Buying Property in Spain as a Foreigner: 2024 Guide

Spain offers an irresistible blend of vibrant culture, sunny climate, and rich history, making it a prime destination for real estate investors and individuals looking to relocate. This guide provides a comprehensive overview of the process, benefits, and considerations of buying property in Spain as a foreigner.

Country overview

Spain is a member of the European Union, being one of its 27 countries, and also part of the Eurozone nations.

It ranks as the fourth largest country in Europe and boasts some of the continent's most varied topography.

The country's diverse territories include:

  • the mainland;
  • the Balearic Islands in the Mediterranean Sea;
  • the Canary Islands in the Atlantic Ocean;
  • the autonomous cities of Ceuta and Melilla in Northern Africa.

Spain is divided into 17 autonomous communities and 50 provinces, further enriched by the unique status of Ceuta and Melilla as autonomous cities.

Home to more than 48 million people as of 2024, Spain's rich cultural and geographic diversity make it an intriguing destination for investors and explorers alike.

Why invest in Spain?

The appeal of Spain lies not only in its climate and lifestyle but also in its significant investment potential.

The country boasts over 4,900 kilometers of coastline (3,046 miles) and enjoys more than 2,500 hours of sunlight annually, alongside a generally mild climate throughout most of the year.

The exceptions are the Cantabrian coast and various mountainous areas, which receive less than 2,000 hours of sunshine and more rainfall than the rest of Spain.

Ranking as the third most visited country globally, following France and the US, Spain achieved a significant milestone in tourism in 2023, setting a new record by welcoming an estimated 85.1 million international tourists. This figure represents a 1.9% increase compared to the pre-pandemic peak in 2019. The surge in tourist numbers also led to a substantial rise in tourism revenue, with international visitors spending around €108.7 billion (159.8 billion CAD), marking an 18.2% increase from 2019. (source: Reuters)

Tourism is crucial to the Spanish economy, contributing 16% to the GDP and influencing 5.6% of the construction industry.

Market trends (2024 update)

After a period of fluctuation, the Spanish property market is stabilizing in 2024, with certain regions showing strong signs of growth. This stabilization is a positive indicator for investors, suggesting a recovering confidence in the real estate sector.

The rental market is experiencing a shift, influenced by increased demand in urban and coastal areas. This trend is particularly relevant for investors looking at short-term vacation rentals or long-term leases in cities.

There's a growing demand for energy-efficient and sustainable properties, driven by both environmental concerns and potential savings on utility costs. Properties that meet these criteria are becoming increasingly attractive to buyers and renters alike.

Average cost of buying property in Spain

As of 2024, the property market in Spain shows a diverse range of prices across its most coveted areas and cities, reflecting the varied appeal of each location to both domestic and international buyers.

City / AreaCost in EUR per m²Cost in CAD per m²
Madrid€2,965CAD $4,264
Barcelona€3,380CAD $4,857
Marbella (Costa del Sol)€3,070CAD $4,409
Balearic Islands€3,000CAD $4,309
Canary Islands€1,900CAD $2,728

While these figures provide a snapshot of the current market, property prices in Spain can vary significantly based on the exact location, property type, and market conditions.

You can easily track the latest trends and price evolutions on our dedicated page:

Can Canadians purchase property in Spain?

Yes, Canadians can easily purchase property in Spain.

The Spanish property market is open to investors from all over the world. There are no legal restrictions specific to non-EU citizens regarding property ownership in Spain.

However, the process involves several steps, including obtaining a foreigner identification number (NIE), opening a Spanish bank account, and navigating the Spanish legal system.

It's advisable to work with a reputable real estate agent and a lawyer who specializes in Spanish property law to ensure a smooth transaction.

The Golden Visa

The Golden Visa is a residency program aimed at non-EU investors, offering them and their families the right to live in Spain. To qualify, individuals must make an investment in Spain, such as purchasing real estate worth at least €500,000 (CAD $735’044).

The Golden Visa offers several benefits:

  • Residency: It grants the investor, their spouse, and dependent children the right to live in Spain.
  • Travel: It allows for visa-free travel within the Schengen Zone.
  • Path to permanent residency and citizenship: After five years, investors can apply for permanent residency, and after ten years, they may apply for Spanish citizenship, subject to meeting certain conditions.

You can learn more about the Golden Visa on the official Spanish government's website.

Popular regions and areas

Spain's rich geographical diversity and cultural heritage mean you can choose from a wide array of regions and areas, each offering its own unique appeal and lifestyle.

