Hola, I’m Agne from Real Estate Andalusia. This guide is a clear, step-by-step look at buying property in Spain, written for first-time buyers and anyone purchasing from abroad. In simple English, I explain what to check before you reserve, how proper due diligence works, the real costs in Andalucía, rules on holiday lets, and the taxes many people forget when selling later. Read this first to avoid costly mistakes and move from offer to keys with confidence.
1) Before you reserve: set yourself up properly
Talk to an independent lawyer first. A short call before you fly can save weeks later. They’ll help you decide whose name(s) should go on the title, how that affects inheritance and future tax, and whether a simple purchase in your personal name is best or if a different structure makes sense.
Have your anti-money-laundering (AML) basics ready:
- Photo ID (passport).
- Recent proof of address (utility bill or bank statement).
- Source of funds (salary slips, tax return, savings or investment statements).
Spain’s AML law obliges real-estate professionals and lawyers to check this; it’s normal and it’s the law.
NIE number. Every foreign buyer needs a NIE (foreigner ID) on the deed; your lawyer can obtain it for you or you can apply at a Spanish consulate. Without it, completion can’t happen.
Power of Attorney (POA). If you won’t be in Spain for every step, a POA lets your lawyer sign the private contract, completion deed, set up utilities, and even open a basic account for bill payments on your behalf.
2) Reservation & due diligence: what a proper check looks like
Once a reservation takes the home off the market, your lawyer runs layered checks (usually 2–4 weeks):
- Land Registry (Nota Simple). Confirms the seller’s ownership and reveals mortgages, liens, easements or embargos. You should always see this before paying serious money.
- Town hall planning. Verifies the building licence and that the built reality matches what’s authorised. Ask about the Licence of First Occupation (LFO) (or equivalent), which proves the home is fit for living and helps with utilities and mortgages.
- Community of Owners. Review the statutes and recent AGM minutes for planned works, arrears and—crucially—tourist-rental rules. Spanish communities can restrict or ban holiday lets with a 3/5 vote (and courts have backed this).
- Bills & local taxes. Your lawyer checks IBI (council tax), rubbish, and utilities are up to date.
Buying off-plan? Stage payments must be protected by a bank guarantee or insurance so your deposits are refundable if the build isn’t delivered on time. Don’t transfer any stage payment until your guarantee is in place.
3) Freehold vs leasehold: what you’re really buying
Freehold (most common in Spain)
You own the property forever. You can live in it, rent it, sell it, mortgage it, and leave it to your heirs.
- Flats/townhouses: you own your unit plus a share of the common parts (stairs, roof, pool, gardens). That share (cuota de participación) sets your community fees and vote.
- Villas/detached houses: you own the land and the building. If the villa sits in a community, there will be shared rules/fees for roads or facilities.
Leasehold or similar rights (rare here)
Classic UK-style leaseholds are unusual. If you see something similar, it’s usually one of these and needs extra checks:
- Surface right (derecho de superficie): you own the building for a set term, not the land.
- Administrative concession: time-limited use granted by a public body (e.g., marina berths).
- Usufruct: right to use the home without owning the title (common in inheritance splits).
Ask your lawyer, briefly: Is it freehold? If not, what is the term, fees, and expiry? Any limits on rentals, resale, or mortgages?
4) What it really costs to buy in Andalucía in 2025
Resale homes
- Transfer Tax (ITP): 7% of the price (Andalucía applies a flat 7%).
- Notary, Land Registry & legal: allow ~1–3% combined (varies with price and complexity).
New-build (first delivery from a developer)
- VAT (IVA): 10% on residential homes bought from a developer.
- Stamp Duty (AJD): 1.2% in Andalucía on the deed.
- Notary, Land Registry & legal: again, budget ~1–3%.
If you take a mortgage: since late 2018 the lender pays the mortgage stamp duty (AJD) on the loan deed, not the borrower.
Policy watch: Spain has floated new measures (e.g., a proposed 100% purchase tax on non-EU buyers) but these would need parliamentary approval and are not law at the time of writing. Always ask your lawyer for the latest.
5) Selling later: the taxes most people forget
- Capital Gains Tax (CGT) for non-residents: a flat 19% on the gain. (Residents use a progressive savings scale; non-residents pay a fixed 19% on gains from property.)
- 3% withholding at completion (non-resident sellers): the buyer must retain 3% of the price and pay it to the Tax Agency (Form 211). The seller then files Form 210 to settle the final CGT and reclaim any excess.
- Municipal “plusvalía” (IIVTNU): a local tax on the land’s value increase; since 2021 there are two calculation methods and you can use the cheaper one (and if there’s no increase, no tax). Your lawyer will run both figures.
