Buying a Home on the Costa Brava as a Foreign Buyer

Buying a home in another country can raise practical questions: do you need an NIE? Must you open a Spanish bank account? What will you sign before the notary? What costs will you need to cover beyond the purchase price?

The procedures and taxes depend on your nationality, tax residence, financing and the type of property. This guide is for general guidance only; before signing, we recommend reviewing your purchase with qualified professionals.

1. Decide how you will use the property and set your budget

Before you start looking, decide whether you want a holiday home, a permanent home or a property to let at certain times. Each option may involve different requirements and implications.

Buying a property does not automatically give you the right to live in Spain. If you plan to move here, check which residency requirements apply to your circumstances.

Nor should you assume that any property can be let as tourist accommodation. Before relying on that income, check the current rules, the permissions required and any restrictions imposed by the local council or the community of owners.

Before making an offer, work out:
- The purchase price, plus the associated taxes and costs.
- Your available savings and the documents proving their source.
- Whether a mortgage is feasible, if you need financing.
- The property's regular running costs: community fees, insurance, utilities, maintenance and local taxes.

If you are buying with someone else, agree what share each of you will own and seek advice on the possible implications for your assets and inheritance.

2. The NIE

The NIE is a foreign national's identification number. When buying a property, you will generally need it to identify yourself for the paperwork and tax obligations associated with the purchase. It is not a residence permit and does not prove that you are tax-resident in Spain.

We recommend starting the application well in advance. If you are in Spain, contact the Policía Nacional; if you are abroad, consult the relevant Spanish consulate. The procedure, documents and appointment availability may vary.

You may be asked for:
- Your valid passport or another accepted identity document.
- The relevant application form.
- A document explaining the reason for your application.
- Proof of payment of the applicable fee.

Confirm the current requirements with the authority handling your application. If a representative is applying on your behalf, also check what authorisation or power of attorney they need.

Make sure your first name and surname appear exactly the same on your passport, bank documents and contracts. Any differences may mean the paperwork needs correcting before you sign.

3. Bank accounts, payments and mortgages

There is no general requirement to open a Spanish bank account to buy a property. However, it can make payments and direct debits easier to manage. Before signing, agree with the seller and the notary's office how payment will be made and documented.

If you want to open an account, ask the bank which documents it requires for your circumstances. It may request identification, an NIE, information about your tax residence, details of your work and evidence of the source of your funds. Banks must carry out anti-money laundering checks, so it is worth preparing the paperwork in advance.

Before sending money, check:
- Fees and exchange rates, if you need to convert currency.
- Transfer limits and processing times.
- The payment method agreed for the day of signing.
- That the recipient's details are correct and have been confirmed through a reliable channel.

If you need a mortgage, an illustrative quote is not final approval. The bank will assess your ability to repay, the property valuation and your documents. If the purchase depends on the loan, make sure the contract explicitly states what happens if your application is declined.

4. Check the property before signing an arras agreement

A viewing helps you decide whether the property suits your needs. Checking the documents helps you establish exactly what you are buying and on what terms.

Before paying a reservation fee or signing an arras deposit agreement, check the following, as applicable:
- Who owns the property and whether there are any registered charges, using a recent Land Registry extract, known as a nota simple.
- Whether the property description matches its actual condition and the Land Registry and Cadastre records.
- Which habitability and energy efficiency documents are required.
- Whether there are any unpaid IBI property tax bills or community fees.
- Whether special community contributions have been approved, works are outstanding or there are any planning issues.
- Whether the property is occupied, let or subject to third-party rights.

If there are extensions, discrepancies in floor area or signs of structural problems, it may be advisable to seek an architect's or another technical professional's opinion.

Arras agreements can have different consequences depending on the terms agreed. The contract should state the price, amounts paid, conditions, planned date for signing the deed and what happens if either party fails to meet their obligations. If you need a mortgage, include the relevant conditions. Do not sign or pay anything unless you understand every clause; you can ask for an independent legal review.

5. The notary, taxes and steps after signing

The public deed of sale is signed before the notary. The notary checks the parties' identity and legal capacity, carries out the checks required by law and explains the deed's contents. This does not replace a technical inspection or all the preliminary property checks.

If you cannot attend the signing, ask whether you can authorise someone else through a power of attorney. If it is granted abroad, it may require an apostille or legalisation and a sworn translation, depending on the country and circumstances. If you do not understand the language of the deed, speak to the notary's office in advance to establish whether a translation or interpreter is needed.

Purchase costs may include:
- Resale property: usually, property transfer tax.
- New-build property: usually, VAT and stamp duty.
- Other costs: notary fees, Land Registry fees and, where applicable, gestor and professional advice fees.
- If you have a mortgage: a valuation and other costs, allocated as required by law.

Taxes and any reduced rates depend on the location, value and characteristics of the transaction. Ask for an estimate tailored to your circumstances before committing to the purchase.

If the seller is not tax-resident in Spain, the buyer must generally withhold 3% of the price and pay it to the Spanish tax authority using form 211 within one month of the transfer. Check whether any exception applies.

After signing, the taxes must be settled within the applicable deadlines and the purchase submitted for registration at the Land Registry. You will also need to transfer the utility accounts into your name and arrange the direct debits. If you remain non-tax-resident in Spain, find out which tax obligations you will have each year.