Guide to Buying Spain Real Estate

Western Europe’s second-largest country, Spain offers an affordable lifestyle and a plenty of choice when it comes to real estate.

Spain is one of Europe’s most popular destinations for buying real estate. With over 3,000 miles of coastline, a warm Mediterranean climate, and historic cities full of charm and culture, it’s no wonder more and more Americans and Canadians are looking here for their overseas home.

Whether you’re searching for a city apartment in Madrid or Barcelona, a beachside condo on the Costa del Sol, or a countryside retreat in Andalucia, Spain offers something for every lifestyle and budget.

Thanks to its efficient transport network with easy travel links to the rest of Europe (including Italy, Portugal and France), top-quality healthcare, and low cost of living, Spain is equally attractive for retirees and digital nomads.

Foreigners are allowed to buy property in Spain, and the process is generally straightforward. However, there are a few specific steps and considerations you’ll want to understand before making a purchase. This guide walks through everything you need to know about buying property in Spain…including where to buy, legal steps, taxes, and what life is like for expats once you arrive.

Why Invest in Real Estate In Spain

Spain consistently ranks as one of the top destinations for property investment in Europe. It offers a combination of lifestyle appeal, economic stability, and strong legal protections that make it an attractive choice for both full-time residents and international investors.

The country’s mild climate, beautiful coastlines, and rich cultural heritage draw millions of tourists each year. This constant flow of visitors supports a thriving short-term rental market, especially in beach towns and major cities. In high-demand areas like the Costa del Sol or Barcelona, well-located properties can provide consistent rental income year-round.

Spain’s real estate laws are favorable to foreign buyers. Non-EU nationals are free to own property outright, and the country’s land registry system ensures that title information is publicly available and easy to verify. With the help of a local lawyer and notary, the buying process is secure and well-regulated.

Property prices in Spain are still competitive compared to other Western European countries. There’s also room for capital appreciation in up-and-coming neighborhoods and developing coastal towns.

Spain’s cost of living is generally lower than in North America and northern Europe. This makes it easier for retirees, remote workers, and families to stretch their budget while enjoying a high quality of life. The healthcare system is excellent, public transport is reliable, and fresh food is abundant and affordable.

The Golden Visa program—although no longer tied to real estate as of recent reforms—has historically added to investor interest. Other visa options, such as the non-lucrative and digital nomad visas, continue to support demand from overseas buyers looking to live in Spain full or part time.

Where to Buy Property in Spain

The real estate market in Spain is as varied as its landscapes. 

Europeans flock to Spain’s beaches from every country afflicted by a cold winter. While prices can be high on the popular beaches of Spain, there are still a number of less-discovered coasts where you can find a little piece of beachfront property to call your own.

Costa del Sol

The Costa del Sol remains one of the top regions for international buyers on the Spanish coastline, and is popular for those looking to buy, rent, or invest in beachside real estate.

Stretching from Málaga to Estepona, this area is known for its year-round sun, golf courses, and strong expat communities. Marbella and Fuengirola are among the most popular towns, offering beachfront condos, villas, and modern amenities. 

The Costa del Sol is famous for its long beaches and vibrant towns.

The area also has one of the most active rental markets in Spain, making it ideal for investors. But beware, many parts of the Costa del Sol are overbuilt and overpriced. Location is everything here.

Depending on whether it’s beachfront or in the foothills, there’s a huge variation in prices. There’s little point in shopping with less than $140,000. While you can find the odd small apartment for less, it’ll be in older, undesirable buildings–or hold as much space as a dollhouse.

Over the past several decades, a billion-dollar Path of Progress has been moving west along this coastline and the town of Estepona, known as the “Garden of the Costa del Sol” for its stunning palm tree-lined promenades and flower-filled plazas, is at the forefront of this. (A path of progress is anything that makes a place easier to get to, like new roads, airports, or bridges, or more desirable, say, a 5-star resort in a place that previously only had cheap hostels). 

Estepona

Estepona is about 15 minutes’ drive west of the famed marina town of Puerto Banús.

In the last 10 years, the area around Estepona has seen the development of world-class golf courses, 5-star resorts, incredible marinas, and million-dollar residential communities. As the money has flowed in, Estepona has become one of the prettiest towns on the Costa del Sol.

Estepona is easily one of Spain’s prettiest coastal towns. 

