Things to Consider When You Buy a Second Home in Spain

When you decide to buy a second home in Spain, you should think carefully about what your budget will allow. You should never spend more than thirty to thirty-five percent of your income on a new property. Moreover, you should also be aware of taxes and planning permissions. Also, you should consider insurance.


If you are planning to buy a second home in Spain, it is important to know the taxes that will apply to your purchase. In Spain, the property acquisition value includes the price paid for the property, the costs incurred during the purchase process, and any improvements or investments made in the property. In addition, you will be liable to pay capital gains tax, which is typically between 19% and 24% of the purchase price.

One of the first taxes that you need to know about when buying a second home in Spain is the Documented Legal Acts (AJD) tax. This tax must be paid by the owner of a new property, and its amount will depend on the region or Autonomous Community. In addition, there are taxes that apply to gifts, real estate, and bank accounts. The good news is that these taxes are relatively small.

Another factor that will impact the price of a second home in Spain is the tax laws in different regions. This taxation will be different from region to region, so it is important to research these laws before you make a decision. Additionally, it is a good idea to visit the location you are considering to make sure it has all the amenities you need. If possible, you should visit the potential location during off-peak hours so that you can see whether it is suitable for your needs.

In addition to property taxes, you may also have to pay inheritance and gift taxes. You must consult a tax advisor before buying a second home in Spain.

Planning permission

Planning permission is essential if you want to build or extend a property. Planning permission in Spain is easy to obtain. There are a few steps that must be followed. The first step is to contact the town hall of your chosen location. Then, you must discuss your plans with the building association. If approved, you will then need to submit professional architect drawings.

The cost of obtaining planning permission for a building is different from region to region. The fee is minimal for a licencia de obra menor, but may be high for a large project. It is also necessary to budget for the costs involved, including fees for an architect and a professional college. The planning permission fee will range from two to six percent of the overall cost of the project.

Another important step is getting a survey. The surveyor can verify that the building is sound. Once this has been verified, the buyer pays a reservation fee. This will hold the property for a certain period of time. The builder will also state that they will not sell the property to anyone else. If you are buying a property with a developer, you should also make sure the developer is registered and has legal paperwork. In addition, make sure the developer has separate insurance to protect against structural damage. The property manual should have information on the developer’s insurance policies.

In Spain, 14.3% of households own a second home. It is important to get planning permission for a second home to avoid any difficulties in the future. If you have different priorities and want to make your holiday property a permanent residence, it’s important to have the space. Otherwise, you may end up selling it and purchasing another property.


There are several costs involved in buying a second home in Spain. First of all, the property must be a new build and must not have been previously sold or occupied. You will also have to pay for a building survey. The building survey can cost up to 15% of the purchase price.

Another cost is the mortgage. Buying a second home in Spain requires that you get a mortgage. Non-residents in Spain can usually qualify for mortgages up to 60-70% of the property’s value. However, in order to get a mortgage, you must have at least 40 percent of the home’s value in savings. Considering the average price of a Spanish home, it would take you around PS52,000 to save up this amount. In addition, you will also have to budget about 15% of the property’s value for other expenses.

In addition to the mortgage, you will have to pay bank charges when buying a property in Spain. These costs vary from region to region, but generally average between eleven and fourteen percent of the property’s cost. There are also costs associated with obtaining a Spanish NIE number and connecting utilities. These fees can run anywhere from EUR300 to EUR2,000.

Finally, you’ll have to pay for community fees. The cost of community fees varies widely, depending on the amenities and maintenance of the complex. Great amenities and beautiful landscapes are usually not cheap. As such, community fees can add up over time. In addition to community fees, each owner is also responsible for sharing the costs of complex maintenance.

Another expense you should be aware of is the fee for notary services. These fees vary considerably depending on the location and type of property. Generally, a Spanish notary will charge between two and five percent of the declared purchase price. Other costs include stamp duty and VAT, which are charged at a standard rate of around one percent of the property’s value.


It is essential to ensure that you have adequate insurance when buying a second home in Spain. The first step to taking out an insurance policy is to obtain pre-approval from a bank before making the purchase. Many Spanish banks offer up to 80% of the valuation or purchase price as a loan with repayment terms up to 30 years. When you buy a second home in Spain, you will also need to have insurance to protect yourself from damage and theft. This insurance is compulsory in Spain and is usually provided by the bank.

Home insurance covers you in case of unexpected events that happen in your new home, and is a good idea whether you are going to live there for a long or short period of time. Although it is not compulsory in Spain, it is advisable to have it. It can help protect you in the case of natural disasters, burglary, and water damage. Some mortgaged properties require homeowners to have home insurance, so it is important to obtain the right type of insurance policy.

Although it is common to find low mortgage interest rates in Spain, it is important to bear in mind that the interest rates can go up and that it may be difficult to make mortgage payments. If property prices are rising, this can increase your profit margins. However, remember that buying a second home in Spain carries a significant financial burden. Taking out a mortgage is one way to mitigate this, but it will come with extra costs.

You can avoid paying too much for a house in Spain by doing some research beforehand. You can also visit the area and chat with locals about the property you want to buy. You should look for a property that is both liveable and good for investment purposes. In addition, you should check the standards of construction. Some older houses may be vulnerable to hidden problems, so make sure to check before purchasing.

Currency risk

Foreign buyers who are considering a second property in Spain face a number of issues including currency risk. The exchange rate can fluctuate dramatically and can affect the price of the property and any other payments. As a result, it is important to plan ahead and keep an eye on the currency market. In addition, you should consider the impact of political and economic events on currency prices.

The currency risk is often underestimated, but it is still present. Banks can overcharge you by adding a fee to their mid-market exchange rate and overcharging for international transfers. A better way is to move money abroad with a service like Wise. You should also consider the bank you are using to finance the purchase. Although Spanish banks are relatively well-developed for foreigners, their mortgage products will vary greatly.

Purchasing a property in Spain with a mortgage means you don’t have to put up your own money, and can also give you extra leverage when it comes to selling it later. During periods when interest rates are low, you can even sell the property at a profit. However, you should be aware that buying a second home in Spain involves a number of costs and mortgage.

Currency risk is another issue foreign investors face when purchasing property in Spain. However, with the recent economic recovery, the country has been able to bounce back from the financial crash. In fact, Spain is one of the most popular tourist destinations in Europe, and this is boosting the country’s economy. Moreover, sustainability is becoming a major focus in the country. Furthermore, Spain is a member of the European Union (EU) and the EU has been supportive of Spain’s post-COVID recovery plan.