Guide for foreign citizens: 
from selection to property management

You are planning to buy a new building as a second home, and Spain is on your list as a country where it makes sense to buy such a house. In this guide, we will tell you how your journey from choosing a new building in Spain to buying it can look like, and what you need to make ownership hassle-free and bring both pleasure and benefit.

The first part of the guide will discuss the process of choosing and purchasing a new building in Spain by a foreign citizen. The following stages will be considered:
- selection of the region, location, type of housing, etc.
- reservation of selected real estate and signing of a private sales contract;
- steps to be taken by the foreign buyer in order to be ready to sign the contract of sale after the completion of construction in the presence of a notary;
- definition and methods of financing the purchase of real estate;
- and finally, about the process of signing the contract of sale in the presence of a notary and taxes.

In the second part, we will tell you what the developer should do. You must understand what happens at each stage of construction and what mandatory legal procedures the developer must go through from the stage of obtaining a construction license to the right to sell newly built real estate.

In the last part, we will talk about the management of already acquired property. If you are a foreigner and the owner of real estate in Spain, you need to know how to manage your real estate so that ownership is trouble-free, and in the case of providing tourism services as a landlord, also profitable. You should take care of such things as:
- payment of taxes;
- submission of tax declarations;
- integrated management of tourist services;
- property insurance, depending on needs;
- managing your real estate investments in Spain.

Selection and purchase of a new building in Spain by a foreign citizen

01 Selection

First, you need to think about the following questions:

1. The purpose of the purchase (leisure, investment, work or all of these at once).

2. Which region of Spain to choose (north, center, south).

3. The location of the real estate (on the seashore or with a view of the sea, or in the mountains near golf courses, in the city or in the suburbs).

4. What type of new building to choose (single-family or multi-apartment). 

With the answers to these questions, find your new construction project and choose your real estate.

If you have the time and the opportunity, take advantage of our offer to organize a trip to get to know the selected region or regions of Spain in depth. There's no better way to make sure your decision is the right one than to live there for a while. You will also have the opportunity to visit selected projects of new buildings.

02 Private contract of purchase and sale of a new building

First of all, after choosing housing, you need to deposit the amount for booking the property with the signing of the reservation contract. As a rule, the first payment for housing in a new building, as a deposit, is from 3,000 to 10,000 euros.

A little later (usually this happens when the developer already has a building license) a private contract for the sale of the new building is signed, then it will be necessary to pay approximately 20% of the total cost of the housing (this amount will include the reservation amount that you paid earlier).

This contract will also include various payment terms agreed between the buyer and the developer, which will additionally be made during the construction of the object and will usually amount to another 10% of its total cost. The law also states that both the developers and the bank are jointly and severally liable for providing you with a bank guarantee, of which you are the beneficiary, to secure the deposits and advance payments made to the developers. 

This bank guarantee is valid until your property receives its first occupancy (residential) license from the city council, which guarantees that the purchase can be completed.

03 What a foreign buyer needs to do while the property is under construction. 

It is necessary to obtain a foreign national identification number (NIE) and open a bank account in Spain.
Also, before the sale is officially completed in the presence of a notary public, the buyer must successfully pass an anti-money laundering (PBC) audit, which is designed to verify that the buyer received the funds to purchase the property legally. Before going to the notary's office, the buyer must obtain the approval of the audit department to prevent money laundering.

04 Financing the purchase of real estate with own funds or through a mortgage.

If you buy real estate at your own expense, you do not need to contact the bank.

If you choose financing, there are two options:
Builder loan subrogation. The buyer has the opportunity to replace the seller and become the new owner of the loan requested by the developer for the construction of the real estate object. The terms of this type of financing are usually more favorable for the buyer. Keep in mind that by choosing this type of financing, your mortgage will be with the bank that financed the developer, which will save on costs such as appraisal fees.

Mortgage loan at other financial institutions: 
Another option is to apply for a new mortgage loan at the financial institution of your choice.

Once you have decided which financial institution will manage your mortgage, it is time to move forward with the application. To do this, you will need to provide documents about your personal work and tax situation, which will be necessary for carrying out a feasibility study and risk assessment. As a general rule, it usually takes 15 to 45 days for the bank to respond to you. 

05 Official completion of the sale in the presence of a notary


To prepare a contract of sale for a notary public, each party involved must be responsible for collecting and providing at the time of signing the necessary documentation to identify themselves and to be able to successfully complete the contract. 


