Spain Real Estate FAQ for Foreign Buyers: 25 Questions Answered

Spain remains one of the most frequently asked-about markets by foreign buyers in Europe, in part because the residential market has stayed active after the Golden Visa real estate route closed on April 3, 2025, and in part because regional differences in transfer tax, autonomous-community surcharges, and the new housing law have created real complexity. The answers below cover the questions foreign buyers ask most often when researching Spain in 2026.

Can foreigners own property in Spain?

Yes, Spain places no nationality or residency restriction on real estate ownership for residential or commercial property, and foreigners hold full freehold rights identical to Spanish citizens. The general rule under the Spanish Civil Code Article 27 grants foreigners the same private-law rights as nationals. There are very limited restrictions in security-sensitive zones near military installations under Law 8/1975 on Zones of National Defence Interest, requiring authorization in border areas.

What is an NIE and is it required?

An NIE (Número de Identidad de Extranjero) is the foreigner identification number issued by the Ministry of the Interior under Royal Decree 557/2011, and it is required for any tax-relevant transaction including buying property, signing a mortgage, paying transfer tax, and registering at the Land Registry. NIE is obtained either at a Spanish consulate abroad or at a Foreigners Office (Oficina de Extranjería) or police station in Spain. Processing takes 1 to 4 weeks depending on consulate or office workload.

Is the Spain Golden Visa still available?

No, the residential real estate route to the Spain Golden Visa was abolished by Organic Law 1/2025 of January 1, 2025, with effect from April 3, 2025. The Golden Visa framework had been created by Law 14/2013 and offered residence permits to foreigners investing at least EUR 500,000 in Spanish real estate. Other investment routes remain (EUR 1 million in shares, EUR 2 million in government bonds, business projects of general interest), and digital nomad visas under the same 2013 framework continue. Foreigners who held a real-estate-based Golden Visa before April 3, 2025 can renew under transitional rules.

What is the ITP and how much is it?

ITP (Impuesto sobre Transmisiones Patrimoniales) is the property transfer tax on resale (second-hand) homes, regulated by Royal Legislative Decree 1/1993 and set at the autonomous-community level. Rates in 2026 range from 4 percent (Madrid for limited cases, Basque Country reduced rates) to 11 percent (Comunidad Valenciana progressive top tier), with the most common rates: Andalusia 7 percent, Madrid 6 percent, Catalonia 10 percent, Valencia 10 to 11 percent, Balearic Islands 8 to 13 percent progressive, Canary Islands 6.5 percent. The tax is paid by the buyer within 30 business days of signing the public deed.

What taxes apply when buying a new build?

New-build purchases from a developer are subject to IVA (VAT) at 10 percent on residential property and 21 percent on commercial property, regulated by Law 37/1992 on VAT. AJD (Actos Jurídicos Documentados) stamp duty applies in addition at rates set by each autonomous community, typically 0.5 to 1.5 percent. The combined burden on a new build is therefore higher than on a resale in most regions, although the AJD rate is lower than the resale ITP rate.

What is plusvalía municipal?

Plusvalía municipal is the local capital gains tax on the increase in cadastral value of urban land at the time of transfer, regulated under Royal Legislative Decree 2/2004 on Local Treasuries and the 2021 reform via Royal Decree-Law 26/2021. The tax is paid by the seller and varies by municipality. After the Constitutional Court declared the prior calculation method unconstitutional in October 2021, the current rules allow the taxpayer to choose between an objective method (based on cadastral value and holding period) or the actual capital gain. The seller pays within 30 days of the transfer.

How are non-resident owners taxed on rental income?

Non-resident landlords pay IRNR (Impuesto sobre la Renta de no Residentes) under Royal Legislative Decree 5/2004 at 19 percent of net rental income for EU and EEA residents (deductions allowed) and 24 percent of gross rental income for non-EU residents (no deductions). Quarterly filings (Modelo 210) are due in April, July, October, and January for the prior quarter's rents. Tax treaties may reduce or eliminate Spanish withholding.

