Spain isn’t just a holiday destination; for many, it is the Plan B that becomes Plan A. From the white-washed villas of the Costa del Sol to the vibrant streets of Madrid and the rustic charm of Alicante, the country offers a lifestyle that is hard to beat. The climate, culture and cost of living continue to attract buyers from across the globe.
However, purchasing property here is not without its complexities. You are spending a large sum in a different legal system, navigating bureaucracy and dealing with a different currency. Once you own the property, you also need to understand what your ownership means for residency and how long you can actually spend in your new home.
Whether you are seeking a holiday retreat, a permanent relocation or a smart investment, preparation is key.
This guide breaks down the buying process in Spain step-by-step, outlining the costs you need to budget for and the legal essentials. We also cover a critical financial factor: your currency exchange. Buying in euros while holding funds in pounds, dollars or other currencies leaves you exposed to market volatility. We explain how to manage that risk so you can buy with confidence.
Can foreigners buy property in Spain?
Yes. There are absolutely no restrictions on foreigners buying property in Spain. You do not need to be a resident to purchase a home.
However, before you can buy anything, you must obtain an NIE number (Número de Identificación de Extranjero). This is your foreigner’s tax ID number. You cannot sign a deed or even open a utility account without one.
Visas and residency in Spain
Since Brexit, UK citizens join Americans, Australians and other non-EU citizens as “third-country nationals”. This affects how long you can spend in your Spanish home:
- 90/180 Day Rule: You can spend up to 90 days in Spain (and the Schengen area) within any rolling 180-day period without a visa. This is sufficient for most holiday home owners.
- Non-Lucrative Visa (NLV): If you wish to retire to Spain, this is the most common route. It requires proof of income or savings and private healthcare but does not allow you to work.
- Digital Nomad Visa: A popular option for remote workers earning income from outside Spain.
- Golden Visa (Property Route Closed): Please note that the “Golden Visa” route, which previously offered residency for property investments over €500,000, was closed to new applicants in April 2025. Buying a home no longer automatically grants residency rights.
Why buy property in Spain?
Spain remains the number one destination for international buyers for good reason:
- Accessibility: Hundreds of flights daily from the UK, USA and major global hubs.
- Healthcare: Consistently ranked among the best in the world.
- Community: Large, established expat communities mean you rarely feel isolated.
- Investment: Rental demand remains incredibly high, particularly for holiday lets in coastal regions.
The property-buying process in Spain
Below is a typical journey for international buyers.
Define your requirements and budget Decide if your property is for holidays, rental income or relocation. At this stage, calculate your budget in both your home currency (pounds, dollars, yen, etc.) and euros so you can see your exposure to exchange rate movements.
Get your NIE number Apply for this early. You can do it via the Spanish consulate in your home country or in person in Spain.
Engage a lawyer (abogado) Never sign anything or pay a deposit without an independent lawyer checking the property registry (Registro de la Propiedad) to ensure there are no debts attached to the property.
The Reservation Contract (Contrato de Reserva) Once you find a property, you pay a small fee (typically €3,000 to €6,000) to take it off the market. This freezes the price for a short period.
The Deposit Contract (Contrato de Arras) This is the big commitment. You typically pay 10% of the purchase price. If you back out, you lose this money. If the seller backs out, they must pay you back double.
Completion (Escritura de Compraventa) This happens at the Notary’s office. You pay the remaining balance (usually via Banker’s Draft) and the Notary signs the public deed. You are now the owner.
Costs of buying a property in Spain
Spain has some of the highest buying costs in Europe. As a rule of thumb, you should budget an additional 10-12% on top of the purchase price.
- Property Transfer Tax (ITP): For resale properties. Varies by region (e.g. 10% in Alicante/Valencia, 7% in Andalucia).
- VAT (IVA): For new-build properties. Fixed at 10%.
- Stamp Duty (AJD): For new-builds only (approx 1.5%).
- Notary & Registry Fees: Approx 1-1.5%.
- Legal Fees: Typically 1% + VAT.
Why currency exchange is critical
You will need to send money at several stages:
- Reservation fee
- Initial 10% deposit (Arras)
- Final balance
- Taxes and Notary fees
- Renovation costs
Most overseas buyers underestimate the impact of exchange rate volatility. In practice, if you hold pounds, dollars, krone or any other currency, you are exposed to market movements throughout your buying timeline.
For illustration, a €300,000 property could cost:
- £254,000 at a rate of 1.18
- £267,000 at a rate of 1.12
That is a difference of roughly £13,000 purely due to currency movement – and those kinds of swings can happen while you are waiting for legal checks to complete.
How to manage currency risk
The good news is you can reduce or remove much of this uncertainty with a plan.
- Forward contract: Fix today’s exchange rate for a future payment (such as completion funds). This helps you lock in the cost of the property in your home currency and protects against adverse market moves.
- Market order / rate alert: If you are not ready to lock a rate, you can set an alert or place an order so that if the market reaches your chosen level, your currency is bought automatically.
Why use a specialist currency provider?
When buying property abroad, using a specialist can make the process simpler and more secure.
Banks can be slower and more expensive for international transfers and they typically don’t offer the same kind of proactive support around timing and risk management. With Smart Currency, you are supported by a designated account manager who can help you plan transfers around your milestones and discuss strategies like forward contracts and market orders.
Smart Currency’s brand promise is about making cross-border payments simple and secure, with clear and supportive guidance throughout the process.
Making transfers on time
Spanish property transactions rely on precise timing. The “completion” at the Notary is a formal event. If your funds (usually a Banker’s Draft) are not ready, the signing cannot happen. To help keep your purchase on track, make sure you:
- know exactly when deposits and balances are due
- allow for bank cut-off times and beneficiary checks
- have a clear plan to ensure funds arrive in euros on schedule
In summary: buying property in Spain
To make your purchase smooth, enjoyable and financially secure, it helps to understand Spain’s buying process and the real costs involved – and to plan early.
- Budget for 10-12% in fees and taxes on top of the purchase price.
- Treat currency exchange as part of your buying strategy from day one. Volatility between your home currency and the euro can significantly change the final cost.
- Use professional support (independent lawyer, currency specialist) so you can move quickly when you need to without taking unnecessary risks.
With careful planning, buying property in Spain can be both a rewarding lifestyle decision and a strong long-term investment.
Frequently Asked Questions about buying property in Spain
Is it safe to buy property in Spain? Yes, the market is highly regulated. However, never buy without an independent lawyer (abogado) who can check for illegal builds or outstanding debts on the property, as debts in Spain are attached to the property, not the owner.
Can I buy with a mortgage? Yes. Spanish banks typically lend up to 60-70% of the property value to non-residents. You will need to prove your income and pass affordability checks.
Do I need a lawyer? Yes. Unlike in some countries where a notary handles everything, in Spain, the notary acts for the government, not you. You need your own lawyer to protect your interests and conduct due diligence.