- Original identity document of all involved buyers: DNI, and in the case of a foreigner - passport and NIE. 
- Marriage contracts or a confirming document in case of marriage in a regime different from the main legal regime of your citizenship (translated and apostilled).
- Power of attorney, if any (translated and apostilled).
- Confirmation of all payments made to the property before the date of the deed, indicating the account numbers of origin and destination, as well as the owners of these accounts.
- Registered bank check in favor of the seller company. The full amount outstanding must be paid after signing the contract and handing over the keys.
- The client must provide the original endorsements of the guaranteed amounts.


- Valid ID of the person signing the document.
- Power of attorney for the right to sign on behalf of the owner company.
- Deed of Horizontal Division or title deed.
- License of First Occupancy or Responsible Declaration.
- Confirmation of last year's IBI payment of the unit of sale (or plot, if there are no separate ones).
- Certificate of being up to date in the Community.
- Energy certificate of the building.
- Cadastral reference of the house (or about the main property, if it is not an individual).


1. The notary will begin reading the sales contract.
2. After reading, the seller first signs, then the buyers, and finally the notary.
3. The buyer will give the seller a check with the remaining amount to be paid and return the original guarantee.
4. The person representing the seller will hand over a welcome briefcase containing: various keys and controls, delivery slips, the rest of the property documentation and a USB stick with the property's user manual. Buyers sign a document on receiving keys and other documentation. 
5. The parties can ask the notary for a simple electronic copy of the sales contract, which they can receive instantly.


- notary fees, which depend on the sale price of the property.

 - The property registry charges a fee to register the property in your name in the official Registro de la Piedad. The rates are the same as those of a notary.

- taxes, in the case of the purchase of a new building. VAT, which in Spain has a tax rate of 10%. You are also responsible for paying stamp duty (Actos Jurídicos Documentados/AJD). This rate varies by region – expect to pay between 0.5 and 1.5%. 


Once you have signed the title deed and your property has been transferred to you, there are some formalities you must complete, such as signing a utility contract, registering with the community of owners. Stamp Duty (AJD) must also  be paid to your Autonomous Community Treasury within 30 days of the sale.


The warranty period starts from the date of signing the Act of Acceptance of Works. These are the guarantees to which you are entitled:
- Within one year, material damage due to defects or defects in workmanship affecting elements of the completion or processing of the works.
- Within three years, material damage was caused to the building due to malfunctions or defects of structural elements or installation, which lead to non-compliance with the requirements of habitability.
- Within ten years, material damage caused to the building due to malfunctions or defects of foundations, supports, beams, slabs, load-bearing walls or other structural elements that directly violate the mechanical strength and stability of the building.
- Domestic appliances installed in your home are covered by the warranty provided by the equipment manufacturers, as specified in their instructions for use, which in the European Union is a minimum of two years.

Stages of construction of a new building and obligations of the developer

From project conception to applying for the latest licenses and signing deeds, the implementation of a new construction project goes through various stages that you should be aware of if you are going to buy a new building. The entire process from obtaining a building permit to handing over the keys usually takes about 24 months.

01 Building license

Real estate development begins long before construction begins with a study of the land, the feasibility of the development and the needs to be met. At this stage of the feasibility study, the architectural studio will prepare a preliminary project of the works, in which the design will be considered taking into account the urban planning regulations, and which will be developed later until the project is provided, which includes a full description of the works and all technical and administrative aspects.
The project, which must be approved by the Board of Architects, will be necessary to obtain a building permit, which can take months or even more than a year.

After obtaining a building permit and signing the horizontal division and the deed of new construction at the notary (this deed must be registered in the Land Registry). the developer usually starts selling real estate in a new building.


02 Start of construction

After these initial stages of design and procedures, it is at this moment that the construction of the new building begins, the buyers of which will be able to observe the next stages while waiting for the completion of the work and the handover of the keys. 

A mandatory procedure that the promoter must carry out at this stage is the conclusion of ten-year insurance. This is a requirement contained in the Building Planning Act to ensure that all agents involved in construction are liable for defects in work that affect the stability and habitability of the dwelling.

03 End of construction

Foundation and construction

The foundation is one of the most delicate stages of the project, both because of the potential for complications and because of the attention that must be paid to every aspect of the process. In addition to installing formwork and concrete, this phase also includes preparing structures such as drainage or electrical systems, placing insulation, pouring cement, and checking the slab to confirm that it meets all requirements. technical requirements.
On this foundation, the floors, columns, beams and walls that will form the skeleton of the building will be erected, and the construction of the external walls and internal partitions of the lower floor of the building will begin almost simultaneously. When the skeleton construction is complete, insulation, cladding and roof construction, as well as doors and windows, will be installed.

