Authored by the expert who managed and guided the team behind the Spain Property Pack
Everything you need to know before buying real estate is included in our Spain Property Pack
Are you considering investing in Spain’s real estate market? What are the legal steps, tax implications, and cultural differences you need to understand before taking the plunge? What challenges do foreign investors typically face, and how can you overcome them?
These are the questions we hear most often from foreign investors because we’re actively connected to this market. We’ve spent time working with local agents, developers, and investors, so we know what works—and what doesn’t. That’s why we’ve written this article: to provide a clear guide that answers the questions we get asked daily.
Our goal is to help you, as a foreigner, to navigate the property buying process with confidence. If you think there’s something we missed or want more details, let us know (please do!). Your input helps us refine and improve our advice for everyone.
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1) Be aware that Spain no longer offers the Golden Visa program
The Spanish Golden Visa program is no longer available.
Back in November 2024, the Spanish government decided to put an end to the Golden Visa program, which included all investment-based residency options. This was part of a larger plan to change Law 14/2013, and the Spanish Congress gave it the green light on November 14, 2024.
Prime Minister Pedro Sánchez explained that the decision was driven by concerns over rising property prices and the misuse of the program by foreign criminals. This move was widely covered by reputable sources, signaling the program's inevitable closure.
For those considering buying property in Spain, it's important to know that the Golden Visa is no longer an option. However, Spain still offers a exciting real estate market with diverse opportunities, from bustling city apartments to serene countryside villas.
While the Golden Visa was popular among investors, its removal might actually help stabilize the property market, potentially making it more accessible for local buyers. This could be a good time to explore the Spanish property market, especially if you're interested in long-term investments.
Sources: Get Golden Visa, Global Citizen Solutions, Spainguru
We found a recent and reliable video by Balcells Group & Immigration Lawyers Spain, a law firm specialized in immigration explaining the end of the Spanish Golden Visa. This video covers the reasons for its elimination, end date, impacts on current Golden Visa holders, and alternative residency options.
2) Don’t overlook community fees in Spanish apartment complexes, as they can greatly affect ownership costs
When buying an apartment in Spain, many foreigners overlook community fees, which can greatly affect the cost of ownership.
These fees, ranging from €50 to €250 monthly in 2023 and 2024, can be even higher for luxury properties with extra amenities. Often, these costs aren't clearly explained to foreign buyers, leading to unexpected expenses. Real estate agents frequently meet buyers who are caught off guard by these fees, resulting in financial surprises and potential disputes.
Community fees cover the upkeep of shared spaces like gardens, pools, and roads. They are mandatory, and failure to pay can lead to legal action, including asset seizures or liens on the property. Understanding these fees is crucial for determining the total cost of ownership and ensuring it fits within a buyer's budget.
Many buyers are unaware of these fees, which can lead to unexpected costs. Surveys show that foreign buyers often lack awareness about these fees, causing financial surprises. Real estate agents frequently encounter buyers who are surprised by these fees, which can lead to financial surprises and potential disputes.
Community fees are essential for maintaining the quality of life in apartment complexes. They ensure that shared amenities are well-kept, which can enhance the property's value. However, not budgeting for these fees can strain finances, especially if they increase over time.
For those considering a property purchase in Spain, it's wise to ask about these fees upfront. Knowing the costs associated with community fees can help you make a more informed decision and avoid any unpleasant surprises. Being informed can prevent future headaches and ensure a smoother buying experience.
Sources: Solicitors in Spain, Health Plan Spain, Spanish Property Insight
We have made this infographic to give you a quick and clear snapshot of the property market in Spain. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Consider properties with dedicated office spaces and strong internet to cater to the growing remote work trend
Investing in properties that cater to remote work trends is a smart move.
In Spain, the number of people working from home has surged, with over 3 million doing so at least occasionally. This shift is particularly strong in areas like Madrid, Catalonia, and the Valencian Community, where teleworking is becoming the norm. These regions are not just popular for their vibrant culture but also for their growing remote work opportunities.
Internet connectivity has improved dramatically across Spain, making remote work more accessible. Many villages now have better cellphone coverage and fiber connectivity than other European countries. Take Buitrago de Lozoya, for example, where online traffic jumped by 167% between January 2020 and March 2021, showing how digital infrastructure is becoming a lifeline for remote workers.
The real estate market is buzzing with demand for homes that have dedicated office spaces. This is driven by a resilient labor market and significant immigration flows. The shortage of new housing compared to the high demand means property values are likely to rise, especially in areas favored by remote workers.