Popular regions for investment and living

  • Costa del Sol: Known for its beautiful beaches, golf courses, and luxurious lifestyle, the Costa del Sol is particularly popular among expats and retirees. Property types range from beachfront apartments to luxury villas.
  • Costa Blanca: Famous for its white sandy beaches and mild climate, the Costa Blanca attracts many Northern European residents. Options include everything from quaint townhouses in traditional villages to modern villas with sea views.
  • Barcelona: As one of Spain's most cosmopolitan cities, Barcelona offers a vibrant urban lifestyle with its rich culture, architecture, and dining scene. Property types vary from historic apartments in the Gothic Quarter to modern homes in newer developments.
  • Madrid: The capital city provides a dynamic living environment with its mix of cultural offerings, extensive parklands, and business opportunities. Housing options include city-center apartments, suburban family homes, and luxurious estates.
  • The Balearic Islands: Including Mallorca, Menorca, Ibiza, and Formentera, these islands are renowned for their stunning landscapes, clear waters, and vibrant nightlife. Properties range from traditional fincas (a rural estate/ farmhouse) to exclusive waterfront villas.
  • The Canary Islands: Offering a unique blend of European and African cultures with a fantastic climate year-round, the Canary Islands are perfect for those looking to enjoy outdoor lifestyles. Available properties include beachfront condos, hillside villas, and rural homes.

The buying process step by step

1. Obtain an NIE (Número de Identificación de Extranjero)

NIE (Número de Identificación de Extranjero) is an identification number for foreigners. It is essential for any significant financial transaction in Spain, including buying property, setting up utility services, and filing taxes.

You can apply for an NIE at the Spanish consulate in your home country or directly in Spain at a local police station. The application requires:

  • a valid passport;
  • a completed application form (Ex-15);
  • a reason for requesting the NIE (such as property purchase).

The process can take from a few days to several weeks.

2. Open a Spanish bank account

A local bank account is necessary for managing payments related to the property purchase, including the deposit, purchase price, taxes, and ongoing utility payments.

Most banks will require:

  • your NIE;
  • passport;
  • proof of employment or income;
  • possibly a proof of address.

3. Start searching for properties

Explore online listings on Properstar to find properties for sale in your area of interest. You can leverage our advanced filters and even draw your preferred area on the map.

Consider hiring a real estate agent to gain better insights into the market and assistance in finding properties that meet your criteria and budget.

4. Find the right real estate agent

The right real estate agent can provide insights into the local market, assist in finding properties that meet your criteria, and navigate the negotiation process.

Here's how to ensure you pick the best professional for your needs:

  • Local expertise: Look for agents with a deep understanding of the area you're interested in. They should be knowledgeable about local property trends, prices, and the unique aspects of the community.
  • Language skills: If you're not fluent in Spanish, finding an agent who can communicate effectively in your language is essential. They'll act as your liaison with sellers, lawyers, and other parties involved in the process.
  • Experience and credentials: Check the agent's experience and qualifications. They should have a solid track record of assisting foreign buyers and be registered with a recognized real estate association in Spain.

You can utilize Properstar's agent search feature to find reputable local real estate agents. Our platform offers access to a wide network of professionals vetted for their expertise and reliability, making finding someone who meets your specific needs easier.

5. Conduct property viewings

Visit potential properties to assess their condition, location, and suitability.

6. Legal checks and due diligence

The Land Registry (Registro de la Propiedad) is crucial to verify the property's legal status, ensuring it's free of debts, charges, or embargoes and that the seller holds the legal right to sell. This can be done by requesting a nota simple from the Land Registry.

Ensure the property complies with local zoning and urban planning laws. This is particularly important for new builds or rural properties, where there might be restrictions.

Although not a legal requirement, it's highly recommended to conduct a property survey to check the physical condition of the property. This can uncover potential issues with the building's structure, utilities, or land.

7. Make an offer

With the help of your real estate agent, make an offer on the property. If accepted, you'll proceed to the contract stage.

8. Sign the preliminary contract (Contrato de arras)

This preliminary agreement between buyer and seller (contrato de arras) secures the purchase and typically involves a deposit from the buyer (usually 10% of the purchase price). It specifies the sale's terms and conditions and commits both parties to the transaction.

If the buyer pulls out, they lose the deposit. If the seller pulls out, they must pay back double the deposit amount.

9. Finalize mortgage arrangements (if applicable)

Finalize the terms with your bank if you're financing the purchase through a mortgage.

10. Sign the deed of sale (Escritura de compraventa)

The final step is signing the deed of sale (escritura de compraventa) before a notary, transferring ownership. The buyer must pay the remaining purchase price and all associated taxes and fees at this time.

Both parties must present their identification, the NIE, proof of deposit payment, and any mortgage details, if applicable.

11. Register the property

After the deed is signed, the new owner must register the property at the local Land Registry. This step is essential for legal protection.