It’s home to pristine promenades that meander beside golden-sand beaches…charming, cobblestoned squares filled with orange trees that give the town the smell of orange blossoms in springtime…winding alleys of stunning white-washed homes, with hanging baskets of flowers that add riotous splashes of color…

But as it’s developed, Estepona has worked to retain its traditional Spanish charm in a way that many other towns along this coast have not. Quaint cafés and rustic tapas bars blend effortlessly with organic supermarkets and high-end restaurants, giving this town a unique mix of modernity and tradition.

Costa Blanca

Alicante and the Costa Blanca, further north along the Mediterranean, also attract many foreign buyers. Less commercialized than the Costa del Sol, the Costa Blanca (White Coast) is the second-most popular choice for buyers and investors seeking retirement or vacation homes.

The Costa Blanca may not have the same global name recognition as the Costa del Sol, but it’s been a favored vacation spot among Northern Europeans for decades. It’s also home to some of the most beautiful beaches and coastal towns in the country. Alicante boasts an incredible climate, with 300 sunny days a year.

The city of Alicante is the Costa Brava’s biggest population center, and its combination of city and beach life has been drawing expats for decades. 

This region offers more affordable property prices than the Costa del Sol while still delivering warm weather, sea views, and walkable town centers. Towns like Torrevieja and Javea are especially popular with retirees.

Alicante (the city) is one of the original beach city destinations in Spain. It’s been attracting tourists for decades. But while many other destinations have lost their culture and personality, becoming bland, overdeveloped, and touristy, Alicante remains a delight.

It’s also still possible to find affordable real estate in Alicante, with condos from $150,000. Factor in the strong rental potential, and Alicante can be a great place to combine lifestyle with investment.

Costa Brava

Wedged between the snow-capped Pyrenees and the Mediterranean, the picture-book Autonomous Community of Catalonia boasts some of Spain’s most spectacular coastal scenery–the Costa Brava. It boasts dramatic cliffs, golden beaches, and hidden coves framed by turquoise waters. Pine forests tumble toward the sea, and whitewashed villages cling to hillsides. Olive groves and vineyards stretch inland, while medieval towns and ancient ruins dot the landscape. 

Although not virgin territory, this region of Spain often gets overlooked in the stampede to the southern coasts. 

Barcelona and Madrid

For city living, Barcelona and Madrid are the major hubs. These cities offer the most in terms of culture, dining, and urban living. Property prices are higher, especially in central neighborhoods, but both cities have solid long-term rental markets. Buyers here are often seeking capital appreciation, lifestyle, or a mix of both.

A major tourist hub, Barcelona is famous for its laidback living as well as its famous cultural and culinary attractions. 

Barcelona has a relaxed and laidback lifestyle. People enjoy the outdoors and spending time with family and friends. When not working, locals take pleasure in spending time at the beach, socializing at a local café or bar in a plaça, or having a long lunch with family and friends. Since hosting the 1992 Olympics, the population and tourism have exploded in this area of Spain. The population of the city is almost 1.7 million people and just over 5.5 million in the greater metropolitan area. More than 17% of the city’s residents are expats from other countries.

Madrid, Spain’s sophisticated capital, offers First-World infrastructure, thriving creative life, and sunshine.  Located in the center of the Iberian Peninsula, at an altitude of 2,000 feet, Madrid’s climate is warm and dry. And although over 6 million tourists a year visit Madrid (only 20% of Barcelona’s 32 million), these sightseers, and the businesses that service them, tend to cluster in the central areas around Puerta del Sol, Plaza Mayor, Atocha, Huertas, and Paseo del Prado. Many residential neighborhoods tend to be relatively tourist-free.

Madrid is a city full of history and creativity…and boasts a warm and dry climate. 

Spanish Islands and Inland Locations

If you’re looking for island life, Mallorca, Ibiza, and Tenerife are standout choices. These destinations offer a mix of high-end homes, rustic fincas, and apartments close to the sea. Mallorca in particular combines natural beauty with excellent infrastructure and accessibility.

Mallorca is a top choice for expats looking for the Spanish lifestyle on an island. 

Back on mainland Spain, inland areas like Andalusia, Castilla-La Mancha, and Extremadura offer some of the most affordable real estate in Spain. These regions appeal to buyers seeking peace, space, and a slower pace of life. Property is less expensive, and while they may not have strong rental markets, they offer good value for long-term living.

