Buying property in Spain as a foreigner: the step by step

How much does buying a house in Spain cost on top of the price?

Start by working out how much money you really need, because the asking price isn’t the whole bill. The main tax depends on whether the home is a resale or a new build, and the rates are set by each region. On the Costa Blanca we’re in the Valencian Community (Comunitat Valenciana).

For a resale home you pay property transfer tax (Impuesto de Transmisiones Patrimoniales, ITP). In the Valencian Community the general rate has been 9% since 1 June 2026 (it used to be 10%). If the home is worth more than €1 million, the rate is 11%. There are reduced rates for specific cases, such as a first main home for under-35s within certain income limits, but someone buying a holiday home will normally pay the general rate.

One detail to watch: the tax office charges the tax on the price you pay or on the Cadastre’s reference value, whichever is higher. You have one month from completion to file and pay it.

For a new build (bought first-hand from the developer) there’s no ITP. You pay 10% VAT, which goes on the developer’s invoice, plus stamp duty (Actos Jurídicos Documentados, AJD) on the deed: 1.4% in general, or 0.1% if the home will be your main residence.

Then add the notary and the Land Registry (Registro de la Propiedad). Both charge according to official scales that depend on the price, so ask for a quote before signing. If you hire a gestoría (an administrative agency) to handle the filings, that has a cost too. And if you take out a mortgage, the bank will ask for a valuation, which you pay for.

Getting your NIE and a Spanish bank account

The NIE (Número de Identidad de Extranjero) is your identification number as a foreigner in Spain. Without it you can’t sign the deed or pay the taxes on the purchase. You apply for it in Spain, with an appointment at the police, or from home, at the Spanish consulate. Appointments aren’t always quick, so apply as soon as you start looking seriously. I explain it in detail on the NIE, notary and taxes page, and it’s one of the things we take care of.

The law doesn’t require a Spanish bank account to buy, but you’ll need one. The notary has to record in the deed how the price was paid, so you pay by bank transfer or banker’s draft, never in cash. And afterwards you’ll want to set up direct debits for the IBI (annual property tax), electricity, water and community fees.

The reservation and the deposit contract (arras)

Once you’ve found the home, the usual step is to sign a deposit contract (contrato de arras). It sets the price, the deposit you pay up front and the deadline for signing at the notary. Sometimes a simple reservation is signed first, to take the home off the market for a few days while the first checks are done.

The most common type is the one in article 1454 of the Spanish Civil Code (arras penitenciales). It works like this: if you pull out, you lose the deposit. If the seller pulls out, they pay you back double. So make sure the contract states clearly which type of deposit it is, and don’t sign anything before you’ve seen the nota simple.

What to check before you pay the deposit

These are the checks that save you from nasty surprises. Most can be done before the deposit contract, and anything left must be cleared before the notary.

• The nota simple from the Land Registry. It shows who owns the home, the registered floor area and any mortgages, charges or embargoes on it.
• IBI paid up to date. Ask for the latest paid bill. It also shows you the cadastral value.
• The community of owners. If the home is on an urbanisation, the buyer is liable, with the property, for unpaid fees from the current year and the three before it. The seller has to bring a certificate to the notary showing the fees are paid, which the community’s secretary or administrator must issue within seven days.
• The energy performance certificate. It’s compulsory for selling, and a registered copy is attached to the contract.
• That everything built is legal. If the home has a pool, an extension or an enclosed terrace, check that it matches the deed and the Cadastre and that it has a licence. With older urbanisation villas, this is worth looking at carefully.

The law doesn’t make you hire a lawyer to buy, but if you don’t speak Spanish or the home has any complication, an independent lawyer you trust is money well spent.

Can I get a mortgage in Spain as a non-resident?

Yes. Spanish banks lend to non-residents, although each one decides how much it will lend and which proof of income it wants from your home country. Compare several offers.

Spain’s mortgage credit law protects you exactly as it protects a resident. The bank must give you the European Standardised Information Sheet (FEIN) and the draft contract at least ten calendar days before signing. During that time you visit a notary of your choice, who explains the terms and records it in a document (acta). That document costs you nothing, and you must attend no later than the day before the mortgage is signed.

The mortgage costs are also split by law: you pay the valuation, and the bank pays the gestoría, the notary for the mortgage deed and its registration.

Signing at the notary

On completion day, buyer and seller sign the title deed (escritura) before a Spanish notary. The rest of the price is paid, the notary records how it was paid, and you get the keys. If there’s a mortgage, it’s signed at the same appointment.

If you can’t be in Spain that day, you can give a power of attorney (poder notarial) to someone you trust so they sign for you. It’s granted before a notary in Spain or, from home, at the Spanish consulate.

Your NIE, the nota simple and the money ready to transfer are the three things you can’t be without on completion day.

After completion: taxes, Land Registry, IBI and utilities

Once the deed is signed, three things remain. First, pay the tax (ITP or AJD) within one month. Second, register the deed at the Land Registry: until it’s registered, the home isn’t recorded as yours against third parties. Third, if you bought from a non-resident, pay the 3% withholding.

After that, switch the electricity and water contracts into your name and set up direct debits for the IBI, which you pay to the town hall every year, and for the community fees if there are any.

If you won’t live in Spain and don’t let the home, you’ll need to file a non-resident tax return every year (form 210) on an imputed income for owning it. It’s based on a percentage of the cadastral value and taxed at 19% if you live in the EU, Norway or Iceland, and at 24% if you live elsewhere, including the UK.

All the steps at a glance

We go through all of this with you before you sign anything: which taxes apply to you, which documents are missing and what order they go in, including when you’re buying from outside Spain. If you’re also looking in Albir, have a look at our page as an estate agent in Albir too.

Frequently asked questions