12. Pay associated taxes and fees

Buyers are responsible for paying property transfer tax (ITP) for resale properties or VAT (IVA) for new properties, plus stamp duty, notary fees, and registry fees. Depending on the region, the total cost can range from 8% to 12% of the purchase price.

Taxes for new properties

TaxPercentage
VAT (IVA)10% of the purchase price
Stamp Duty (AJD)1.2% of the purchase price

Taxes for resale properties

TaxPercentage
Transfer Tax (ITP)Generally flat 7%, but can vary depending on the autonomous community

Additional costs

TaxPercentage
Notary feesAround 0.5% to 1% of the purchase price
Land Registry feesBetween 0.5% and 1%
Legal feesTypically around 1% of the purchase price

Given the complexity of the process, it's advisable to hire a lawyer specialized in Spanish property law. They can handle legal checks, negotiations, and paperwork, ensuring your rights are protected throughout the purchase.

Some valuable resources for official information include:

  • Spanish Ministry of Foreign Affairs: For information on NIE application procedures for foreigners.
  • Registro de la Propiedad (Land Registry): For checks on property legal status.
  • Agencia Tributaria (Spanish Tax Agency): For details on taxes related to property transactions.
  • Colegio de Registradores de España: Offers insights into the property registration process.

13. Transfer utilities

Transfer utilities to your name and set up local services.

Getting a mortgage

Many Spanish banks like Santander, BBVA and CaixaBank offer mortgages to foreigners, although the terms and conditions may vary compared to those for residents.

Interest rates for mortgages in Spain vary, with some banks offering competitive rates for non-residents. For example, CaixaBank has rates around 3.70%, while Sabadell has been noted for offering an effective rate of 2.75% for its customers. These rates can fluctuate and may depend on various factors including the bank's terms and your financial profile.

How to obtain a mortgage

Generally, you'll need a valid passport or NIE, proof of income, recent bank statements, a credit report from your home country, proof of your main residence, and proof of deposit. Most Spanish banks will accept documents in English without requiring translation.

After preparing your documents, the next step is to approach banks for mortgage pre-offers, which give you an idea of the loan amounts and interest rates you might expect.

Ensure all necessary documentation for the property is accurate and up-to-date, including property deeds and energy certificates.

Once the mortgage is approved, the bank will handle most of the legal and administrative tasks.

Special considerations for non-residents

Non-residents can generally obtain mortgages covering up to 70% of the property's sale price or appraised value, requiring at least a 30% down payment plus taxes and fees.

The process for non-residents involves more documentation and a slightly different approach compared to residents. It's also worth noting that non-resident mortgages often have higher interest rates than those for residents, reflecting the greater difficulty in managing international defaults.

Pitfalls of buying property in Spain

One key challenge is managing the complexities of Spanish bureaucracy, which can differ significantly from what you may be accustomed to in your home country.

For example, ensuring you have the necessary registrations, such as the NIE (foreigner identification number) and a Spanish bank account, in place before beginning the property buying process is crucial to avoid delays.

To avoid financial surprises, make sure you understand the real costs of buying property, including taxes, fees, and potential renovation expenses.

Don't underestimate the importance of comprehensive property research, including legal checks and understanding local market conditions.

Engaging with reputable local real estate agents who can provide guidance tailored to the unique aspects of the Spanish market is highly recommended.

Frequently asked questions about property purchases in Spain

There are no limits for non-citizens to buy property in Spain. You just need to have all the documents translated to provide to the Notary, Land Registry, and bank. Additionally, you need to get an NIE (personal identification number) to close the deals. The good news is that you can get residence status if you buy a house or several houses worth a total of €500,000.

You can find small apartments in tourist areas, but check everything twice to ensure you get what you pay for. Since house prices in Barcelona are quite high, you can look for other coastal cities like Almeria, some areas of Alicante and Murcia, Castile, or Aragon. Cheaper houses can be found inland, like Toledo, Albacete, or Cáceres.

Costa del Sol is a favorite among expats for its warm climate, beautiful beaches, and relaxed lifestyle. Towns like Marbella and Estepona have good international schools and are great for outdoor activities.

That's true, debts are associated with property thus it is crucial to consult the Land Registry prior to signing the sale contract to make sure you don't get any debts from the previous house owner. For appr. 20-30 € you can do a land registry search and get details about any legal issues of the house. Or you can hire a lawyer to handle all issues.

Obtaining a mortgage in Spain can take around 4 to 6 weeks, depending on various factors including the bank's processes and your documentation.

Download the complete guide for free

Ready to turn your dream of owning property in Spain into reality? Our comprehensive guide, "How to Buy Property in Spain," is your essential resource for confidently navigating the Spanish real estate market.

Fill out the form below and download your copy now.