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Buying a property in Spain step by step

In this article Lopez and Moreno, Spanish lawyers and Notary Public in City of London are going to summarise the necessary steps to buy a property in Spain.

It needs to be clear from the outset that any Notary Public in England and Wales, such as the Notary in the City of London at Lopez & Moreno, will be able to sign the Spanish Deed of Transfer in England thus facilitating the communication between the British citizen and the law professionals, so any references to a “Notary” in this article could mean an English notary or a Spanish notary.



For used homes

1. Transfer tax. Percentages and payment deadlines

This tax is required when buying a second-hand home. It varies from region to region and is taxed, depending on the region and the value of the property, between 6% and 13% on the value of the property stated on the deed of transfer or the cadastral reference value, whatever is the higher. As Spanish lawyers, we are familiar with the different rules in each of the Spanish Autonomous Communities and we can advise you on the rate applicable to the transaction.

Deadline for the tax to be paid: 30 working days from the day following completion of the purchase and signature of the Deed of Transfer. Payment shall be made before the relevant Tax Agency together with the necessary Transfer Tax Form, DNI/NIE, first original authorised copy and simple copy of the Deed of Transfer.

2. Plusvalia tax.

This is a tax payable to the Local Authority that taxes the increase on the value of the land where the property is located from the previous transfer. The responsibility for payment lies on the vendor unless agreed otherwise.

3. 3% Withholding Tax.

When the vendor is non-resident in Spain, the buyer has a legal responsibility to withhold 3% of the purchase price and pay it to the Spanish Tax Authorities (central authority for the whole of the country) within 30 working days from completion towards the possible CGT liability of the vendor. Although the funds to pay the tax are deducted/withhold from the sale price, it is worth mentioning that is the buyer who must deal with payment of such 3% and filling the relevant Tax Form on behalf of the buyer after completion.

For new housing

1. VAT or Canarian equivalent, percentages and payment deadlines

The purchase of a new home in Spain implies the obligation for the buyer to pay VAT. The tax rate to be paid currently is 10% of the value of the sale of the home stated in the Deed of Transfer, although there is an exception when it comes to officially protected housing, which is 4%. Payment will be made to the vendor who must deposit the said amount at the Tax Agency.

2. Stamp Duty Land Tax, percentages and payment deadlines

This is tax payable to the Regional Tax Authority when buying a newly built property. The amount, again, varies depending on each region, but normally oscillates between 0.5% -1.5% calculated on the amount of the value stated on the Deed of Transfer.

Deadline for the tax to be paid: 30 working days from the day following completion of the purchase and signature of the Deed of Transfer. Payment shall be made before the relevant Tax Agency together with the necessary Stamp Duty Land Tax Form, DNI/NIE, first original authorised copy and simple copy of the Deed of Transfer.



The IBI is similar to the council tax in the UK, it is payable to the Local Authority and the amount to be paid varies depending on the Town Hall, it is determined from the cadastral value of the home.

In all cases, a percentage is established based on the cadastral value that ranges between 0.4% and 1.10% in urban areas and between 0.3% and 0.90% in rural areas. As Spanish lawyers we can make enquiries at any town hall to find out the specific percentage that will be applied to you and therefore the final amount that you will be expected to pay.

The time of payment as well as the method of payment varies from each town hall, but it is usually paid in one or two instalments every year and it can usually be paid by direct debit set up on a bank account in Spain.

Non-Residents Income Tax

When the buyer is non-resident in Spain, whether the property is rented or not, every year the property owner must file a Spanish Non-Residents Income Tax Form and pay the tax due. If the property is not rented, this should be a nominal amount, if the property is rented, the Tax Return must be filed and the tax due must be paid every quarter declaring the rents received less deductible costs and expenses.



Our Notary in the City of London can sign the Deed of Transfer in England, alternatively in our capacity of Spanish lawyers, we can travel to Spain to sign it before a Notary in Spain. In Spain the notarial fees are set by regulations and they will depend on the value of the transaction, number of pages of the Deed of Transfer, etc. It is usually agreed that the buyer will pay the notarial fees for the Deed of Transfer, however that it not strictly what the law says, so it is important to agree in the contract who will be responsible for payment of the notarial fees on completion.

Land Registry

These are the fees charged by the Land Registry’s for registering the transfer of the property under the name of the buyer and issuing an office copy entry under the name of the new proprietor. The prices are set by regulations and their amount depends on the price of the home.