Is there imputed income tax even if I do not rent?

Yes. A non-resident who owns Spanish residential property pays imputed income tax annually under IRNR even if the property is empty or used only personally. The taxable base is 1.1 percent of the cadastral value (if the value was reviewed in the last 10 years) or 2 percent otherwise, taxed at 19 percent (EU/EEA) or 24 percent (non-EU). Filed annually on Modelo 210, due by December 31 of the year following the tax year.

What is the wealth tax?

The Impuesto sobre el Patrimonio is a net-wealth tax under Law 19/1991, set with significant autonomous-community variation. The state default exempts the first EUR 700,000 of net wealth per person (with an additional EUR 300,000 for the primary residence for residents), with progressive rates from 0.2 to 3.5 percent. Madrid and Andalusia apply a 100 percent bonification reducing the tax to zero for residents. Other regions (Catalonia, Valencia) levy the full progression. Non-residents file based on Spanish-situs assets.

What is the solidarity tax on large fortunes?

The Impuesto Temporal de Solidaridad de las Grandes Fortunas was created by Law 38/2022 and applies to net wealth above EUR 3 million (with EUR 700,000 personal exemption applied first), with progressive rates from 1.7 to 3.5 percent. It was introduced to neutralize the wealth-tax bonifications offered in some regions. As of 2026 it has been confirmed as permanent. Wealth tax paid in the same region is deductible from the solidarity tax.

What is Modelo 720?

Modelo 720 is an informative declaration of assets held abroad, required from Spanish tax residents under General Tax Law 58/2003 and Royal Decree 1065/2007. The threshold is EUR 50,000 per category (foreign bank accounts, foreign securities, foreign real estate). The European Court of Justice in C-788/19 (2022) struck down the disproportionate Spanish penalties; Spain replaced them in 2022 with proportionate sanctions. Non-residents do not file Modelo 720, but residents who acquire Spanish residency must file in the first year of residency.

Can foreigners get a mortgage in Spain?

Yes, Spanish banks routinely lend to non-residents at loan-to-value ratios of 60 to 70 percent (compared with 80 percent for residents). Common lenders for foreigners include Santander, BBVA, CaixaBank, Sabadell, and Bankinter. Interest rates in 2026 typically range from 3.5 to 5 percent for fixed-rate 20 to 25 year loans. Mortgage tax (AJD on the mortgage deed) is paid by the bank since the 2019 Mortgage Law (Law 5/2019).

What is the typical closing process?

A typical purchase takes 45 to 75 days from accepted offer to signed escritura pública. Steps include the reservation contract (contrato de reserva, typically EUR 3,000 to 10,000 deposit), the arras agreement (contrato de arras, with 10 percent deposit and bilateral penalty), legal due diligence including a Nota Simple from the Land Registry, NIE confirmation, mortgage approval if applicable, signing the public deed (escritura) before a Spanish notary, paying ITP or IVA plus AJD, and registering the deed at the Land Registry (Registro de la Propiedad).

Do I need to be in Spain to buy?

No. You can grant a Spanish power of attorney (poder notarial) at any Spanish consulate abroad or at a notary in your country (with apostille and sworn translation). A lawyer or trusted representative can then sign all documents on your behalf. Most buyers, however, attend the escritura signing in person to confirm the property, the price, and the keys handover.

What is a Nota Simple?

A Nota Simple is an extract from the Land Registry (Registro de la Propiedad) describing the property, its current owner, registered charges (mortgages, embargos, easements), and any pending claims. It is the basic legal due-diligence document, costs around EUR 10 to 30, and can be obtained online or in person. Always request a current Nota Simple within days of signing the arras agreement to confirm there are no surprise encumbrances.

What is the difference between escritura pública and contrato privado?

