The investor's guide to Spain
"Introduction
Spain attracts thousands of international real estate investors every year. Whether it is to diversify wealth, generate rental income, or prepare for retirement in the sun, investing in real estate in Spain offers numerous opportunities. However, it's important to understand the rules: taxation, legal framework, optimization strategies... This SEO guide specifically designed for real estate investment in Spain answers all your questions.
🏠 Why invest in real estate in Spain?
- Madrid: dynamic capital with favorable regulations
- Barcelona: international metropolis with great potential
- Valencia: up-and-coming city, good value for money
- Malaga & Andalusia: sun, economic growth, urban projects
- Balearic & Canary Islands: high property value
A real estate purchase in Spain can be motivated by:
- A second home
- A long or short-term rental investment
- A commercial or coliving investment
- A long-term wealth increase
⚖️ Legal framework of real estate investment
1. Accessibility for non-residents
- NIE (Foreign Identification Number)
- Spanish bank account
- Tax representative
2. Steps in the acquisition process
- Property search
- Payment of deposit (señal / arras)
- Legal due diligence
- Compromise agreement
- Notary deed
- Registration with the land registry
3. Notary vs Lawyer
The notary authenticates, but the lawyer secures the transaction.
💶 Taxation of real estate investment in Spain
1. Purchase taxes
| Property Type | Purchase Tax | Other Fees |
|---|---|---|
| New property | VAT 10% + AJD 1–1.5% | 8–12% various fees |
| Old property | ITP 6–10% depending on the region | Notary and registration |
2. Property taxes
- IRNR: 19% (EU) or 24% (non-EU)
- IBI (property tax)
- Wealth tax
- Capital gains tax on resale (IRPF + Plusvalía)
3. Tax optimization
Establishing a Spanish company (S.L.) and benefiting from the France-Spain tax treaty.
🏢 Types of real estate investments
- Long-term rental: stable market, 3–6% return
- Tourist rental: high return, strict regulations
- Renovation: potential capital gain, local incentives
- Coliving / commercial: new urban trends
⚠️ Mistakes to avoid
- Neglecting charges and urban planning
- Lack of due diligence
- No independent lawyer
- Poor evaluation of post-purchase costs
📒 Practical tips
- Hire a local lawyer
- Analyze taxation and inheritance issues
- Use property comparison websites: Idealista, Fotocasa...
🌐 Investment zones for 2025
- Madrid
- Valencia
- Alicante / Costa Blanca
- Malaga / Seville
- Balearic & Canary Islands
❓ FAQ – Investing in Spain
- Do you need to live in Spain?
- No, investment is open to everyone.
- Is mortgage financing available for foreigners?
- Yes, up to 70% financing.
- What is the average rental yield?
- 3% to 6% (long term), up to 10% (seasonal).
- Taxation on resale?
- IRPF + Municipal Plusvalía.
- Can I invest through a French company?
- Yes, but a Spanish company may be more advantageous.
📆 Conclusion
Real estate investment in Spain is a profitable strategy when well-managed. Seek the help of professionals (lawyers, tax advisors, notaries). LegalImmo Spain offers comprehensive support at every stage of your project.