Buying property on Costa Blanca as a foreigner

The Número de Identificación de Extranjero (NIE) is the tax identification number every non-Spanish buyer needs to purchase property, open a bank account, pay taxes, or sign almost any official document in Spain. It is typically the first practical step in the process, and it can take a few weeks to arrange, so it is worth starting early rather than leaving it until you have found a property.

You can usually apply for an NIE at a Spanish consulate in your home country before travelling, or in Spain itself at a designated Oficina de Extranjeros or some police stations, often by appointment only. Many buyers instead give a lawyer or gestor power of attorney to apply on their behalf, which can save a trip and is common practice when buyers are not planning to be in Spain for the whole process.

While it is not always strictly mandatory to have a Spanish bank account to buy property, in practice it makes the process considerably smoother, since utility direct debits, community fees, IBI (local property tax) and mortgage payments are typically set up through a Spanish account.

Requirements vary by bank, but you will typically need your passport, NIE, proof of address and proof of income or employment. Non-resident accounts are common among foreign buyers who do not live in Spain year-round, and terms differ from resident accounts, so it is worth comparing a couple of banks before choosing one.

It is standard practice, and strongly advisable, to instruct an independent lawyer (abogado) who represents only your interests — not the seller's, and not the agent's. Estate agents in Spain typically act for the seller, so relying solely on the selling agent's paperwork checks is not a substitute for independent legal advice.

A good property lawyer will typically review the nota simple (a summary of the property's legal status from the Land Registry), check for outstanding debts or charges on the property, verify that the building matches what is registered (relevant for extensions or reforms), confirm planning and habitation status, and draft or review the private purchase contract before you sign anything or hand over a deposit.

Once you've chosen a property, the usual sequence is a reservation agreement (taking the property off the market with a small holding deposit), followed by a private purchase contract (contrato de arras or contrato de compraventa) once due diligence is complete, typically with a larger deposit — often around 10% of the price, though this is negotiable.

Arras contracts commonly include a penalty clause: if the buyer withdraws, they typically forfeit the deposit; if the seller withdraws, they typically have to return double the deposit. Because these clauses have real financial consequences, it is worth having your lawyer review the exact wording rather than assuming a standard template applies.

The purchase is formally completed when both parties sign the escritura pública (public deed) in front of a Spanish notary. The notary verifies identities and confirms the deed reflects what was agreed, but does not represent either party's interests, which is another reason independent legal advice matters throughout the process, not just at signing.

On completion day, the remaining balance is paid (commonly via bankers' draft), keys are handed over, and the notary submits the deed for registration at the Land Registry, formally recording you as the new owner. Registration can take some weeks to finalise even though possession transfers on signing.

For resale (second-hand) properties, the main tax is Impuesto de Transmisiones Patrimoniales (ITP), a transfer tax. In the Valencian Community, where Costa Blanca sits, this has typically been around 10% of the declared purchase price in recent years, though rates and any reduced bands for specific buyer categories should always be verified locally, as regional tax rules are updated periodically.

For new-build properties bought directly from a developer, the tax treatment is different: buyers typically pay VAT (IVA), commonly 10% for residential property, plus Actos Jurídicos Documentados (AJD, stamp duty), often in the low single digits as a percentage, rather than ITP.

On top of the relevant transfer tax, budget for notary fees, Land Registry fees, and your lawyer's fees, plus a mortgage arrangement and valuation fee if you are financing the purchase. As a rough rule of thumb some buyers use, all-in additional costs on top of the purchase price often land somewhere in the region of 10-14%, but this varies by property value, financing and province, so ask your lawyer for a written estimate specific to your purchase.

For a straightforward resale purchase paid in cash, the period from an accepted offer to completion is often somewhere between four and eight weeks, largely dictated by how quickly due diligence, funds transfers and notary scheduling can be arranged. Mortgage-financed purchases typically take longer, since bank valuation and approval add extra steps.

New-build purchases follow a different rhythm entirely, often spanning many months or longer between reservation and key handover, tied to the developer's construction schedule, with staged payments along the way that should be protected by a bank guarantee (see our guide on red flags in listings for more on this).