Can Foreigners Buy Property In Spain

Buying property is legal for foreigners and relatively straightforward. 

The process of buying property in Spain is generally clear and well-regulated, though it does differ from how things are done in the U.S. or Canada. The key is to work with local professionals, especially a lawyer and a qualified real estate agent, to make sure each step is handled correctly.

There are no restrictions for foreigners buying real estate in Spain, and the process is relatively straightforward. Buying real estate in Spain is divided in three phases:

• Making an offer
• Entering in a private contract
• Completion

The private contract should contain details of the agreed deposit payment, purchase price, and details for payment of the outstanding balance of the agreed buying price plus any additional extras and your intended completion. A notary will prepare the official contracts and make sure it complies with Spanish regulations. 

Any property sale or purchase in Spain should be registered in the Land Registry, and it’s important to make sure any relevant taxes are paid before this is done.

The Real Estate Buying Process in Spain

When shopping for property in Spain, take your time. Some properties sell within a month, but others can linger on the market for a year—often because owners are seeking unrealistic sums.

Away from the popular Costas, English isn’t as widely spoken as you might expect. Real estate agents will happily give you listings, but with rock solid local interest, they can afford to ignore the language skills needed to attract international clients. Further complicating matters, most people in Catalonia use Catalan rather than standard Spanish. Signs don’t point to la playa (the beach). Here it’s la platja. The same applies to the Basque Country on Spain’s northern Atlantic coast, where many people speak Basque. Otherwise, the purchase process is fairly straightforward.

Step 1: Make an Offer

Once a property has been chosen, the first step is to make a verbal offer. You may wish to make this offer conditional to being able to obtain a mortgage. In a typical transaction for resale property, you put down an initial deposit ($3,600 to $7,200) to reserve a property. Ideally, e-mail or fax the reservation contract to your lawyer to check before signing. This initial deposit is refundable if the vendor changes his mind, but without a clause like “subject to mortgage approval,” you’ll lose your deposit if you cancel because you can’t get a loan.

Step 2: Check Title

Your lawyer ensures that Spanish legal requirements are met and that the property is bought free of encumbrances, charges, liens, or debt. In Spain, any outstanding debts are transferred with the property. Obviously, you don’t want to inherit someone else’s back taxes.

Step 3: Sign a Preliminary Agreement

You then sign a preliminary contract, called he compraventa in Spanish, and pay a portion of the purchase price, normally 10%. This is a legally binding contract that states the date of completion.

Step 4: Sign the Title Deed

On the agreed date of closing, all the parties (or their designated representatives) go to the notario’s office to sign the escritura, the deed of sale. At that point you pay the balance of the purchase price along with all fees and taxes. The entire conveyance process normally takes around eight weeks.

Transaction Costs When Buying Real Estate in Spain

As a general rule, you should allow 10% to 11% of the price of a property to cover associated purchase costs. Typical real estate commissions are around 6%, though some agents charge as much as 10%.

Depending on how much work is involved, legal fees are between 0.5% and 2% of the purchase.

Notary fees are fixed by law and normally range from $360 for lower-priced properties to $1,450 for higher-priced properties. Land registry fees amount to around $360.

Property Taxes & Fees in Spain

Buying property in Costa Rica involves several costs beyond the purchase price, but they are generally lower than what buyers might expect in other international markets. Understanding these fees upfront can help you budget accurately and avoid surprises.

Transfer Tax

Depending on whether you are purchasing new or resale property, either transfer tax (ITP) or value-added tax (IVA) will apply on the transfer of property. A 7% transfer tax (ITP) is generally charged on the purchase of real estate. When buying a parcel of land from a developer, this is replaced by IVA at 7% or 16%, plus 1% stamp duty.

Inheritance/Gift Tax

Foreign residents in Spain are liable for Spanish inheritance tax (IHT), regardless of the country in which the inheritance is situated. Non-residents are liable for Spanish IHT on assets they inherit that are physically located in Spain. Spain levies inheritance tax on assets received as an inheritance or gift. Taxes must be paid within six months, although you may file for another six-month extension.

In the case of an estate transferred to a spouse, parent, or child, a 95% deduction may apply. The condition is that the spouse, child, or parent has lived with the deceased for at least two years prior to his or her death. The amount of tax due depends on the relationship with the deceased.

