Mon 14 December 2020
Spain Guides | Can Foreigners Buy Property in Spain? How It Works, a Guide!
Many people look farther afield than just their own country to buy property. And we've dealt with clients from all over the world looking to buy their own property in Spain. Often as foreigners, they're not even sure if they can buy property in Spain, so we've written the guide to answer this question and more.
Let's start with the quick response, then we'll dive into more details...
Can foreigners buy property in Spain? There are no restrictions on foreigners buying a property in Spain, whether residential, commercial, or land. Spain actively promotes foreigners buying property and is considered very friendly for foreign buyers of property. The Spanish government offers incentives for residents and non-residents.
The rules and policies are not actually as complicated as you might think. With some guidance, you can get your hands on the property you want - at a very affordable price.
There’s also a wealth of assistance from estate agents to make the process of buying a property in a foreign country even more smooth.
As long as you know which ones you can trust, and can follow a process that can make the transaction a smooth and affordable one. That’s where you can contact us to help you.
So now we know it’s possible to buy the dream houses that spain offers ...that villa you’ve been admiring so much during your vacation; this news may bring it that much closer to being a reality.
However, it's always wise to not rush through such decisions so let’s first understand the basics of the buying process and the potential pitfalls that must be taken into account.
Foreigners buying a property in Spain - the buying process
Once you’ve decided which property you want to buy, typically you make an offer to the seller
through his or her estate agent.
In the next step, the seller either accepts the offer if it’s deemed attractive enough or else the two parties negotiate further on the price.
So far this is very much how most countries operate the sale of a house.
When a mutual price point is reached on which both buyer and seller can agree, a preliminary contract is drafted and signed by both parties. The buyers are then requested to make an advance payment which is usually 10% of the agreed price.
A notary is a requirement and will automatically form part of the process, as all purchases go through the Official Notary relevant to the property location - but fees for the notary will form part of the costs.
We also always strongly advise that you hire a lawyer to help you through the buying process. Attempting to navigate the legalities on your own would prove almost impossible for most.
Engaging relevant professionals is often cheaper than you might anticipate and is especially needed for foreigners so that they can navigate you through the legal requirements, and help you understand the terms and conditions clearly.
Also, make sure that the lawyer is registered with the local bar association.
Once the final contract is signed by the two parties, the buyer becomes liable to pay the full price and any other related charges.
Therefore, it’s important that you arrange the appropriate finances, or talk to a mortgage provider even before establishing the preliminary contract.
Estate agents are always available to help you through this entire process. Similarly, there are government websites that are also of great help.
Foreigners buying a property in Spain - Things you will need
Two things that you are definitely going to need when buying a property in Spain is your passport and NIE.
NIE is a foreign identification and you can obtain it through a representative or personally from the Ministry of Interior.
This can also be obtained through the Spanish embassy in your own country. There will be some other legal obligations that vary depending on whether you’re an EU resident or not.
If you are an EU resident, you need to have health insurance and proof of financial means. If you are not an EU resident, you will need a valid visa and marriage status.
An Estate agent and a Lawyer
Also, while it’s not a requirement, it is recommended that you hire an estate agent - as well as a lawyer to help you through the process.
Since they usually work on such deals together, they will have a better idea and can guide you accordingly at each step of the purchase. Despite some initial cost, this will almost certainly prove more helpful to you in the long run.
Similarly, having a bank account in Spain will make it easier to make multiple payments and in case you need to apply for a mortgage, you can do that through the Spanish bank.
Foreigners buying a property in Spain - buying factors
If you want to avoid any inconveniences while buying a property in Spain, here are a few factors that you should keep in mind:
1. Be clear on what property you want
Clearly, you need to know what kind of property you want and the location you want to buy - even if it’s an approximation.
Since buying a property can be a major decision, it’s advisable that you do not buy just from having one look at it.
It’s always possible that you simply fall in love with a house only to later realize that it does not fit the requirements you need it to. So hunt for a property only after considering aspects such as:
- - Should it be in a rural area or urban setting
- - An apartment or a house
- - The ideal size of the property
- - Connection to required amenities
- - Locality to the local community
- - A clear purpose in mind
The purpose of your buying decision can become more significant when considering the location. If, for example, you’re simply looking for a property as an investment rather than to live in.
2. Be as prepared as possible when buying a property in Spain
Although buying a property in Spain is not difficult, the process can be slow and tedious if you do not follow the flow of the process or do not have some of the required documents beforehand.
For instance, if you try buying a property without obtaining NIE, it won’t be possible. So, make sure you have all the essential documents needed or at least planned for in advance. Contact us for more helpful and friendly advice.
3. Ensure you have sufficient finances to purchase the property and more
Just like any other country, in Spain, buying a property will likely end up costing you more than just the buy price of the house.
There are other taxes that one must pay as well as legal and other charges. Therefore, you must ensure you have a sufficient buffer in your financial plans to avoid problems at a later stage.
Running out of cash, or going over budget is only likely to lead to more stress and more paperwork. It can delay the whole process, or at worst it can even cost you the final purchase!
4. Increase your knowledge of house buying in Spain
Being a foreigner buying a property in Spain, language can prove to be a barrier at the most critical times.
However, make sure you understand what you’re getting yourself into ...which is why it’s important to have a lawyer and an estate agent that can understand you and can communicate well. There's also a wealth of information on our site to get you started.
Similarly, never sign a contract without knowing and understanding all the terms and conditions. Definitely do not sign it in the event you’re unable to get it checked and verified by someone on your behalf.
5. Fulfill your purchase and tax responsibilities
It’s not quite as simple as transferring your money to the seller after buying a house. There are other obligations you will need to meet as well - like transferring names, and paying relevant taxes.
The required taxes need to be paid not just at the time of purchase but in later stages as well.
So, can foreigners buy property in Spain? Yes of course, but being fully prepared is the key to making it a smooth process.
Spain’s golden visa program
The Spanish government is very encouraging when it comes to foreigners buying a property in Spain. Recently, they took another step in this direction by introducing a new law.
For foreigners purchasing an amazing property in Spain worth 500,000 Euros or more, those ex-pat property investors can now get a golden visa which is essentially a permanent resident permit for the investor, spouse, and children under the age of 18.
Spain also provides them with a full work permit.
We hope this guide has been useful. The process can sometimes be slow, but it can run so much more smoothly with the right people in place. Search through the thousands of properties that fit your needs, and then contact us - by phone or email, and we can walk you through getting further details on the property you chose ...and the right people to contact.