Buying property on the Costa del Sol: the complete buyer guide

Written by Mikael Hansen, Plexo Properties. Last updated September 2026.

What buying property in Spain involves

Buying a home in Spain is a notarial process, not an exchange of contracts between two solicitors as in the UK or Ireland. The sale becomes final when both parties sign the escritura pública de compraventa in front of a notary, who checks identities and the deed and then sends it to the Land Registry. A foreign buyer needs three things before that day: an NIE, a Spanish bank account, and an independent lawyer who acts only for them.

The single most important decision is legal representation. The notary confirms that the deed is correctly drawn, but does not act as your adviser and does not investigate debts, planning breaches or licensing. That is the lawyer's job. On the Costa del Sol, where a large share of buyers are non-resident and many homes are resales or off-plan, an independent lawyer is what separates a clean purchase from an expensive surprise.

The buying process, step by step

1. Get your NIE and a Spanish bank account

The NIE (Número de Identidad de Extranjero) is your Spanish tax identification number, and nothing can be signed without it. You can apply at a Spanish consulate in your home country or at a national police station in Spain, using form EX-15 and paying the tasa modelo 790, código 012, which is 9.84 euros. Allow a few weeks. A Spanish bank account is needed to pay the deposit, the balance and the running costs such as IBI and community fees.

2. Appoint an independent lawyer

Choose a lawyer who is not connected to the seller, the developer or the agent. They will run the due diligence, review every contract before you sign, hold funds where appropriate and represent you at completion, in person or by power of attorney if you cannot attend. Agree the fee in writing at the start. Around 1 per cent of the price plus IVA is the usual range.

3. Reserve the property

Once you have chosen a home, a reservation contract (contrato de reserva) takes it off the market for a short period while checks run. You pay a reservation fee, commonly between 3,000 and 6,000 euros, which is later deducted from the price. Have your lawyer read the reservation contract before you pay, because it already sets out deadlines and forfeiture terms.

4. Due diligence

Before you commit further, your lawyer confirms the seller is the registered owner, obtains a nota simple from the Land Registry, and checks that the property is free of debts, mortgages, embargoes and community arrears. They verify that it is legally built and licensed, that the description matches the Catastro, and that IBI and utilities are up to date. On resales this is where problems surface. On new builds they confirm the developer's bank guarantee for staged payments.

5. Sign the private purchase contract

With due diligence clear, both sides sign the private purchase contract (contrato privado de compraventa), usually with a 10 per cent deposit. This is normally an arras contract under article 1454 of the Código Civil: if the buyer pulls out they lose the deposit, and if the seller pulls out they repay double. The contract fixes the price, the completion date and exactly what is included.

6. Complete at the notary

On completion day, buyer and seller sign the escritura pública before the notary, the balance is paid, and the keys change hands. If a mortgage is involved it is signed at the same appointment. The notary then lodges the deed with the Land Registry electronically.

7. Pay the taxes and register the deed

Within 30 working days of completion you pay the purchase tax, ITP on a resale or AJD on a new build, and the deed is fully registered in your name. Your lawyer or a gestoría normally handles this. Afterwards, put the utilities and the IBI into your name and take out home insurance.

Taxes and fees on the Costa del Sol

The purchase price is not the whole cost. Set aside 10 to 12 per cent on top for tax and transaction costs, and slightly more if you are buying with a mortgage. The tax depends entirely on whether the home is a resale or a new build.

Cost	Resale home	New build (first sale)
Purchase tax	ITP 7 per cent	IVA 10 per cent plus AJD 1.2 per cent
Notary fees	Set by official scale, roughly 0.1 to 0.5 per cent
Land Registry fees	Set by official scale, roughly 0.1 to 0.4 per cent
Legal fees	Around 1 per cent plus IVA
Rule of thumb, total added cost	About 10 per cent	About 12 to 13 per cent

The 7 per cent ITP rate for resales is a flat rate that has applied across Andalucía since 28 April 2021, confirmed by the Junta de Andalucía. Reduced rates exist: 6 per cent on a home whose taxable value does not exceed 150,000 euros, and 3.5 per cent for buyers under 35 purchasing their habitual residence within the same limit. New builds are outside ITP and instead carry IVA at 10 per cent plus AJD at 1.2 per cent. Our cost calculator works the total for a specific price.

