Skip to main content

Are you a foreigner looking to invest in a home in Spain? If so, Terra Homes is here to help clear up any concerns you may have in this regard.

Can a foreigner buy a house in Spain?

Yes, there are no problems for foreigners buying a property in Spain. In fact, there are a lot of foreigners who buy homes in Spain. For example, there are a lot of British nationals who own a second home here.

As a foreigner, what are the requirements for buying a home in Spain?

Foreigners wanting to buy a house in Spain only need to meet one requirement, which is tohave a NIE (Foreigner Identification Number). This number allows people to process all the required paperwork and also means they can be identified.

Beyond this, there are no other requirements needed to invest in a home in Spain as a foreigner. You do not even need to have a bank account in the country, although when making the payments involved with such an investment, it is definitely more convenient to have one.

How does a foreigner buy a home in Spain?

To buy a home in Spain you need to go to a Notary’s Office, regardless of if you are Spanish or foreign. The purchase will be recorded in the Property Register, which is a public record.

Likewise, before formally recording the purchase of a house with a notary public, it is common to sign a so-called security agreement, in which the parties agree the following:

  • That the buyer reserves the right to buy the home, in exchange for a certain amount of money.
  • That the seller hands over the home to the buyer in the agreed conditions, upon the completion of the purchase and sale.

The deposit paid by the buyer upon the signing of the security agreement will then be discounted from the purchase price of the home

What taxes do you have to pay when buying a house in Spain?

Let’s take a look at the taxes related to buying a house in Spain:

  • Value Added Tax (IVA, in Spanish), if it is a new build or the first sale of the house. In this case, the lien is 10%.
  • Property Transfer Price (ITP, in Spanish), if it is a used house or not the first sale. This will range from 6% to 10%, based on the Autonomous Community in which the house is located.
  • Stamp Duty (AJD, in Spanish). This is paid and is applied to the IVA and when the home is bought using a mortgage.
  • Property Tax (IBI, in Spanish).
  • Mortgage Taxes,if applicable.
  • Income Tax (IRPF, in Spanish).
  • Non-resident Income Tax if you are not a permanent resident of Spain.
  • Capital Gains Tax, if applicable.

What are the other costs involved when buying a home in Spain?

Along with the taxes stated above, acquiring a home in Spain can also include the following costs:

  • Public deed with a Notary Public.
  • Registration in the Property Register of the public deed.
  • If you are buying the home with a mortgage, you have to pay for the appraisal and issuance of the mortgage with a Notary’s Office, as well as the registration of the mortgage deed in the Property Register.

As a foreigner, what are the steps for buying a home in Spain?

Let’s take a look at the step by step process for a foreigner to buy a property in Spain:

  1. The first thing to do is get a NIE, as without this number it is impossible to invest in property in Spain.
  2. Once you have this NIE, if you have already found the property you want to buy, you can sign the security agreement and pay a deposit to the seller. However, the agreement is not always formally recorded.
  3. When it comes to signing the purchase and sale agreement, you have to go to the Notary’s Office to process the public deed.
  4. You will then have to register the property in the name of the new owner in the Property Register.
  5. Finally, you will have to settle any fees incurred by the purchase of the house in Spain.

How long can it take for a foreigner to buy a house in Spain?

The first thing to bear in mind, as we have seen, is that the first thing a foreigner needs to do to buy a house in Spain is get a NIE. This process should not take too long, as once all of the necessary documents have been submitted, the NIE should arrive in around 10 days.

From there, it will all depend on if the purchase will be made with a mortgage or not. If you are applying for a mortgage, the bank should not take longer than two weeks to grant it if everything is in order. It should then take around a month to sign off the mortgage, however, this process can take up to three months in some cases. If you do not require a mortgage, the process is quite a bit quicker.As you can see, being a foreigner is no issue whatsoever when buying a home in Spain. Apart from getting a NIE and some tax matters, the process is no different from a Spaniard buying a house in Spain. If you need more advice on this matter, at Terra Homes, we would be glad to help.

Leave a Reply