Property9 oct 2026 5 min readBy Site AdministratorCosta del Sol

Buying property on the Costa del Sol: how the process works

From reservation deposit to notary, the steps, timelines, taxes and costs of buying a home in Andalusia as a US buyer, as the rules stand in October 2026.

This is a general outline, not legal or tax advice. Engage a Spanish lawyer before paying any deposit.

Who can buy, and what changed

Any foreigner can buy property in Spain; there are no restrictions on US buyers and no residency requirement. Two things changed recently. Spain's golden visa, which granted residency for purchases of €500,000 or more, was abolished on 3 April 2025. And the government's January 2025 proposal for a 100 percent surcharge on purchases by non-EU non-residents, presented to parliament in May 2025, never reached a vote and had stalled by mid-2026; as of October 2026 non-residents buy on the same terms as everyone else, though the idea could resurface. Ownership does not confer the right to live in Spain beyond the 90-day Schengen limit.

Before you start

Three things come first. Get an NIE, the foreigner's tax number, from a Spanish consulate or in Spain; nothing can be signed or registered without it. Open a Spanish bank account, which the notary and the tax office will expect to see payments flow through. And appoint an independent lawyer who does not act for the agent or developer, usually for about 1 percent of the price plus VAT; a power of attorney granted to that lawyer lets the purchase complete while you are in the United States.

Step one: reservation

When you agree a price, the agent will ask for a reservation deposit, typically a few thousand euros up to around €10,000, to take the property off the market for two to four weeks while your lawyer does due diligence. Insist that it is held in a client account and refundable if the checks fail.

Step two: due diligence

Your lawyer obtains the nota simple from the Land Registry, which shows the registered owner, boundaries, mortgages and charges; checks that the building has its first-occupation license and matches what is registered; confirms that property tax (IBI), community fees and utilities are paid up; and, for new builds, checks the developer's bank guarantee for stage payments. On rural or older properties, planning status matters and can take time.

Step three: the private contract

The contrato de arras is the binding private contract. The buyer pays a deposit, conventionally 10 percent of the price, and the parties fix a completion date, usually four to twelve weeks out. Under the common form, arras penitenciales under article 1454 of the Civil Code, a buyer who withdraws forfeits the deposit and a seller who withdraws must return double. Mortgage buyers should make the contract conditional on finance; Spanish banks typically lend non-residents a smaller share of valuation than residents, often 60 to 70 percent, and take four to eight weeks.

Step four: completion at the notary

Spanish sales complete in front of a notary, who reads the escritura, verifies identities and payments and witnesses the transfer. Payment is by banker's draft or transfer on the day. The notary then files for registration at the Land Registry, which takes a few weeks. The whole process from offer to keys commonly runs two to three months; off-plan new builds can take two years, with stage payments.

Taxes and costs

For a resale in Andalusia the buyer pays transfer tax (ITP) at 7 percent of the price, a flat rate since 2021 that is lower than most Spanish regions, with reduced rates for buyers under 35, large families and people with disabilities on main homes. For a new build bought from a developer the buyer pays 10 percent VAT plus stamp duty (AJD) at 1.2 percent. Notary and registry fees are set by tariff and usually total under 1 percent; add the lawyer's fee and, for mortgage buyers, valuation and arrangement costs. A sensible budget is 10 to 12 percent on top of the price for a resale and 12 to 14 percent for a new build. The seller pays the municipal plusvalía tax on the land's increase in value and the agent's commission. If the seller is a non-resident, the buyer must withhold 3 percent of the price and pay it to the tax office on the seller's account.

After you buy

Owners pay annual IBI property tax to the town hall, community fees in developments and, if they are non-residents, non-resident income tax on an imputed rental value even when the property is not let; for owners resident outside the EU the rate is 24 percent. Renting out short-term requires a tourist license, and several towns, including Málaga city, have restricted new licenses. Andalusia has effectively abolished its regional wealth tax, but the national solidarity tax applies to net assets above €3 million.

A caution

Every property is different and tax rules change annually. Engage a Spanish lawyer before paying a reservation deposit and a cross-border tax adviser before completion, particularly on how US reporting applies to foreign real estate and to the bank accounts used to buy it.