The valor de referencia and your tax bill

Since 2022, ITP and AJD are charged on the higher of the price you pay or the Catastro valor de referencia, not automatically on the price. The valor de referencia is a value the Dirección General del Catastro assigns to almost every property, and you can look it up before you buy. If it is higher than the agreed price, the tax is calculated on that higher figure, so it is worth checking early rather than being surprised at completion. If you believe it is too high you can pay on it and then appeal.

Who pays what if you use a mortgage

Since the mortgage law of 2019 (Ley 5/2019, de Contratos de Crédito Inmobiliario), the lender carries most of the mortgage set-up costs. According to the Banco de España, the split is fixed by law.

Cost	Who pays
AJD tax on the mortgage	The bank
Notary fee for the mortgage deed	The bank
Land Registry fee for the mortgage	The bank
Gestoría (administrative processing)	The bank
Property valuation (tasación)	The buyer
Your own copy of the deed	The buyer

Non-residents can usually borrow up to about 60 to 70 per cent of the valuation, against roughly 80 per cent for residents, so plan the deposit accordingly. The valuation, or tasación, is the main mortgage cost that falls to you.

Common mistakes to avoid

The recurring problems on this coast are avoidable. Signing a reservation or private contract before a lawyer has read it is the first, because those documents already bind you. Assuming the notary protects your interests is the second, because the notary is neutral. Budgeting only for the price and forgetting the 10 to 12 per cent of costs is the third. On resales, not checking for community fee arrears or an undeclared extension can transfer someone else's problem to you. On off-plan, paying a developer without a bank guarantee for your staged payments leaves your money unprotected if the project stalls. Every one of these is caught by ordinary due diligence.

New build or resale

Both routes are common on the Costa del Sol, and the right one depends on your timeline and appetite for the process.

	New build	Resale
Purchase tax	10 per cent IVA plus 1.2 per cent AJD	7 per cent ITP
Condition	Brand new, modern spec, warranty	Established, often more mature location
Timing	Off-plan can mean a wait and staged payments	Move in on completion
Negotiation	Price usually fixed by developer	More room to negotiate
Best for	Buyers wanting new and turnkey, and off-plan investors	Buyers wanting to see the exact home and move quickly

If you are weighing an off-plan purchase, our note on what to consider when buying off-plan covers the guarantees to ask for, and you can browse current new developments or the wider Costa del Sol area guide to narrow down a location.

Questions people ask

How much are the total costs of buying a property in Spain?

Budget 10 to 12 per cent of the purchase price on top of the price itself. On a resale in Andalucía the largest single item is the 7 per cent ITP transfer tax, plus notary, Land Registry and legal fees. On a new build it is 10 per cent IVA plus 1.2 per cent AJD, which pushes the total closer to 12 to 13 per cent. Buying with a mortgage adds the valuation cost.

Do I need an NIE to buy property in Spain?

Yes. The NIE (Número de Identidad de Extranjero) is your Spanish tax number and is required to sign the deed, pay the taxes and open utility accounts. You apply with form EX-15 and pay the tasa modelo 790, código 012, of 9.84 euros, either at a Spanish consulate abroad or at a national police station in Spain. Allow a few weeks.

What is the property transfer tax in Andalucía?

For a resale home the ITP is a flat 7 per cent across Andalucía, applied since 28 April 2021. A reduced 6 per cent applies where the taxable value does not exceed 150,000 euros, and 3.5 per cent for buyers under 35 buying their habitual residence within that limit. New builds pay 10 per cent IVA plus 1.2 per cent AJD instead of ITP.

Is the tax based on the price I pay or the Catastro value?

Since 2022 the tax is charged on the higher of the agreed price or the Catastro valor de referencia. You can look up the valor de referencia for a specific property on the Catastro website before you commit, which avoids a surprise at completion if it is above the price.

Do I really need a lawyer, or is the notary enough?

You need an independent lawyer. The notary is neutral and confirms the deed is correctly signed, but does not investigate debts, planning breaches, licences or community arrears, and does not advise you. An independent lawyer, acting only for you, runs the due diligence and reviews every contract before you sign. On the Costa del Sol this is standard practice for non-resident buyers.

Who pays the mortgage costs in Spain?

Under Ley 5/2019 the bank pays the AJD tax on the mortgage, the notary fee for the mortgage deed, the Land Registry fee and the gestoría. The borrower pays for the property valuation, or tasación, and any copy of the deed they request. Non-residents can typically borrow around 60 to 70 per cent of the valuation.