For those looking to invest, focusing on properties with strong internet connectivity and office spaces can maximize profits. The trend of remote work is not just a passing phase; it's reshaping how and where people choose to live.
Sources: CaixaBank Research, Idealista, El País
In this video, digital nomads in the Canary Islands highlight the region's excellent WiFi and remote work community, validating the trend of investing in remote-work-friendly homes.
4) Time your purchase in Spain carefully, as the property market is cyclical and prices fluctuate with economic conditions
The Spanish property market is notoriously cyclical, with prices rising and falling based on economic conditions.
Back in 2008, during the financial crisis, property prices in Spain took a nosedive, with some areas experiencing declines of up to 40%. This was a stark reminder of how economic downturns can lead to lower property prices. After the crisis, the market began to recover, but not all regions bounced back equally. Popular spots like the Costa del Sol and the Balearic Islands, which are magnets for foreign buyers, recovered faster than others. This shows how different regions can have varied trends based on their appeal to international investors.
When the economy is booming, like it was leading up to 2022, property prices generally rise. In 2022, home sales hit a peak, but by 2023, there was a noticeable drop in transactions. This pattern illustrates how economic booms can drive up prices, while recessions can lead to declines. Timing your purchase is crucial, as it can significantly impact your investment's success.
For those eyeing a property in Spain, it's essential to understand these cycles. The Costa del Sol and the Balearic Islands are not just popular for their beaches but also for their resilience in bouncing back after economic downturns. These areas often attract international buyers, which can help stabilize prices even when the broader market is shaky.
In contrast, less touristy regions might not recover as quickly, making them potentially riskier investments during economic slumps. However, they can offer more affordable options for those willing to take a chance. Understanding the local market dynamics can give you an edge in making a smart purchase.
Keep an eye on economic indicators and market trends to make informed decisions. The Spanish property market's cyclical nature means that timing is everything. Whether you're looking for a vacation home or an investment property, knowing when to buy can make all the difference.
Sources: CaixaBank Research, Housenix, Veiranda
5) Be wary of "bargain" properties in tourist hotspots, as they might have hidden problems or be in less desirable areas
When you're eyeing those "bargain" properties in tourist hotspots, be extra cautious.
In places like Andalusia, Spain, scams are not unheard of. Back in 2023, a company named Grupo 21 pulled a fast one by selling apartments on land they didn't even own. Hundreds of buyers were left high and dry, having paid up to €55,000 for homes that never saw the light of day.
Then there's the issue of structural problems. Take Almuñecar in Granada province, for example. Buyers were lured in with promises of new homes, only to find the development canceled. No refunds, just headaches, and potential legal battles over hidden defects.
Properties in less desirable areas can also be a gamble. In Sark, the real estate market is sluggish, with few transactions and stagnant prices. This makes it tough to gauge a property's true value, and you might end up with a financial dud if the property doesn't appreciate.
It's not just about the price tag; it's about what you're really getting. Some "bargains" come with more baggage than benefits, especially in popular tourist spots where demand can mask underlying issues.
So, while a deal might look sweet on paper, dig deeper to avoid costly surprises. A little extra caution now can save a lot of trouble later.
Sources: The Olive Press, Real Estate Agent Spain, Undervalued Shares
Get to know the market before you buy a property in Spain
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6) Work with a local Spanish agent for insights into market nuances that foreign buyers might miss
Thinking about buying property in Spain? Teaming up with a local real estate agent can make a world of difference.
In Madrid, for example, property prices can vary greatly between the bustling city center and the quieter outer districts. This kind of insider knowledge is crucial when deciding where to invest your money. A local agent knows these areas inside out and can guide you to the best deals.
Spain's property market is like a patchwork quilt, with each region telling a different story. In 2023, property prices on the Costa del Sol jumped by 10%, while the Valencia region saw a dip. A savvy local agent can help you navigate these trends, pointing you toward the most promising investment opportunities.
Each autonomous community in Spain has its own set of property laws, which can be a maze for foreign buyers. Local agents are well-versed in these regional regulations and can steer you through the legalities, making the buying process much smoother.
Beyond just prices and laws, local agents offer insights that aren't immediately obvious. They understand the nuances of the Spanish market, from the best neighborhoods to the quirks of local customs. This expertise is invaluable when you're making such a significant investment.
So, if you're considering buying property in Spain, remember that local knowledge is key. A real estate agent who knows the lay of the land can be your best ally in finding the perfect home.
