Buying a home in Spain is not just a financial decision — it’s the moment when your lifestyle ambitions, your family’s future, and your long-held dreams finally align.
For Americans, Spain feels like the antidote to stress and overwork — a place where healthcare is excellent, daily life is affordable, and quality of life is something you feel every day, not just on holidays.
For Brits, Spain remains the emotional escape it has always been — but post-Brexit, buying property requires more planning and more awareness of tax and residency obligations.
And although Spain’s buying process is fair and highly regulated, it is very different from the U.S. and UK systems — especially when it comes to contracts, taxes, mortgages, and due diligence.
This guide is your official, law-based, number-backed, government-source-linked explanation of everything American and British buyers must know in 2025.
The 7-Step Legal Process: A detailed roadmap from obtaining your NIE number to signing the Title Deed (Escritura) at the Notary.
Total Cost Breakdown: Exact calculations for ITP tax (resale) vs VAT/IVA (new builds), plus legal and notary fees.
Mortgages for Non-Residents: LTV limits (60–70%) and specific documentation required for US vs UK applicants.
Critical Contract Clauses: Understanding the “Arras Penitenciales” and how it protects your deposit.
Ongoing Tax Obligations: A clear explanation of Non-Resident Income Tax (IRNR), IBI, and Wealth Tax.
US vs UK Differences: A comparison of FATCA requirements, tax treaty protections, and rental expense deductions.
Spain remains one of the most attractive real estate destinations in Europe due to:
Stable long-term value.
Strong international buyer demand.
High-quality new-build developments.
Strong rental demand (especially in coastal areas).
A lifestyle that outranks nearly all Western countries.
Lower cost of living vs. US/UK (INE & Numbeo data).
Spain received over 93,000 foreign homebuyers in 2024 (Spanish Notaries Council), with the Costa del Sol remaining the #1 region for non-resident buyers.
Spain’s purchase process is reliable, transparent, and legally secure — but different from US or UK systems. Here is the official, legally correct process.
NIE = Número de Identificación de Extranjero. You cannot purchase without it.
Apply at:
Outside Spain: Spanish Consulates (consulatefinder.exteriores.gob.es)
Inside Spain: National Police (sede.administracionespublicas.gob.es)
Processing time: 1–21 days.
Required for paying taxes, utilities, and transferring purchase funds.
US citizens must comply with FATCA, meaning banks may request an IRS W-9 form and additional identity verification (Source: Banco de España https://www.bde.es).
UK citizens have standard requirements (passport + NIE).
Lawyers will:
Run Nota Simple checks (Land Registry).
Check for debts, liens, and charges.
Confirm licences and planning permissions.
Ensure no embargoes exist.
Manage tax calculation.
Prepare for Notary completion.
Register the property in your name.
Important: Unlike the U.S. and UK, Spain has no title insurance. Legal due diligence is the protection.
This is a standard “Reserva” payment that removes the property from the market. You receive a Reservation Contract confirming price, timeframe, conditions, and deposit amount.
✔ Exact Legal Definition This contract is legally defined under Article 1454 of the Spanish Civil Code. (Official source (BOE): https://www.boe.es). It is the most important binding agreement in Spanish real estate.
✔ What It Means
Buyer pays 10% deposit (minus reservation).
Both parties are fully committed.
✔ Penalty Clause (Legally Enforceable)
Buyer withdraws: Loses deposit.
Seller withdraws: Must return double the deposit to the buyer.
This is unique to Spain — and crucial for US/UK buyers to understand.
The Notary (Notario) is a government-appointed legal authority who certifies the legality of the sale. You will:
Sign the Title Deed (Escritura Pública de Compraventa).
Pay the balance.
Receive the keys.
Become the legal owner.
The Notary sends your deed to the Land Registry (Registro de la Propiedad). Official registry: https://registradores.org
Your lawyer registers the property and pays all applicable taxes. Completion normally takes 2–6 weeks.
Taxes differ depending on whether the home is new or resale.
Tax: ITP (Impuesto de Transmisiones Patrimoniales)
Rate in Andalucía (2025): 7% flat
Example: €500,000 property → €35,000 tax
Official source: Junta de Andalucía https://www.juntadeandalucia.es
VAT (IVA): 10%
Stamp Duty (AJD): 1.2% in Andalucía
Total: 11.2% of purchase price.