When the frame is ready, it is time to provide the house with the necessary plumbing, electrical, gas or heating installations; as well as other types of services that the property may provide, such as a home automation system, air conditioning or security.
After this phase is completed, the project reaches its final phase, where the interior decoration, tiling of bathrooms and kitchens, windows and doors, floors and ceilings, toilets, faucets and other elements such as worktops, kitchen furniture, built-in cabinets and lights, will be carried out. to finally paint the houses.

04 Construction completed

First, after the completion of construction works, the Project Management of the construction company issues a Certificate of Completion of Works (Certificado de Final de Obra) and hands it over to the developer, this document is also approved by the College of Architects. With this certificate in hand, the developer goes to the town hall and presents the responsible declaration (Declaracion Responsable). This declaration has the same force as the first occupation license (Licencia de Primera Ocupación) for the purpose of providing public acts of sale or declarations of new construction for subsequent registration in the Land Registry.

At this time, the work execution protocol (Acta de Final de Obra) is signed, which certifies that the works and structures have been performed and completed in accordance with the project and previously issued licenses. This certificate is registered in the Land Registry and individual houses are no longer listed as "work in progress" but instead listed as "completed work". There is usually a 3 week period from the time of submission until the entry is published in the Register and therefore it will be reflected in the simple title deed of your home.

05 Delivery

When the previous stages are successfully completed, the process of registration and transfer of the property begins and when your private contract can be notarized to formalize the legal case of purchase and sale.

Property management in Spain by a foreign citizen

According to Article 9 of Law 35/2006 , the Tax Agency considers a person to be a tax resident if he meets any of the following 3 conditions:

  • Stay in Spain for more than 183 days a year.
  • Who has the core of his economic interests directly or indirectly in Spain.
  • If your spouse and/or minor children permanently reside in Spain.

If you do not meet these conditions, you are a Spanish tax non-resident.

 01 What taxes must be paid by a non-resident

Foreigners and non-foreigners who are considered non-residents in Spain and own real estate must pay the following taxes:

  • Non-resident Income Tax (IRNR)
  • Wealth Tax (IP)
  • Property tax (IBI)

IRNR: Non-resident income tax:

A non-resident who owns real estate in Spain must pay tax to the tax agency for using the property as a second residence or for the fact that it remains empty. This is fictitious taxable income. The annual taxable income is calculated on the basis of the cadastral value of the property - 2% of the cadastral value if the value has not been revised within the last 10 years, and 1.1% if it has been revised during this period. Tax rates for this income:

- 19% are paid by EU, Iceland and Norway citizens.
- 24% are paid by non-EU citizens.

IP: wealth tax

This is the tax on the property you own in Spain and which you must pay if its purchase price exceeds €700,000. Only the value that exceeds this limit, i.e. from 700,001 euros, is taxed.
This is a personal progressive tax that ranges from 0.2% to 2.5% depending on the specific value of the property.

IBI: Property Tax
This is a municipal tax of a real nature that taxes the value of real estate (house, parking space, warehouse, premises) located in Spain. Real estate owners are required to pay real estate tax to their municipality every year. The city council of each municipality is the body responsible for determining the amount of tax based on the cadastral value of the property and a percentage of this cadastral value.

02 If you rent out your property in Spain

You pay non-resident income tax (IRNR) on the actual rental income.
Taxation of income from real estate depends on the country of residence of the property owner.

Residents of the European Union, Iceland and Norway pay a tax of 19% of income. This income may be reduced by expenses related to the receipt of this income:
Residents of the European Union, Norway and Iceland may deduct expenses from the full rental income if it is proven that they are directly related to the income received in Spain.

Non-EU residents: Taxpayers living outside the European Union, Norway or Iceland pay a tax of 24% on rental income and cannot deduct any expenses. 

Tourist license

Regulatory authority over property rental licenses in Spain rests with the autonomous communities. In order to start an activity and register your real estate as accommodation for tourist purposes, you must complete and submit the "Responsible declaration for starting or carrying out an activity" form, in which you declare, among other things, that you comply with the applicable regulations for carrying out this activity.

03 Tax declaration.

You must file your tax return as a non-resident taxpayer (IRNR).

The submission deadline depends on the situation:

- if the property is not rented out, then during the calendar year following the accrual date (December 31). For example, if you had a vacant property in 2022, you can declare it until December 31, 2023.

- if the property is rented out, then the taxpayer is required to submit a quarterly declaration of income.

04 Insurance

Real estate insurance. Although home insurance is not mandatory, it is the best alternative to protect all of our belongings from the many risks that this space is exposed to.

