanish law. This means that you do not have to be guided by price when looking for a lawyer - you will pay the same at each law firm. Also bear in mind the additional costs associated with opening a bank account and a possible mortgage.

As in UK, buying a flat in Spain involves additional charges. One of these is tax, which is sometimes included in the offer price of a property. Most often, however, sellers quote a net rate, to which must be added:

secondary market: between 4 and 10% ITP (Impuesto de Transmisión Patrimonial) transfer tax. For example, on the Costa Blanca we will pay 10% tax,
primary market: 10% VAT (IVA).

Furthermore, the purchase of property in Spain from the primary market involves the payment of an additional IAJD, i.e. tax on documented deeds. Its amount depends on the Autonomous Community, but is a maximum of 2% of the price of the flat (Murcia rate).

Other fees include the services of a notary and the registration in the land registry. These depend on the value of the property and are determined top-down by Spanish law. This means that you do not have to be guided by price when looking for a lawyer - you will pay the same at each law firm. Also bear in mind the additional costs associated with opening a bank account and a possible mortgage.

Planning to buy a property in Spain? Keep this in mind

If you are interested in buying a flat in Spain from the primary market, check out the information on the developer. You don't have to worry about your funds. Thanks to the aval bancario, or guarantee document, the developer only receives the money after the signing of the notarial deed.

Importantly, you can finalise the purchase of a property in Spain, while still being in Poland. To do this, you must first authorise a notarised proxy, such as an agent, who will complete the formalities on your behalf.

The most common mistakes when buying a house in Spain

How to buy a property in Spain? If you need help with financing your investment, you can apply for a loan (hypoteca) of up to 70% of the value of the flat or house. However, this comes with additional costs.

In addition to the taxes and fees mentioned earlier, you must pay for a commission and an independent valuer, who determines the market value of the property in question. Most banks also require non-residents to take out a life insurance policy and home insurance.

You can take out a mortgage for a maximum of 20-25 years, but the bank sometimes offers a shorter term (depending on your age). Is it worthwhile? The average interest rate on a hypotec is 4%, which is almost half that in Poland. Nonetheless, the very use of the bank involves additional fees, to which interest must also be added.