Example: €500,000 new-build → €56,000 tax
Notary: €600–€1,200
Land Registry: €400–€1,000
Legal fees: 1% + VAT
Spain allows non-residents to obtain mortgages — but conditions differ.
Residents: up to 80%
Non-residents (US/UK): 60%–70%
Official banking regulations: https://www.bde.es
Standard docs include Passport, NIE, proof of income, last 6–12 months’ bank statements, tax returns, credit reports, and employment contract.
Americans must also supply: IRS Form W-9 and FATCA declaration forms.
Fixed: 3.25%–4.25%
Variable: Euribor + 0.99%–1.5%
Currency can change the real cost of your home by tens of thousands of euros.
Example: GBP/EUR changing from 1.16 → 1.12 changes a £500,000 budget by €20,000.
USD/EUR: Shifts throughout 2024 led to 8–12% swings, altering affordability dramatically.
These taxes apply whether you are resident or not.
Range: €300–€1,500 per year. Official municipality websites publish exact amounts.
Range: €80–€200/year.
Applies even if the property is not rented. ✔ Tax Rate:
UK Citizens: 19%
US Citizens: 24%
Official source: Agencia Tributaria — IRNR https://sede.agenciatributaria.gob.es
Spain taxes a theoretical income on your second home. Formula:
1.1% of cadastral value (if updated) OR 2% if not updated.
Tax = above number × your rate (19% or 24%).
UK owners: 19% tax (expenses are deductible).
US owners: 24% tax (expenses are not deductible).
When selling, tax applies on profit.
Capital Gains Tax Rates (2025)
19% on first €6,000
21% on €6,000–€50,000
23% on €50,000–€200,000
28% above €200,000
Source: IRPF Law (BOE) https://www.boe.es
3% Withholding Rule: Buyer must hold 3% of the sale price and pay it directly to the Spanish Tax Agency. Seller claims a refund if the tax owed is less.
Andalucía: Offers 100% relief for most family situations (exemptions apply for residents & close family).
You can read more about Spanish inheritance tax here, or specifically about IHT in Andalucía here.
| Feature | 🇺🇸 US Buyers | 🇬🇧 UK Buyers |
| Bank Compliance | FATCA compliance required | Standard Compliance |
| Tax Reporting | Global taxation continues (IRS) | Protected by Double Taxation Treaty |
| Rental Income Tax | 24% (No expense deductions) | 19% (Expenses are deductible) |
| Driving Licence | Must take Spanish test after 6 months | Exchange possible without test |
| Mortgage LTV | Typically 60-70% | Typically 60-70% |
PCC Property is uniquely positioned to guide international buyers because we:
Specialise exclusively in property sales.
Understand US FATCA, UK tax treaties, and cross-border complexities.
Work with Private Client Consultancy for tax, currency, and structuring.
Provide lifestyle-first area guidance.
Coordinate lawyers, tax advisors, and relocation partners.
Offer honest, expert, non-pushy guidance.
Focus on walking alongside buyers from search → keys → integration.
Explore your next step:
Relocation Guide: Moving & Settling in Málaga Province
Unlock. Live. Thrive. With PCC Property.
The information in this guide is for informational purposes only and was last updated in December 2025.
Immigration laws and financial requirements can change at any time.
We are real estate agents, not legal or financial advisors.
We strongly recommend consulting with a qualified Spanish immigration lawyer to discuss your specific circumstances before making any decisions.
We’ve Moved Offices on 1st August 2025!
Private Client Consultancy is excited to announce that we have moved to a brand-new office space, designed to better serve our clients and reflect our continued growth.
Effective Date: Friday, 1st August 2025
New Address: Urb Jazmin De Miraflores, C. Jazmín, 2, Mijas Costa 29649, Malaga, Spain
Our phone numbers and email addresses remain unchanged.
All in-person meetings scheduled from 1st August onwards will take place at our new location. Please update your records accordingly.
We look forward to welcoming you to our new space!
Check out our detailed area guides along the Costa del Sol and Algarve.
Keep up to date with property news along the Costa del Sol with our blogs.
At PCC Property we don’t just list properties, we unlock lifestyle dreams, Discover how our sales-only, lifestyle-first approach is different.
Who we are
Discover more on our commitment to transparency, trustworthy advice and delivering exceptional client service.