6) Paperwork that makes life easier
POA & NIE: sort them early
A NIE (foreigner ID) is required to appear on the deed and to deal with taxes; you can apply via the EX-15 form at a Police immigration office in Spain or through a Spanish consulate abroad. Your lawyer can also request it on your behalf if you grant a Power of Attorney (POA). A POA signed before a Spanish notary is fast; doing it abroad usually adds sworn translation and apostille steps. Getting POA + NIE done on your first visit keeps the whole timeline smooth.
Bank account (Andalucía): set up direct debits
Open a Spanish bank account once you have the NIE and place small funds for IBI (council tax), rubbish, water and electricity. In Andalucía (e.g., Málaga), the town hall encourages direct debit (domiciliación) for local taxes; it’s the simplest way to avoid missed payments after completion. We also take final meter readings and switch utilities into your name on the day.
Holiday-let plans: verify building rules and local law
Do not assume tourist rentals are allowed. Communities of Owners can now prohibit or restrict short-term lets with a 3/5 majority under the Horizontal Property Act as clarified by Spain’s Supreme Court, so we always read the statutes and recent AGM minutes, and get written confirmation from the administrator. Separately, Andalucía requires registration (VFT) and minimum standards for viviendas con fines turísticos. And note how Barcelona plans to phase out tourist-flat licences by 2028, policy can be stricter in big cities. Check both the building rules and the local rules before you buy.
7) Common red flags we catch for buyers
- Built area vs deed/licence. Your lawyer compares the escritura, Catastro and building licence. If the square metres don’t match, parts may be unregistered or illegal. Spain pushes for Catastro–Registry “graphic coordination”, so this should be fixed before you sign.
- Rural homes: AFO vs LFO. In Andalucía an AFO is only an administrative recognition (basic utilities may be allowed), not full planning compliance. A true LFO (Licence of First Occupation) is different and often needed for mortgages and tourist use. Your lawyer confirms the status with the town hall.
- Tourist letting rules. Do not rely on “great for Airbnb”. Your lawyer reviews community statutes and AGM minutes, and checks local policy (some places freeze or restrict VUT licences). Rules can change by vote, so get written confirmation.
- Debts attached to the property. Your lawyer obtains certificates showing community fees, IBI and utilities are paid. Community arrears (year of sale + three previous) can chase the new owner; IBI debts follow the property.
- Off-plan deposits without a guarantee. Each stage payment must have a bank guarantee/insurance in your name. Your lawyer confirms the guarantee before you transfer funds.
- Coastal Law limits. If the plot sits in Ley de Costas zones (public domain or protection strips), there may be strict use/works limits. Your lawyer checks coastal maps and any concessions.
- Flood risk. Your lawyer reviews official flood maps for river/sea risk and advises how it affects insurance, works and valuation.
- Wrong use class. A unit registered as commercial (local) is not a legal dwelling (vivienda) until a change-of-use is licensed and registered. Your lawyer verifies the current use and feasibility of conversion.
- Sitting tenants/occupants. If there is a tenant, the lease survives the sale and you step in as landlord (minimum terms under LAU apply). Your lawyer reviews the contract and deposits.
- Energy Performance Certificate (EPC). An EPC is compulsory to market and sell. If missing, or very poor, your lawyer will require it and you can use the rating in negotiations.
- Mortgages or embargoes not cancelled. Any registered charge must be cancelled by deed and erased at the Registry. Your lawyer holds back funds (retention) until the cancellation is complete.
- Easements/rights of way. Registered servidumbres (paths, pipes, power lines) can restrict fences, planting or extensions. Your lawyer reads the nota simple for burdens.
- “Reference value” tax trap. Since 2022 the tax office can use Catastro’s reference value to calculate ITP/AJD even if your price is lower. Your lawyer checks it in advance to avoid unexpected tax.
- Skipping Registry basics. A fresh nota simple reveals ownership, mortgages, embargoes, usufructs and easements. Your lawyer always orders it at the start.
- Catastro/Registry mis-alignment. Names, plot IDs and coordinates must align. If not, your lawyer will regularise (or make completion conditional) to avoid future blocks on works, financing or resale.
8) How we can help (and keep you safe)
At Real Estate Andalusia we combine local agency work with a belt-and-braces legal process:
- Pre-screen listings for title, planning and rental-rule risks.
- Coordinate your NIE, POA and notary appointments.
- Full due diligence (Land Registry, town-hall files, LFO, community rules, utilities).
- Off-plan protection: we won’t let you transfer stage payments without the proper bank guarantee in your name.
- Total transparency: we disclose the good and the bad so there are no surprises.
If you want me to stress-test a property you’re eyeing or to run a bespoke search with your budget and lifestyle in mind, tell me what you’re after here: http://tinyurl.com/find-me-a-property-form
Thinking of selling? https://realestateandalusia.es/sell-property-in-andalusia-spain/
Long-term or winter rental? https://realestateandalusia.es/long-term-rent-property-in-andalusia-spain/
You can also email info@realestateandalusia.es, call/WhatsApp +34711032640
