How is the process of buying a real estate property in Spain?

Buying a real estate property is a very important decision, particularly in another country not your own. It can be a very long, complex and confusing process.

The process begins with deciding on a budget and the kind of property you would like to buy.  Is it for investment purposes, a vacation house or a permanent dwelling? How much are you willing to spend? What kind of property are you looking for? A high-rise, a historic structure, a house with a view of the sea? What are your requirements? Three-bedrooms, a swimming pool, near restaurants and shops?

Spanish real estate market

In Spain, the real estate market had stabilized after the global financial crisis from which it suffered greatly and property prices had been steadily rising since 2016. Unfortunately, in 2020 the Covid-19 global pandemic affected the real estate market but the full effect of Covid-19 on the Spanish property market is still to be seen.

Buying a real estate property in Spain

Once the purpose and budget of the real estate property has been determined, then extensive research on the location is necessary. It is easy for foreigners to buy real estate in Spain as there are many websites and real estate agents catering to every nationality, language and budget. It is important that buyers personally view the property first and follow the legal processes closely.

Financing possibilities need to also be considered and determined. Foreigners can avail of mortgage financing from Spanish and internationals banks to buy real estate property.  However, overseas buyers can only borrow at a lower loan-to-value rate than Spanish residents of only 60% to 70% and will therefore need to make a bigger down payment.

There are several steps that foreigners buying property in Spain should take for a smooth, problem free process.

Step 1: Procedures Prior to Signing the Contract

Application for a Foreigners Identity Number (Numero de Identificacion del Extranjero or NIE):

This number is unique to every individual and is necessary to carry out any transaction in Spain.  The NIE can be obtained from any police station where only the applicant’s passport is required.

Opening a Bank Account in Spain:

To facilitate financial transactions, a bank account in any of Spain’s financial institutions is required.


Hiring a licensed lawyer who specializes in Spanish land law and registered with the local bar association (Colegio de Abogados) is necessary to complete due diligence and is also required by many financial institutions.  The registration of the property will also require the services of a lawyer.

The services of a certified real estate agent, preferably one who is accustomed to doing business with foreigners, is advisable from finding the right property to issues after signing the deed of sale.  They can provide detailed information about the area or city where you are looking to buy property and the different properties available.

Step 2: Exercising Real Estate Due Diligence

A property survey is advisable when purchasing real estate property. A building  survey assures the buyer that there are no significant structural defects and problems with the property. A property survey also provides a comprehensive guide to the condition of the property.

A valuation report by an accredited property appraiser gives the buyer an idea of the property’s market value.

The buyer must also make sure that the property is registered with the land registry (Registro de Propiedad), that there is appropriate planning permission from the local government, and that the property has no outstanding debts.

Step 3: Drafting and Signing of Private Contracts

When the buyer’s offer price has been accepted by the seller, the two parties need to sign a preliminary contract (contrato privado de compravento) and the buyer needs to make a down payment of customarily about 10% of the purchase price.

Step 4: The Formalization of the Deed of Sale

The contract of sale (escritura de compravento) is usually signed in front of a notary, at which point the full sale price, taxes and other costs become due.

Step 5: Issues After the Signing of the Deed


It is highly recommended that the buyer insures the real estate property. A building insurance policy are often a requirement of mortgage providers. Content insurance is not legally necessary but a wise investment if the property will be rented out or the owner spends a lot of time away from home.


Spanish law requires that the buyer pay a property transfer tax of about 6 to 10% for existing properties plus VAT or 10% for new properties.

Notary costs, title deed tax and land registration fee are from 1 to 2.5%

Utilities and Telecommunications: 

The former owner may already have a system in place and the buyer just takes over the payments.  If none, the buyer must apply for the utilities like water and electricity, and internet connectivity.