Our Spanish lawyers will assist with making an application at the Land Registry to register your home under the new names once the Deed of Transfer has been signed before our Notary in the City of London or in Spain and the Tax Forms are filed.

Real-estate agency

This amount is set by the real estate agency, normally it can be a percentage of the sale price or a fixed amount. In most cases is paid by the vendor, however there may be more than one estate agency involved and if the buyer employs an estate agent assisting with finding a property, may also charge a finders’ fee.



It is highly recommended to obtain home insurance from the time of purchase, no different as to how things work in the UK.

Residents’ Association fees/ Residents’ Management fees

When the home has communal areas together with other owners or it is an apartment in a building, there is a residents’ association/management fee to pay for the service or maintenance of common areas such as: lift, pool, gardens, etc. In the UK is known as “service charges”. There is always an administrator who may well be Spanish lawyers who take care of everything.


The costs of utilities such as water, electricity and Local Authority rubbish collection fees will be borne by the new buyer from completion, as is the case in the UK.

* Above mentioned IBI tax (similar to the council tax in the UK).


For non-Spanish citizens, buying a home in Spain is a fairly simple procedure, you just have to have the NIE.


It is a personal tax code granted for life and it is essential to carry out any type of economic transaction in Spain, file Tax Forms and pay the relevant taxes required to register the transfer of the property.

Our Spanish lawyers can help you apply for it in London who can either attend the relevant office with you personally or attend without your presence while using a Power of Attorney which can be prepared and signed by our Notary in the City of London.

Permit from the Ministry of Defence

If a non-EU citizen, such as British citizens, is buying a plot of land classified as rural land in certain areas of the country such as the Balearic Islands and the Canary Islands, it is necessary to obtain a permit from the Ministry of Defence to authorise the purchase of the plot of land. Our team of Spanish lawyers can assist you and advise you with the application.

Bank account

It is not mandatory to have a bank account in Spain. However, it is recommended because all the expenses related to the purchase and sale of the home, as well as future bills, must be paid in Spain. For these purposes it has recently been mandatory to provide your tax number (National Insurance Number) and ‘know your client’ documentation of your country due to the banking policy on money laundering regulations.


A) Budget and payment.

  • Consider how much money is available to you and how much are you going to invest. Also consider exchange rates as they fluctuate daily.

  • Payment by cash or mortgage.

Cash: payment will be by bankers’ draft or bank transfer in favour of the seller on the same day of the signing of the Deed at the Notary.

Mortgage: Usually banks are reluctant to offer mortgages to non-residents who obtain their income outside Spain, therefore this option must be limited for UK residents.

B) Type of housing:

New, second hand or social housing (VPO).

New: these are newly built homes that have not been transferred to third parties since their construction.

Second-hand: these are those homes that have already been inhabited by other people. Within second-hand homes, different states of habitability can be found.

Social housing (VPO): these are usually properties with a more affordable price and the majority are intended for the population with difficulties in accessing housing, they have economic advantages, but at the same time they must meet some personal and economic requirements in addition to some obligations.

C) Search for the house and check legal situation.

1) Copy of Title Deed.

The copy of the Deed will allow us to know the personal data of the seller of the home, the description of the property being sold, whether it is urban or rural land, cadastral reference, etc. As Spanish lawyers, again, we are in a good position to assess this copy, advise on it.

2) Office copy entry.

The office copy entry, like in the UK, is a document issued by the Land registry that summarises who the owner is, if there are charges or encumbrances and the limitations of use that the home may have (easements). As Spanish lawyers we have the knowledge to apply for this document from the Land Registry and advise you on the results obtained.

3) IBI receipt

Asking for the latest IBI receipt for the property from the seller is a must. With this receipt we will know the cadastral reference of the home, many other details necessary to effect the transfer and find out if there is any non-payment of previous receipts. Whether acting for buyer or vendor, at Lopez & Moreno, Spanish Lawyers and Notary Public in London, we will contact the Town Hall to ask for a certificate confirming there are no outstanding amounts to be paid.

4) Identify if the surface area at the Cadastral Registry matches the description at the Land Registry, if it does not, it may be due to an extension built on the property without building licence or other planning issues that may affect the property.

At Lopez & Moreno Associates our team of Spanish Lawyers will be able to advise you on the planning situation of the property and make further enquiries should they be necessary depending on the result of the initial searches.

5) Request licence of first occupancy or habitability certificate.

