Foreigners need to take a series of steps to buy a house in Spain, starting with hiring a specialist, applying for a NIE (Foreigner Identification Number), to opening a bank account.
More and more foreigners are deciding to purchase property in Spain, treating it as an investment, a retirement place, or a holiday home to enjoy the climate, food, and lifestyle. However, foreigners need to go through a series of steps to acquire property in Spain, starting with hiring a specialist, applying for a NIE (identification card), opening a bank account in Spain, paying a deposit to reserve the property, all the way to its appraisal.
Utilize the assistance of a specialist
Hire a real estate agent and a lawyer who will guide you through the entire purchase process, which will allow you to avoid the need to travel and will help you in handling all the formalities. Although this is not mandatory, we recommend employing such individuals.
Make sure you have access to financing
Banks specializing in serving international customers, such as CaixaBank, can conduct this analysis and confirm the feasibility of the transaction within 72 hours through their online platform, without the need for translation. Other banks, such as Sabadell and BBVA, also specialize in transactions with foreigners.
Apply for a NIE number (Foreigner Identification Number)
All potential foreign buyers must apply for a Foreigner Identification Number (NIE), which will be used to identify them in Spain. If necessary, an advisor can handle the formalities associated with obtaining the NIE number.
Open a bank account in Spain
Opening a bank account in Spain is crucial as all fees and taxes associated with the purchase transaction must be settled through this account. There’s no need to travel to set up an account if you reside in one of the 15 qualifying European countries, such as Austria, Germany, Belgium, Denmark, Italy, Norway, Luxembourg, Netherlands, Finland, France, Ireland, Poland, Portugal, Sweden, Switzerland or the United Kingdom.
If you decide to set up the account personally, you can do so without the need to travel by granting power of attorney, which will enable another person to visit the bank branch on your behalf. For this, you will need an official translation into Spanish and a certified color copy of your ID or passport (i.e., with a Hague Apostille seal confirming authenticity). The required documentation includes a passport or ID, Tax Identification Number (TIN), and proof of business operations and income level.
Verify the technical condition of the property
It’s recommended to check the condition of the property before making a purchase. You can hire a company specializing in conducting professional inspections to do this. Additionally, you can ask the person responsible for handling the formalities in Spain to obtain a “nota simple registral”, a document containing all the information regarding the property.
Pay a deposit to reserve the property
Secure the property by making a deposit, which usually amounts to 10%. However, bear in mind that this deposit may be forfeited if the transaction does not go through for reasons independent of the seller. Conversely, if the seller backs out of the deal, they are obligated to return double the amount of the deposit.
Gather the documents needed for a mortgage loan
If you opt for a mortgage loan, it will be necessary to gather documents that allow the bank to assess your financial condition. Check what documents are required by banks to conduct an analysis of your financial transaction here.
Appraise the home to know its actual value
The next step is to entrust the appraisal of the property to a company specializing in such assignments before applying for a mortgage loan, to learn the actual value of the property.
Sign the preliminary agreement and find a notary
The penultimate action is signing the preliminary documents, followed by a 10-day reflection period (14 days in Catalonia) to clarify any uncertainties with the chosen notary, before signing the mortgage loan agreement.
Sign the purchase agreement and the mortgage loan agreement
Finally, after completing all the above steps, it’s time to sign the purchase agreement and the mortgage loan agreement in the presence of a notary. The purchase agreement obliges the seller to transfer the property in exchange for a previously agreed amount of money, so if either party breaches the contract, there may be consequences.