Buying Property in Spain as a Foreigner

Buying Property in Spain as a Foreigner

Requirements, Documents, Taxes and Key Considerations for Non-Residents

Foreign citizens are free to purchase residential and commercial property in Spain. Spanish citizenship or a residence permit is not required: the buyer may be a resident or non-resident, an individual or a foreign company.

However, buying property as a foreigner involves several specific requirements. The buyer must obtain an NIE, prepare documents proving the source of funds, complete banking compliance checks, calculate the relevant taxes and conduct legal due diligence before paying a substantial deposit.

Who Can Buy Property in Spain?

Spain does not impose general restrictions on foreign citizens purchasing property. A buyer may acquire an apartment, house, villa, plot of land, commercial unit or income-producing asset.

Once the transaction has been completed, the foreign owner’s property rights are protected on the same legal basis as those of a Spanish owner. However, tax obligations and banking requirements may vary depending on whether the buyer is a Spanish tax resident or a non-resident.

Property can be purchased for personal residence, holidays, long-term rental, investment or capital preservation.

Is a Residence Permit Required?

A Spanish residence permit is not required to purchase property. A foreign citizen can own a property without living permanently in Spain.

However, ownership does not automatically grant the right to reside or work in the country. Since 3 April 2025, the provisions allowing new investor visas and residence permits based on property investment have been repealed. Purchasing property is therefore no longer an independent basis for obtaining the so-called Golden Visa.

Anyone planning to relocate to Spain must consider a separate immigration route, such as the digital nomad visa, non-lucrative residence, a work permit, family residence or another option provided by law.

Obtaining an NIE

A foreign buyer needs an NIE — Número de Identidad de Extranjero — to complete the purchase. This is the personal identification number used for the main administrative and tax procedures involving foreigners in Spain.

The NIE is required for:

The application can be submitted in person in Spain, through a Spanish consulate or through an authorised representative acting under a notarised power of attorney.

Obtaining an NIE does not mean obtaining residence status and does not grant the right to live in Spain. It is only a foreigner identification number.

Bank Account and Proof of Funds

The payment structure depends on the individual transaction, although foreign buyers are generally advised to open an account with a Spanish bank. It can be used to pay taxes, utility bills, insurance, community fees and other property-related expenses.

One of the most important stages is proving the legitimate source of the purchase funds. Spanish banks, notaries and other parties involved in the transaction must comply with financial monitoring and anti-money-laundering regulations.

The buyer may be asked to provide:

These documents should be prepared in advance. If the bank cannot verify the source of the funds, the transfer may be delayed and completion of the purchase may have to be postponed.

Particular attention should be paid to transfers originating from countries, currencies or financial institutions subject to enhanced compliance procedures.

Can a Foreigner Obtain a Mortgage?

Spanish banks offer mortgages to foreign buyers, including non-residents. However, the terms available to non-residents are generally more conservative.

The bank evaluates:

A non-resident usually needs to contribute more personal capital than a resident. Taxes and transaction costs must also be covered separately, as mortgage financing does not normally cover them in full.

When the purchase depends on mortgage approval, this condition should be included in the reservation agreement or deposit contract. Otherwise, a refusal by the bank could result in the loss of the deposit.

Legal Due Diligence on the Property

Before signing a deposit contract, the foreign buyer should arrange an independent legal review of the property.

One of the main documents is the nota simple, an extract from the Land Registry. It identifies the registered owner, the recorded characteristics of the property, mortgages, seizures and other encumbrances.

The review should also establish:

When purchasing a new-build property, the developer, land ownership, building licence, technical documentation, delivery deadlines and guarantees covering advance payments must be checked.

The buyer’s lawyer or legal representative should act independently of the seller, developer and agency representing the selling party.

Reservation and Deposit Contract

Once a property has been selected, the buyer usually signs a reservation agreement and pays an agreed amount. The document should clearly state the price, the reservation period, the conditions for refunding the payment and the seller’s obligations.