 Depending on the assets you want to keep, you can choose insurance with more or less protection

Home Rental Protection Insurance - you'll receive guaranteed monthly rental payments in the event of non-payment, along with many other benefits that will give you the peace of mind you deserve.

05 Management of investments in residential real estate

Investing in housing offers a minimum return on sales depending on the market, which is around 6-10%, although much depends on the area and type of housing being considered. For example, in the case of second homes and homes in resort areas, this income can be even higher. An ideal residential real estate investment portfolio would be one that combines both types of real estate to diversify risks and rewards.

Frequently asked questions and answers: 

What is the definition of a new building in Spain?

Definition of a new building. According to the tax service, the following houses can be classified as a new building:
"Those purchased from the promoter after the completion of construction or renovation, unless the houses have been used continuously for a period equal to or greater than two years by persons other than the buyers."

For the state treasury, only those houses whose construction or reconstruction has been completed are important; that is, when the architect and surveyor responsible for the project issue a certificate of completion.

However, there are two very important points that affect what a new building is:

If the property was rented out for two or more years before the buyer bought it, it is still considered a new building.

Apartments purchased from financial institutions (banks) are not considered new by the administration, as they were actually previously sold to them by the promoter. Thus, even though they are new, they are not considered and taxed as such.

Why is it profitable to buy a new building?

There are many aspects that make buying a new home very profitable. The most notable are the following:
- Wide and varied offer. The new construction market offers a wide variety of both building types (apartments, penthouses, duplexes, semi-detached houses, single-family houses...) and location. In addition, its price range is very wide, so there are houses for every budget.
- Separate payment. Another big advantage of the new building. Most purchases are made while the property is under construction, so your payment is made gradually. In addition to less economic effort, this form of payment allows you to save up to the moment of handing over the keys and more calmly search for the most suitable mortgage.
- Great guarantees. Unlike used houses, new buildings have numerous guarantees that last several years and allow you to solve any case.
- Houses are ready for occupancy. Forget about difficult repairs before opening your home: new buildings are ready for occupancy from the first moment. In addition, in many cases they are already equipped with the latest generation devices.
- More effective. Unlike many used houses, newly built ones have good energy efficiency, which increases the comfort of their residents and lowers the monthly bill.
- Houses according to the menu. Most builders allow you to personalize your home during construction: floors, finishes, paint, layout...

Which region of Spain to choose for buying a new building?

It should be noted that second homes are usually located either in coastal or mountainous areas. The main thing is that both of them want to move away from the concept of big cities, and the opportunity to spend more time in the fresh air is always a priority.

A few words about the coast of Spain

With a lively atmosphere, crystal clear waters and a warm Mediterranean climate, the Costa Brava, Costa Dorada, Costa Blanca, Costa Cálida and Costa del Sol are perfect places to live and relax.

If you prefer the waves of the Atlantic, drive to the Costa da Morte in Galicia, and then you can continue the route among the stunning cliffs on the Costa Verde in Asturias and Costa Vasca, on the coast of the Cantabrian Sea (as Biscay is called in Spain).

And, of course, don't forget about the islands: the volcanic nature of the Canaries is in stark contrast to the lush Balearic vegetation of Mallorca, Ibiza and Menorca.

As for the mountainous areas, some of the most popular places to buy a second home are the mountains of Madrid or the cities around Seville. Or on the hilltops of the golf courses, which are often near the sea, providing a panoramic view of the golf course and the sea. You have to go south to play golf...at least as far as variety goes. Andalusia is the community with the largest number of areas for this sport, almost a hundred. They are closely followed by Catalonia and Madrid with 40 and 32 respectively, according to golf federations. These are the best places in Spain to play golf.

Cities for investment in residential real estate:

The Spanish housing sector continues to be the focus of attention of international investors. In 2022, Madrid will position itself as the second European destination for cross-border capital with a volume of 1,400 million euros. Barcelona, ​​for its part, occupies the seventh position in this ranking with more than 900 million euros in transactions through ten transactions. This is stated in the Capital Flows into the European Residential Sector 2022 report prepared by CBRE, a leading international real estate consulting and services company.
Madrid is second only to Berlin (1.8 billion) with a very mature market supported by the good performance of the German economy in recent years. A third destination for cross-border capital is Paris, which, along with Madrid, is experiencing a rapidly maturing residential sector. Spain is the only country where two cities are among the top ten destinations for cross-border capital, which shows the strength and good fundamentals of the national sector.

What types of housing exist? 

Let's start with the fact that the market distinguishes two large groups: single-family and multifamily. In the first case, one family lives in the entire building, and in the second - several families.