6) If any planning issues are identified, request a certificate issued by the planning department of the Town Hall to confirm that the property complies with the current planning regulations and that there are no outstanding enforcement planning procedures against the property.

7) Contact the administrator of the Residents’ Association/Management Company to verify that the property is up to date on payment of Residents’ Association fees and that there are no other issues or disputes affecting the property and the Residents’ Association. On completion it is necessary to obtain a certificate signed by the Secretary and the President of the Residents’ Association confirming that the property is up to date on payment of such management fees.

8) Request a copy of the last electricity, water and rubbish collection fees to check with the relevant suppliers that the property is up to date on payment of such bills.

9) Energy certificate

The energy certificate is essential to sell a home. This certificate reports the energy consumption and CO2 emissions of the home. It has been mandatory since 2013 and it is the seller who must request it from a certifying technician. It is valid for 10 years.

· Visit and examine the house.

Once the property has been chosen it is of great importance to decisively examine the most important aspects of the home, which may be the condition of bricks, walls, etc.

It is advisable to commission a survey to identify any structural problems or hidden defects on the property which may not be apparent.

· Compare with others.


When all the searches have been completed and after receiving a report on the result of such searches you are happy to proceed with the purchase, at Lopez & Moreno Associates, our team of Spanish Lawyers will be able to draft the relevant purchase contract to reflect the terms agreed by the parties and advise on the exchange of contracts.

Purchase contract (“contrato de arras”)

· What is it and what is it for?

The purchase contract is a private contract with the purpose of securing the transaction between buyer and seller in exchange for delivering an amount of money as a deposit. The contract will reflect both the sale price, completion date and the conditions that have been agreed upon to purchase the property.

The contract will normally contain a clause specifying that if the buyer is on breach of contract will lose the deposit, and if the vendor is on breach of contract will have to return to the buyer the deposit paid plus an equal amount as a penalty.

· How does it work

Once the contract is drafted, a day will be agreed upon for both parties to sign it. Once signed, it will be when the buyer delivers the agreed amount to the seller usually by a bank transfer.

· What deadline does it set for the sale?

In this deposit contract you must set a date to complete before the notary normally and depending on the circumstances it can be a month or two.


A) Public Deed.

It is the last procedure necessary to formalise the purchase/sale of the home. It is a deed signed before the Notary. Our Notary in the City of London if this notary has been the chosen one, will have the obligation, as a Spanish notary would have, to read and explain the entire document and all its clauses.

Once the Deed of Transfer has been signed before the Notary and the rest of the money of the sale price has been paid to the vendor the buyer acquires ownership of the home.

B) Tax Forms and payment of taxes.

Both the buyer and seller will have 30 business days to pay the taxes that correspond to them as explained in point 1 above.


A) Registration at the Land Registry

Once the Deed of Transfer is signed, the relevant Tax Forms are filed and paid, it is necessary to lodge an authorised copy of the Deed of Transfer with the supporting documentation to register the transfer of the property at the Land Registry.

B) Communication to the Cadastral Registry.

The buyer is obliged to notify the Cadastral Registry of the change of ownership of the home within a maximum period of two months from the moment of signing. You must fill out the corresponding form with the information of the new owner, the previous owner, the home and the deed of sale. The Spanish lawyers at Lopez & Moreno can do this for you. This is usually done when filling the relevant form related to the plusvalia tax on the property transfer.

C) Communication to the Residents’ Association.

It is mandatory to notify the Residents’ Association of details of the new owners. It is advisable to set up a direct debit for payment of the Residents’ Association fees.

D) Set up a direct debit for payment of IBI tax and rubbish collection fees with the Town Hall.

E) Change ownership of supplies.

Just as the change of ownership must be communicated to the Cadastral Registry, it must also be done with the supplies. To do this, you will have to provide a simple copy of the deed of sale so that they can verify that you are the new owner of the home. It is always recommended to direct debit the receipts as this will avoid possible supply cuts due to non-payments, especially if you are not at home throughout the year. To make the change you will have to go to the offices, by phone or through their website. Again, the Spanish lawyers at Lopez & Moreno can assists with this.

F) Taxes and expenses from purchase (detailed above)

They can be seen detailed in point 1B and 1D.

At Lopez & Moreno Associates, our team of experienced Spanish lawyers and notary can guide and advise you on every step of the process.

Please get in touch with us for information about our services and fees.



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