Sources: Madrid Property Prices, Regional Market Trends, Regional Property Laws
7) Focus on properties near planned infrastructure improvements to boost investment returns as values rise over time
Investing in areas with planned infrastructure improvements can significantly boost your property's value.
When new roads, public transport, or urban projects are announced, they often make a location more accessible and desirable. This attracts more people and businesses, leading to increased property values. For instance, regions like Navarra, Aragón, and Andalucía in Spain have seen property prices soar due to such developments.
These infrastructure upgrades not only improve residents' quality of life but also make the areas more appealing to buyers and renters. This increased demand naturally drives up property values. In Spain, there's a housing deficit, with a shortage of affordable homes, making these improvements even more crucial.
Government reports suggest that infrastructure projects can help stabilize the housing market by making more areas livable and accessible. This can ease financial strain on households and create opportunities for investors to benefit from rising property values.
Experts agree that property values tend to appreciate in areas with ongoing or planned infrastructure development. Coastal regions in Spain, for example, are expected to see higher price growth due to strong demand and their established appeal, making them ideal for buy-to-let investments.
Looking ahead to 2025, forecasts indicate that home prices in Spain will continue to rise, driven by a persistent lack of properties and high demand. This trend highlights the potential for maximizing your investment by focusing on areas with planned infrastructure improvements.
Sources: Think Spain, Right Casa
8) Consider high-tourist cities for short-term rentals, but check local regulations that might restrict this rental type
Investing in short-term rentals in Spain is a hot opportunity right now.
With over 42 million tourists visiting Spain in the first half of 2024, the demand for short-term rentals is booming. This trend is expected to keep growing, making it a promising market for investors looking to capitalize on the influx of visitors.
Take Barcelona, for example. It's a top spot for short-term rentals, with properties being booked for an average of 314 nights a year and generating around €39,000 annually. However, keep an eye on the regulations, as Barcelona plans to ban short-term rentals by 2029. Investors should think ahead and consider shifting to mid or long-term rentals down the line.
Madrid is another strong contender, offering an average daily rate of $135.9. But be aware that new licenses are hard to come by, especially in central areas. This underscores the need to understand and navigate local rules to stay compliant and successful in the short-term rental game.
In both cities, the key is to stay informed about local regulations and market trends. This knowledge will help you make strategic decisions and adapt to changes, ensuring your investment remains profitable.
As the popularity of short-term rentals continues to rise, being proactive and flexible will be crucial. Consider diversifying your rental strategy to include mid or long-term options, especially in areas with stricter regulations.
Sources: Airbtics, Grand View Research, Hostaway
We made this infographic to show you how property prices in Spain compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
9) Use a "gestor" in Spain for property deals, as they navigate bureaucracy better than lawyers alone
In Spain, buying property often involves a "gestor," a local expert who can streamline the process more effectively than just a lawyer.
In 2023, international buyers made up over 21% of all property transactions in Spain, showing how crucial gestors are for foreign buyers. These professionals are adept at handling tasks like applying for residence permits and obtaining NIE numbers, which are essential for anyone looking to settle in Spain.
Real estate agencies frequently recommend gestors because of their efficiency in managing complex administrative tasks. This is especially beneficial for international buyers who might find the Spanish bureaucracy daunting. Gestors are like the secret weapon in making sure everything goes smoothly.
Legal experts agree that gestors play a complementary role in property transactions. They ensure that all the paperwork is handled efficiently, which is a big relief for buyers. Property consultants often stress the necessity of gestors in complex transactions, as they can manage the intricate administrative tasks required.
Imagine trying to navigate the maze of Spanish bureaucracy without a gestor. It would be like trying to find your way through a labyrinth without a map. Gestors make the process much less stressful, allowing you to focus on the excitement of owning a new home.
So, if you're considering buying property in Spain, think of a gestor as your go-to person for all things administrative. They are the unsung heroes who make sure everything is in order, from start to finish. Having a gestor by your side can make all the difference in your property-buying journey.
Sources: DM Properties, Dream Properties International, Think Spain, Your Destinations
10) Research regional property laws and taxes in Spain, as they vary by area and can impact your purchase
You might be surprised to learn that some regions in Spain have their own property laws and taxes, so it's crucial to research the specific area where you plan to buy.
In Spain, tax rates can vary significantly from one region to another. For instance, the 2024 Spanish Regional Tax Competitiveness Index highlights that Madrid boasts the most competitive tax rates, making it potentially more attractive for property buyers. On the flip side, Catalonia is known for its high and complex taxes, which could make purchasing property there more costly.