Among the homes known as single-family homes, three broad types of homes can be found:

- Independent house. It is an isolated building that does not adjoin others because it is surrounded by land. The most vivid examples of this type of housing are chalets or country houses. Its biggest disadvantages are that it is more expensive to maintain and that they usually have fewer services nearby. They may also be less secure against possible theft.

- Terraced house. They are a group of houses built in a row and attached to each other with the help of a dividing wall. Sometimes houses with two houses share common elements, such as gardens, a swimming pool or a garage.

- Semi-detached house. It is a single family home that has another attached on one side. It is similar to a semi-detached house, except that in this case one of its sides is not flanked by another building, so it usually has a larger garden. 

In the multifamily category, you can find different types of housing:

- Studio. This is a dwelling in which the kitchen, living room and bedroom share one room. These are usually small dwellings, although their sizes can vary. 

- Apartment. This is a one-room apartment, although it is independent of the rest. They are also known as one-room apartments. Its main advantage is the low price. They are ideal for people who live alone or for couples who do not plan to start a family. 

- Apartment. It is a property located in a building with common areas or services. It may have several bedrooms and sometimes more than one bathroom.

- Duplex. The apartment has two floors, which are connected by an internal staircase. In some cases, they can be triplexes if they combine three floors, or quadruplexes if they combine up to four floors.

- Penthouse. This is the top floor of the building. They are usually the first to sell and are the most expensive due to high demand. 

What is the best orientation of the house?

North-facing houses 

North-facing houses receive natural light only in the early and late afternoon during the summer months. On the other hand, sunlight will be provided indirectly.
- Recommended if you want to keep the rooms of your home fresh.
- It will protect you from overheating.
- Well suited for excessively hot areas.
- They hardly receive heat and light.
- The cost of heating is usually more emphasized.

South-facing houses
South-facing houses receive sunlight most of the day. 
- The heating bill in winter is not so high.
- Your house is very bright.
- In the summer, the cost of air conditioning increases.
- You should equip your windows with curtains, blinds or awnings.

Houses facing the east
In houses that face the east, the sun shines from morning to noon. This is the type of lighting your property will receive every day of the year, so it is one of the preferred options for most properties when choosing the best orientation for a home.
- You save on electricity.
- The house will not overheat because the sun disappears when it is at its highest point.
- You will have to have awnings and blinds when the sun is stronger.
- In the evening, you will have less natural light.

West-facing houses
The effects of the west orientation are opposite to those provided by the east. This means your home will enjoy natural light from noon until sunset. The sunlight hitting your home will do this during the hottest hours. That is, during the day.
- Winter is a bit more pleasant.
- Energy costs for air conditioning in summer.
- Energy consumption for heating in winter.

What are the requirements for housing that is rented out for tourist purposes?

The requirements for houses for tourist purposes are easily achievable and are defined in Article 6 of Decree 28/2016 of February 2 on houses for tourist purposes, as well as:

- Have a license to use and always comply with the technical and quality conditions required for the houses.
- Rooms must have direct ventilation to the outside or courtyards and some sort of blackout system for the windows. This requirement is not met if the dwelling or the building in which it is incorporated is classified as of cultural interest and the level of protection prevents any works, modifications or interventions necessary to comply with the requirements.
- Be sufficiently furnished and equipped with the necessary equipment and facilities for immediate use and according to the number of places available.
- Have a first aid kit.
- Have physical or electronic tourist information about the area, recreation areas, restaurants and cafeterias, shops and food stores, the nearest parking lots to the house, existing medical services in the area, means of urban transport, city map.
- All houses must have complaints and grievance letters available to users, and a poster announcing this in a prominent place inside the house.
- Cleaning the house upon the arrival and departure of new customers.
- Bed linen, underwear, household items in general depending on the occupancy of the house and changing kit.
- Provide users with a telephone number where they can be contacted and immediately resolve any query or incident related to the accommodation.
- Provide users with information and operating instructions for household appliances or other devices that require it for proper use.
- To acquaint users with the internal rules for the use of premises, aggregates and equipment of housing, as well as the admission and stay of pets in the housing, smoking restrictions, as well as restricted use zones.

offers clients the purchase of a new second home (from apartments to villas) in Spain.

We offer you to choose a property according to your individual lifestyle ( classic , luxury , innovative , sustainable ) as a safe investment, profitable preservation of wealth, with further real estate management, to fully experience the joy and pleasure of owning,

All this is possible thanks to a complex, carefully designed and intelligently digitized process, which includes the following stages:

explore: the stage of familiarization with Spain and the selected region;

new developments: the stage of choosing and buying new real estate;

management: hassle-free and profitable ownership of residential real estate. 

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