A Step-by-Step Guide to Buying Property in Spain as a U.S. Citizen

By Vivi Real Estate | 19 de May de 2025 |

Spain has long been a favored destination for U.S. citizens seeking a second home, investment property, or a change of lifestyle. Whether you're drawn to the vibrant culture of cities like Madrid and Barcelona, the serene beaches of Costa Brava, or the picturesque landscapes and real estate Costa del Sol opportunities in Andalusia, owning property in Spain is an achievable goal. This guide provides a clear, actionable roadmap to navigate the Spanish property market.

Step 1: Obtain Your NIE (Número de Identificación de Extranjero)

Before initiating any property transaction in Spain, securing a Número de Identificación de Extranjero (NIE) is mandatory. This tax identification number is essential for all significant financial activities, including purchasing property, opening a bank account, and paying taxes.

How to Obtain an NIE:

• In Spain: Apply at the local police station's Foreigners' Office. Bring your passport, a completed application form (EX-15), and a document stating the reason for your NIE request.
• In the U.S.: Apply at the nearest Spanish consulate. The process may involve submitting forms by mail or scheduling an appointment.
  

The NIE application process typically takes a few days to several weeks, so plan accordingly.

Step 2: Open a Spanish Bank Account

A Spanish bank account is necessary for managing property-related transactions, including deposits, mortgage payments, and utility bills.

Required Documents:

• Valid passport
• NIE
• Proof of address (e.g., utility bill)
  
• Proof of income or employment
  

While some banks may offer English-speaking services, it's advisable to choose a bank with experience handling accounts for non-residents.

Step 3: Define Your Property Criteria

Spain offers a diverse range of properties, from urban apartments to rural fincas. Consider the following factors:

• Location: Coastal areas, cities, or countryside
• Property Type: Apartment, villa, townhouse, etc.
• Purpose: Primary residence, vacation home, rental investment
• Budget: Include additional costs like taxes, notary fees, and maintenance

Researching online property portals and consulting with local real estate agents can help narrow down your options.

Step 4: Hire a Qualified Spanish Lawyer

Engaging a lawyer (abogado) specializing in Spanish property law is crucial. They will:

• Verify the property's legal status
• Review contracts and agreements
• Ensure compliance with Spanish regulations
• Represent your interests during negotiations

A reputable lawyer can prevent potential legal issues and ensure a smooth transaction.

Step 5: Explore Financing Options

While it's possible to purchase property in Spain with cash, many buyers opt for financing.

Mortgage Options for Non-Residents:

• Spanish Banks: Typically offer loans up to 60-70% of the property's value. Requirements include proof of income, a good credit history, and a Spanish bank account.
• U.S. Banks: Some U.S. banks may provide international mortgages, but terms and availability vary.
  

It's advisable to consult with financial advisors to determine the best financing option based on your circumstances.

Step 6: Conduct Due Diligence

Before making an offer, ensure the property is free from legal encumbrances.

Key Checks:

• Land Registry: Confirm the seller's ownership and any existing debts or charges.
• Zoning Laws: Verify that the property complies with local planning regulations.
• Building Permits: Ensure all renovations or constructions have the necessary approvals.

Your lawyer will assist in obtaining and reviewing these documents.

Step 7: Make an Offer and Sign the "Contrato de Arras"

Once you've identified a property:

• Make an Offer: Your lawyer or real estate agent can present a formal offer to the seller.
• Contrato de Arras: Upon acceptance, both parties sign this preliminary contract, which includes a deposit (typically 10% of the purchase price). This agreement outlines the terms and conditions of the sale.

Be aware that if you back out after signing, you may forfeit the deposit. Conversely, if the seller withdraws, they must refund double the deposit amount.

Step 8: Finalize the Purchase at the Notary

The final step involves signing the Escritura de Compraventa (deed of sale) before a notary.

Required Documents:

• Valid passport and NIE
• Proof of deposit payment
• Mortgage documents (if applicable)
• Proof of property insurance

After signing, the notary will register the property in the Land Registry, officially transferring ownership.

Step 9: Pay Taxes and Fees

Be prepared for additional costs beyond the purchase price.

Common Expenses:

• Transfer Tax (ITP): For resale properties, typically 6-10% of the purchase price.
• VAT (IVA): For new properties, usually 10%.
• Stamp Duty (AJD): Approximately 1.5%.
• Notary Fees: Around 0.5-1% of the purchase price.
• Land Registry Fees: Between 0.5-1%.
• Legal Fees: Typically 1% of the purchase price.

These costs can add up to 10-15% of the property's value.

Step 10: Manage Ongoing Property Obligations

After purchasing, you'll have ongoing responsibilities:

• Property Taxes: Annual taxes like the Impuesto sobre Bienes Inmuebles (IBI).
• Community Fees: If the property is part of a community, there may be monthly or annual fees.
• Utility Bills: Set up and maintain services such as electricity, water, and internet.

Hiring a property management company can assist with these tasks, especially if you're not residing in Spain full-time.

Additional Considerations for U.S. Buyers

• Tax Implications: Understand both U.S. and Spanish tax obligations. The U.S. taxes its citizens on worldwide income, so consult with a tax professional experienced in international real estate.
• Currency Exchange: Be mindful of exchange rates when transferring funds. Using a currency exchange service can offer better rates than traditional banks.
• Inheritance Laws: Spanish inheritance laws differ from U.S. practices. It's advisable to have a will that complies with Spanish regulations.

Conclusion

Purchasing property in Spain as a U.S. citizen is a feasible and rewarding endeavor with proper planning and professional guidance. By following these steps and consulting with legal and financial experts, you can navigate the process confidently and secure your Spanish property investment.

If you need assistance with any part of the process—from finding a reputable lawyer to exploring financing options—Vivi Real Estate is here to help. Our team specializes in guiding international buyers through every step of their real estate journey. Your dream of owning property in Spain is within reach!