When it comes to property transfer taxes, the rates in Spain are anything but uniform. Depending on where you buy, you could face a tax rate anywhere from 6% to 13%. This means that if you're eyeing a property in a region with a 13% rate, your budget needs to account for this higher cost compared to a region with a 6% rate.
Inheritance tax is another area where regional differences come into play. In Catalonia, the laws are particularly detailed, with specific allowances for different groups of relatives. This complexity can sometimes lead to disputes among heirs if not properly understood and planned for.
Sources: RSM Global, Tax Foundation, Inheriting Spanish Assets
Our team found this video where tax variations in Andalucía are compared to other Spanish regions, illustrating how understanding these differences can be advantageous for buyers.
11) Understand Spain’s strict rental regulations to avoid legal issues when renting out your property
Thinking of renting out your property in Spain? Understanding the country's rental regulations is key.
In recent years, Spain has made some changes to its rental laws. For example, in 2023 and 2024, rent increases were capped at 2% and 3% to keep them in line with the Consumer Price Index. This move was aimed at preventing sudden rent hikes, which can be a relief for tenants but might be a concern for landlords looking to adjust rents with the market.
One thing to keep in mind is how rental contracts work. Contracts can automatically renew if neither party gives notice. So, if you're a landlord, you need to let your tenant know at least four months before the contract ends if you don't want to renew. Tenants have a bit more leeway, needing to notify just two months in advance.
These regulations can have a big impact on how you manage your property. For instance, the rent increase caps might limit your ability to adjust rents according to market conditions. Understanding these rules can help you avoid legal issues and make the process smoother.
Rental disputes can be a headache, often complex and time-consuming. Knowing the ins and outs of these laws is essential to navigate any potential issues effectively. It's not just about the numbers; it's about understanding the system to make informed decisions.
Sources: Veiranda, Idealista, Zavala Moscoso
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An increasing number of foreign investors are showing interest. However, 90% of them will make mistakes. Avoid the pitfalls with our comprehensive guide.
12) Consider long-term maintenance costs in Spain, as overlooking them can impact your property's profitability
When buying property in Spain, many foreigners forget about long-term maintenance costs, which can really hit your wallet.
These costs aren't just about the purchase price; they include things like water, gas, internet, and property taxes. Over a year, these can add up to a hefty sum. Imagine paying around €6,000 annually just for electricity, insurance, and community fees. And if you own a house with land, expect some surprise expenses.
Thinking of buying a fixer-upper? Be careful. Renovation costs can skyrocket with things like major licenses and tiling. What seems like a deal at first can turn into a money pit, eating into your profits.
Regular maintenance is key. Without it, you might face expensive repairs down the line. This is especially true for rental properties, where keeping the place in good shape ensures a steady income.
In Spain, the charm of a countryside villa might be tempting, but remember, the upkeep can be more demanding than an apartment. The surrounding land needs care, and that means more time and money.
So, before you dive into the Spanish property market, think about these hidden costs. They can make a big difference in your investment's profitability.
Sources: Tranio, Think Spain, Property Guides
13) Consider properties with sustainable features in Spain, as the demand for eco-friendly homes is growing
In Spain, the demand for eco-friendly homes is rapidly increasing.
People are becoming more aware of environmental issues and want to reduce their carbon footprints. This shift is causing the residential real estate market in Spain to grow, with expectations of reaching a market volume of US$6.73 trillion by 2029.
Globally, the green property market is also on the rise, with projections to hit £940 billion by 2028. This shows a strong move towards eco-friendly properties not just in Spain, but around the world. In cities like Barcelona and Madrid, there's a noticeable trend of co-living spaces that emphasize community and often include sustainable features.
People's preferences are changing, especially among younger adults. A 2021 survey found that over 90% of adults aged 18-34 consider sustainability when making purchasing decisions. This age group is particularly influential in driving the demand for eco-friendly homes.
Investing in properties with sustainable features is a smart move, as there's a growing demand for green homes in Spain. This trend is not just about individual homes but also about community living spaces that offer shared amenities with a focus on sustainability.
Sources: Statista, Beech Holdings
In this video, we can see that eco-friendly villas in Murcia are in high demand due to features like green roofs, solar panels, and high energy efficiency.
14) Consider properties in smaller towns for higher returns, as they have lower prices and growing rural tourism interest
In 2023 and 2024, there's been a noticeable shift in property investment trends towards smaller, lesser-known towns in Spain.