The escritura pública is the notarized public deed of sale, which is the legal title to the property once registered at the Land Registry. A contrato privado (private contract) such as the contrato de arras commits the parties but does not by itself transfer ownership. Spanish law requires the escritura pública for valid registration of ownership transfer under the Land Registry Law (Ley Hipotecaria). Always insist on the escritura pública route rather than relying on a private contract.

What is the cédula de habitabilidad?

The cédula de habitabilidad is a certificate of habitability issued by autonomous-community housing authorities confirming the dwelling meets minimum livability standards. It is required to connect utilities and is required for the sale of resale homes in most regions (the requirement varies). Catalonia, Valencia, Asturias, the Balearic Islands, the Canary Islands, Cantabria, Murcia, and Navarra mandate the certificate at sale or rental. Buyers should request the current cédula from the seller before signing.

Are there short-term rental restrictions?

Yes, and they vary substantially by autonomous community and municipality. Catalonia requires a tourist accommodation license (Habitatge d'Ús Turístic), Balearic Islands have moratoria on new licenses on parts of Mallorca and Ibiza, Andalusia requires registration as Vivienda con Fines Turísticos. Madrid, Barcelona, San Sebastián, Bilbao, and Málaga have local zoning restrictions and registration requirements. The 2023 Housing Law (Law 12/2023) gave municipalities additional powers to declare stressed-market zones and limit short-term rental licenses.

What is the new Housing Law and how does it affect foreign buyers?

Law 12/2023 of May 24, 2023 on the Right to Housing introduced rent controls in declared stressed-market zones, the concept of large landlords (gran tenedor) at 10 or more properties (5 in some zones), and stricter eviction procedures. Foreign owners are subject to the same framework as Spanish owners. The law also raised IBI (annual local property tax) surcharges of up to 150 percent on empty properties at municipal discretion. Catalonia has applied the stressed-zone framework most actively; Madrid has not.

Has Spain banned foreign property buyers?

No, but proposals have been introduced. In January 2025, the government proposed a 100 percent tax on home purchases by non-EU non-residents as part of a broader housing reform package, modeled on the Canadian Foreign Buyer Ban. As of 2026 the proposal has not been enacted into law and remains under parliamentary debate. The Golden Visa real-estate route, separately, did end on April 3, 2025 (Organic Law 1/2025).

How does Spain tax property when I sell?

Sellers pay IRPF (residents) or IRNR (non-residents) on the capital gain. Non-resident sellers face a 19 percent rate on the gain, and the buyer must withhold 3 percent of the sale price under Article 25.2 of the IRNR Royal Legislative Decree 5/2004 and remit it to the tax agency on Modelo 211. The non-resident seller then files Modelo 210 to settle the actual capital gains tax and reclaim any excess withholding within four months of the sale. Plusvalía municipal also applies at the local level.

What inheritance tax applies?

Spanish inheritance and gift tax (Impuesto sobre Sucesiones y Donaciones) under Law 29/1987 applies to Spanish-situs assets regardless of the heir's residency. Rates are set by the autonomous community where the deceased had a habitual residence or, for non-residents, where the property is located. Most regions (Madrid, Andalusia, Murcia, Galicia, Cantabria, Canary Islands, Extremadura, Castilla y León) apply a 99 percent bonification for close-family heirs, reducing the effective rate to near zero. Catalonia, Asturias, and the Basque Country apply more significant taxes.

Where can I verify a Spanish developer?

Confirm the developer's tax identification (CIF), registration with the Mercantile Registry (Registro Mercantil), and check the project's Licencia de Obra Mayor issued by the municipality. The Ministry of Housing (Ministerio de Vivienda y Agenda Urbana) maintains regional registries of urbanizations. Bektu maintains transparency profiles on Spanish developers with notes on completed projects and any litigation history. Off-plan purchases must be protected by a bank guarantee (aval bancario) or insurance policy under Law 38/1999 on Construction Planning.