What you need to know if you want to buy a home in Spain

The process of buying a home in another country can seem rather complicated if you don’t know the steps to take to find the property you want to buy, know the expenses and taxes that are payable and the documents to be signed.

 With this in mind, we will set out in detail here the process of buying a home in Spain, from the search for the property and its location through to the registration of the sale in the Property Register.

Search for a home and information on it

There are several ways of searching for a property in Spain: you can search on the internet on the various property websites, you can search in person in the location where you want to buy or you can also enlist the help of a property consultant. In this latter case you need to ask whether they will charge a commission for their advice, which usually consists of a percentage of the purchase price.

For the information on the house, it is important to request a nota simple, an informative extract on the property, from the Property Register. This can either be obtained online at the website www.registradores.org or in person at the Property Register relating to the property you are interested in buying, normally in the same town or city. To make a request for a nota simple you will need the property’s registration details (Registration property number, volume, book and sheet) or the details of the location of the property and the name or company name of the owner.

The nota simple is the basic information about the property: the description of the property, who is the owner and any encumbrances it has (such as a mortgage). If there is a mortgage on the property, you will need to ask the seller for a certificate issued by the mortgage lender bank stating the outstanding amount to be paid.

If it is a newly built property, it is also important to ask the property developer for the works license and the first occupancy license. In the case of second-hand housing, you need to ask the owner for the last receipt of payment of Property Tax (in Spanish, IBI), a certificate stating they are up-to-date with the shared expenses of the building (for properties in a horizontally divided building) and a statement (that can be made in the sale deed itself) that the house is not rented.

Information about the seller

In addition to obtaining the information related to the property, you need to find out about the individual or company who owns it. An individual will have a Documento Nacional de Identidad or Spanish ID card, whereas for a company you should request its Articles of Association and the Deed of appointment or powers of attorney of the individual acting in representation of the company.

In addition, to check the company information you can request a nota simple or informative extract from the Commercial Registry, through the same website for requesting the information on the registration of the property: www.registradores.org.

Signing of the contrato de arras (earnest money contract)

Generally, in Spain before signing a public sale and purchase deed an earnest money contract or contrato de arras is signed. This is a contract in which a proportion of the sale price is handed over as a down payment and as proof of the commitment to the future sale and purchase. It is most common to sign an arras that carries a penalty where, if the sale does not go ahead for reasons attributable to the purchaser, they will forfeit the amount paid as arras, and if the sale is not completed for reasons attributable to the seller, the latter must return double the amount handed over as arras or down payment.

Spanish residency for investors or “golden visa”

In 2013, the “golden visa” was created to attract investment to Spain from outside the European Union to buy property worth over € 500,000 before tax. This visa does not require the purchaser to live in the country and therefore attracts investors from around the world.

The visa is requested at the Spanish consulate in the country of origin. The initial residence permit for investors is valid for two years. After this time, those foreign investors who are interested in living in Spain for a longer period may request the renewal of the residence permit for investors for another two-year period.

Public deed of sale

After signing an arras or earnest money contract, typically one month afterwards, the public deed of sale and purchase is normally signed in the presence of a Notary. Notaries are independent public officials who publicly testify to the sale and have the duty to provide advice to the parties involved in the sale. In addition, they draft the deed of sale and purchase according to the parties’ agreements.

The public deed is essential in order to be able to register the sale in the Property Register and obtain the security that this provides.

Payment of taxes arising from the sale

The sale of a home in Spain entails the payment of certain taxes. For a newly constructed property, you have to pay Value Added Tax (Impuesto sobre el Valor Añadido or IVA) and if it is a resale property, Transfer Tax (Impuesto de Transmisiones Patrimoniales or ITP). In both cases if you take out a mortgage you have to pay Stamp Duty (Impuesto de Actos Jurídicos documentados or AJD).

Registration of the sale in the Property Register

Once you have bought the property and paid the taxes, you must register the sale and purchase in the corresponding Property Register. This is not a legal requirement, but registration protects the buyer as the owner of the house.

Expert advice

If you are a foreigner and you want to buy a home in Spain, it is recommended that you seek the advice of specialists such as property consultants, lawyers specialising in property and tax matters, who can advise you on all aspects of the purchase so that it is safely completed.

A selection of properties for sale

See details for House/Villa Sant Andreu De Llavaneres
Sale House/Villa Sant Andreu De Llavaneres
8 bedrooms
Price : € 2,400,000
See details for House/Villa Esplugues De Llobregat
Sale House/Villa Esplugues De Llobregat
5 bedrooms
Price : € 2,250,000
See details for Apartment Barcelona
Sale Apartment Barcelona
Penthouse / duplex of 195 m2 with tourist license, calle Balmes located near the Diagonal, with beautiful terraces and ...
Price : € 2,200,000
See details for Apartment Barcelona
Sale Apartment Barcelona
5 bedrooms
Price : € 1,950,000
See details for House/Villa Chiclana De La Frontera
Sale House/Villa Chiclana De La Frontera
5 bedrooms
Price : € 1,450,000
See details for House/Villa Estoril, Cascais, Sintra
Sale House/Villa Estoril, Cascais, Sintra
Sintra Property
Price : € 1,000,000
See details for Apartment BOULOGNE-BILLANCOURT
Sale Apartment BOULOGNE-BILLANCOURT
4 rooms
Price : € 719,000
See details for Apartment BOULOGNE-BILLANCOURT
Sale Apartment BOULOGNE-BILLANCOURT
4 rooms
Price : € 661,000
See details for Apartment ALFORTVILLE
Sale Apartment ALFORTVILLE
3 rooms 2 bedrooms
Price : € 353,000