After the legal review has been completed, the parties may sign a contrato de arras, a private deposit contract.

It normally establishes:

A deposit contract should not be signed without fully understanding the consequences of withdrawing from the transaction. If the buyer withdraws without a contractual justification, the deposit may be lost. If the seller withdraws, they are normally required to return twice the amount received.

Taxes When a Foreigner Buys Property

The taxes payable by the buyer depend primarily on the type of property and its location rather than the buyer’s nationality.

When purchasing a new residential property from a developer, VAT, known as IVA, is generally charged at 10%. Stamp duty, AJD, is also payable at a rate determined by the autonomous community. Commercial property and certain other types of real estate may be subject to IVA at 21%.

When purchasing a resale property, the buyer pays transfer tax, ITP. The applicable rate depends on the autonomous community and, in some cases, on the value of the property or the buyer’s circumstances.

Additional costs may include:

The buyer should maintain a financial reserve above the purchase price. The exact budget must be calculated individually according to the region, property type and transaction structure.

Taxes and Expenses After the Purchase

A foreign owner must pay the annual municipal property tax, IBI, as well as utilities, insurance and community fees.

If the owner remains a Spanish tax non-resident, non-resident income tax obligations may arise. The applicable tax treatment depends on whether the property is used personally, remains vacant or is rented out.

Rental income generated by property in Spain must be declared. The method used to calculate the tax may depend on the owner’s country of tax residence and the applicable double taxation agreement.

For high-value property, the possible application of wealth tax and the temporary solidarity tax on large fortunes should also be reviewed separately.

Can the Transaction Be Completed Remotely?

A foreign buyer can purchase property without being personally present at every stage.

A notarised power of attorney may be granted to a lawyer or another authorised representative. Depending on the powers granted, the representative may:

The power of attorney can be signed in Spain, at a Spanish consulate or before a notary in the buyer’s country of residence. In the latter case, an apostille or consular legalisation and an official Spanish translation may be required.

Buying as an Individual or Through a Company

Most foreign buyers purchase residential property in their personal name. This structure is generally simpler for completion, banking and future personal use.

Purchasing through a company may be considered when acquiring commercial property, several investment properties, a hotel asset, an entire building or a development project.

However, corporate ownership does not always reduce the overall tax burden. A company must maintain accounts, file tax returns and demonstrate its economic activity.

Before choosing the ownership structure, the buyer should compare the taxes arising on acquisition, ownership, rental income and a future sale.

Main Risks for Foreign Buyers

The main risk is transferring money before the legal and banking checks have been completed.

Foreign buyers also sometimes:

All documents should be fully understood before they are signed. A written translation or independent interpreter should be used when necessary.

Conclusion

A foreign citizen can freely purchase property in Spain without holding a residence permit. A safe transaction requires obtaining an NIE, preparing proof of funds, selecting the appropriate financing structure, checking the legal status of the property and calculating the taxes and additional costs in advance.

It is important to understand that purchasing property is no longer an independent basis for obtaining a new investor residence permit. The property transaction and the process of relocating to Spain should therefore be treated as two separate matters.

GG Real Estate Barcelona represents the buyer’s interests exclusively and supports international clients throughout the entire process: from selecting the right region and property to banking compliance, legal due diligence, negotiations, notarial completion and registration of ownership.

Frequently Asked Questions

Can a foreigner without Spanish residence buy property in Spain?

Yes. A Spanish residence permit is not required to purchase property.

Does a foreign buyer need an NIE?

Yes. The NIE is required to sign the public deed, pay taxes and register ownership.

Does purchasing property grant the right to live in Spain?

No. Since 3 April 2025, new investor visas and residence permits based on property investment are no longer issued. A separate immigration basis is required to relocate to Spain.

Can a non-resident obtain a mortgage?

Yes. Spanish banks offer mortgages to non-residents, but they generally require a larger down payment and detailed evidence of income.

Can property be purchased remotely?

Yes. The purchase can be completed through an authorised representative acting under a notarised power of attorney.

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