Wealth Tax

Patrimonio tax is levied on your assets in Spain, including property, bank accounts, cars, bonds, stocks, and shares. For residents, the wealth tax applies only to property worth over $180,000. For non-residents, the tax is levied on all property, no matter what the value. It can be based on either cadastral value, purchase value, or the value estimated by the tax authorities, whatever is greater. The wealth tax is set at 0.2% for assets up to $197,000, and goes up to a maximum of 2.5%.

Rental Income Tax

Depending on whether or not you are deemed to be a permanent resident, the tax rate on rental income is either 25% or 35%. For non-residents, income on property is set to about 2% of the cadastral or rateable value of the property, and then a rate of 25% tax is applied to the base value. This tax is filed annually. 

Interestingly, the tax is paid by the tenant, with the tax deduction made from the rental before the net amount is passed on to the owner. Owners should insist on proof that the tax payment has been made on their behalf. Any income from rent received in Spain by non-residents is subject to a payment of a flat rate of 25%. Even if the property is not rented, owners are still liable for tax on the imputed income, at rates ranging from 2% to 20% of the official property value.

Property Tax

Local property tax (IBI) is levied by the local town hall and is paid annually. The amount is based on the fiscal or rateable value (valor catastral) of the property, and takes into account the value of the land, plus the value of the building, according to type, location, and usage. Each municipal town hall decides on the percentage to be charged in respect of local rates. In the case of Marbella, the formula applied is 0.85% of the rateable value of the property (which is usually far less than its true market value).

Capital Gains Tax

Capital gains tax is due on the sale of a number of assets, including real estate, antiques, art, stocks, and businesses. Residents over 65 years of age are exempt from capital gains on the sale of their property. 

If you are under 65 and re-invest in Spanish real estate within three years, you are not required to pay capital gains as long as the investment is equal to or larger than the proceeds of the earlier sale. Alternatively, if the property is owned for more than 10 years, then the capital gains liability disappears. However, you may be liable to tax in your country of residence. The rate of capital gains tax is 20% for residents, and 35% for non-residents.

Other Taxes

Plus valia is a local municipal tax based on the officially assessed increase in the value of the land since the last time the property changed hands. This tax is normally payable by the vendor, but it may be stipulated that the buyer pays. It can range from a few hundred dollars to as much as several thousand dollars on larger properties with a lot of land.

Can Foreigners Get a Mortgage In Spain

While many buyers in Spain choose to purchase property with cash, financing is available through local banks. Spanish banks will offer mortgages to non-residents, though the terms and requirements are often stricter than for residents.

As with many other countries around the world, it is not as straightforward for foreigners to obtain loans in Spain as it would be in their home countries. This includes mortgages to purchase real estate. 

The good news is that mortgages, both fixed and variable rate, are available, although your residency status could determine how much you can borrow. For example, the maximum loan-to-value (LTV) that banks will allow for residents is 80%, while non-residents are limited to 50% to 70%.

Whether a resident or not, you will need to provide a Número de Identificación de Extranjeros (NIE) to get a Spanish mortgage. This is a tax identification number for foreigners.

. This is what the banks will look for in your mortgage application:

• NIE
• Proof of employment or income
• A pre-agreement with the seller
• Proof that the property tax is paid to date
• Details of your current debts and mortgages
• Copies of all your existing property deeds (in Spain and elsewhere)
• Records of your current assets

The bank will review your application and then make an offer. If you agree to the mortgage terms, you will sign the contract in the presence of the notario (notary).

Spain Real Estate
Our Thoughts:

Spain continues to be one of the most attractive countries in Europe for buying real estate. With strong property rights for foreigners, a variety of locations to suit every lifestyle, and a clear buying process, it’s a destination that combines practical investment with everyday enjoyment.

Whether you’re looking for a beachfront retreat, a city apartment, or a quiet countryside home, Spain offers solid value and a relaxed lifestyle. The combination of great weather, modern infrastructure, and cultural richness makes it an ideal place to live or invest.

With legal guidance and a clear understanding of costs, buying property in Spain can be a smooth and rewarding experience. For many expats and investors, it’s not just about bricks and mortar, it’s about finding a better way of life in one of Europe’s most welcoming countries.