Take Teruel in Aragón, for instance. It's a hidden gem where luxury property prices are among the most competitive in Spain. This makes it a hot spot for first-time buyers and those looking to make high-value investments without breaking the bank. The charm of these smaller towns is not just in their affordability but also in their potential for growth.
Rural tourism is booming, especially since the pandemic. People are craving the tranquility and authenticity of the countryside. In fact, rural tourism expenditure jumped from 10.9% to 11.9% of total tourism spending between 2019 and 2023. This surge means that owning property in these areas could lead to higher returns, as more tourists seek out these peaceful retreats.
Platforms like Airbnb are also playing a role, despite some restrictions. There's a growing interest in short-term rentals in rural areas, which can be a lucrative opportunity for property owners. Imagine turning a quaint countryside home into a cozy getaway for travelers looking to escape the hustle and bustle of city life.
Living costs in these rural areas are generally lower than in urban centers, which is another draw for investors. This means that investors can enjoy higher returns as they capitalize on the lower expenses and increasing demand for rural living. It's a win-win situation for those looking to invest wisely.
Sources: CaixaBank Research, Idealista, Property Investor Today
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Spain. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
15) Shop around for the best mortgage rates in Spain, as banks often offer favorable terms to foreign buyers
Buying a property in Spain can be a smart move, especially if you understand the mortgage market.
In 2023, one in three foreign buyers in Spain used a mortgage, while others paid in cash. This trend shows that many are taking advantage of the mortgage options available. Spanish banks often offer interest rates between 2-4%, which is quite appealing for long-term investments. However, foreign buyers tend to take out mortgages that are 19% higher than those of local Spaniards, suggesting they might be purchasing more expensive properties.
Shopping around for the best mortgage rates is crucial. Different banks have different terms, and understanding these can lead to better financial decisions. For example, fixed-rate mortgages are popular among foreign buyers because they offer stability. Real estate agents and financial advisors often stress the importance of comparing offers from various banks.
Spanish banks are known for offering favorable mortgage terms to foreign buyers, but it's essential to do your homework. By comparing different banks, you can find the best rates and terms that suit your needs. Some banks might even offer special deals for foreigners, so it's worth asking around.
Understanding the local market can give you an edge. For instance, knowing that foreign buyers often go for higher-value properties can help you negotiate better terms. It's all about being informed and making the most of the opportunities available.
So, if you're considering buying a property in Spain, take the time to explore your mortgage options. With the right approach, you can secure a great deal and make a sound investment.
Sources: CaixaBank Research, Idealista, Spain Easy
16) Negotiate prices in Spain, as sellers often expect bargaining, so don’t accept the first offer
In Spain, bargaining is a cultural norm, especially in real estate.
Even though property prices rose in 2023 and 2024, there's still room to haggle. In Madrid, for example, buyers often snag a 5% discount, showing that sellers expect some back-and-forth.
Real estate agents often see buyers negotiating, and it's common to adjust prices for things like incorrect square meter listings. This back-and-forth is just part of buying a home here.
Foreign buyers are getting in on the action too. With more international purchases in 2022, it's clear that knowing how to negotiate can score you a better deal.
Understanding that Spanish sellers expect negotiation can be your secret weapon. So, don't settle for the first price you hear.
Sources: Moving2Madrid, YouTube
17) Build a network in Spain to access property opportunities often shared through word-of-mouth and personal connections
In Spain, locals often buy property through word-of-mouth and personal connections.
Imagine you're in a small Spanish town, sipping coffee at a local café. You might overhear a conversation about a house for sale, a common way properties change hands here. Many transactions happen off-market, so building a network can be your secret weapon. Locals and expats alike share stories of finding their dream homes through friends or acquaintances.
Expats have been a significant part of the Spanish real estate scene, consistently making up over 10% of purchases since 2013. In 2023, expats accounted for 15% of property purchases, highlighting the importance of personal networks. Real estate agents often stress that knowing the right people can lead to opportunities not found online.
In Spain, fewer properties are listed on public platforms compared to other countries. This means many deals are sealed through personal connections. If you're considering buying property here, think about expanding your social circle. Attend local events, join community groups, and engage with the locals to tap into this hidden market.
According to a study by BBVA Research, the residential sector's recovery in 2025 is partly due to demand facilitated by personal networks. This shows how deeply ingrained these practices are in the Spanish property market. Personal connections can significantly influence your buying experience.
So, if you're eyeing a property in Spain, remember that the best deals might not be on the internet. Instead, they could be just a conversation away. Embrace the local culture, and you might find yourself with a new home and a few new friends.
Sources: BBVA Research, Homes Abroad, Iberian Tax
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.