Buying Property in Spain in 2025: What You Need to Know

If you’re considering buying property in Spain in 2025, recent developments suggest that there may be significant changes that could affect non-EU buyers. The Spanish government has proposed a new tax of up to 100% on real estate purchases by non-EU residents in an effort to address the country’s housing crisis. Although these changes are still in the proposal stage, it’s important to stay informed as they could impact your plans. Some analysts are claiming such measures will not be allowed but nothing is clear yet.

What does a tax of up to 100% on real estate purchases actually mean?

Only time will tell what changes will happen in 2025. The end of the Spanish Golden Visa is already scheduled for April 2025.

Let’s have a look at these recently proposed measures and also at the real cost of buying property in Spain in 2025 …

Proposed Tax on Non-EU Buyers Buying Property in Spain in 2025

The Spanish government, led by Prime Minister Pedro Sánchez, has announced plans to impose a tax of up to 100% on property purchases by non-EU residents. This measure targets foreign investors, especially those from the UK, the US, and other non-EU countries. The government, with these measures, intends to tackle Spain’s escalating housing affordability issues.

• Foreign Spending in the Spanish Property Market: Foreign buyers are increasingly contributing to rising property prices. In the second half of 2023, non-residents paid an average of €2,715 per square meter for homes in Spain. That is an increase of 6.1% compared to the previous year. This is the highest average recorded for non-residents.
• Comparative Pricing: The average price paid by all foreign buyers (residents and non-residents combined) stood at €2,175 per square meter, returning to 2008 levels, with a 4.1% year-on-year increase. By contrast, the overall average price in Spain, including both foreign and domestic buyers, reached €1,712 per square meter, up 2.1% from the previous year.

Foreign buyers from countries like Sweden, the US, Germany, and Switzerland paid the highest prices per square meter:

• Top Paying Nationalities:
  • Sweden: €3,077/m²
  • USA: €3,006/m²
  • Germany: €2,848/m²
  • Switzerland: €2,828/m²
• Lowest Paying Nationalities:
  • Morocco: €723/m²
  • Romania: €1,096/m²
  • Bulgaria: €1,219/m²

This growing demand from foreign buyers is contributing to rising property prices. This is one of the reasons behind the Spanish government’s push for regulatory changes.

Source: Idealista

Other Proposed Measures to Tackle Housing Affordability

Along with the potential tax on non-EU buyers, the Spanish government is introducing additional measures to address the housing crisis and improve the affordability of homes for locals:

• Increase in Social Housing: Currently, only 2.5% of housing in Spain is designated as social housing, a figure far below that of other European countries. The government aims to increase the availability of social housing to provide more affordable living options.
• Incentives for Property Renovations: To make better use of existing properties. The government plans to offer incentives for property owners who renovate and rent out vacant homes at affordable prices.
• Crackdown on Short-Term Rentals: Spain intends to tighten regulations and increase taxes on short-term rental properties. Targeting those listed on platforms like Airbnb. This move aims to increase the supply of long-term rentals for local residents who are being priced out of the market.

Why You Should Act Now About Buying Property in Spain in 2025

These new measures, particularly the proposed tax on non-EU buyers, could significantly impact the real estate market in Spain. Here’s why it might be a good idea to act sooner rather than later:

• Rising Property Prices: As mentioned, the average price paid by non-residents is at an all-time high. The proposed tax may increase the cost of purchasing property for non-EU buyers. Purchasing now could help you avoid the impact of these future taxes.
• Market Uncertainty: Although these changes have not yet been finalised, the uncertainty surrounding the potential new tax may create market fluctuations. Securing a property now could help you navigate these uncertainties before any new regulations are implemented.
• Investment Opportunities: Spain remains an attractive destination for foreign buyers. Particularly with strong demand in popular regions like the Costa Brava, Costa del Sol, and Balearic Islands. Taking action now allows you to invest in these sought-after areas before any regulatory changes take effect.

The Real Cost of Buying Property in Spain in 2025

Buying a property in Spain can be exciting but also comes with additional costs beyond the property price. If you’re looking at Malaga or Cadiz, here’s a breakdown of the key expenses you should expect in 2025.

Main Costs of Buying Property in Spain in 2025

1. Deposit & Mortgage Requirements

• Spanish banks usually finance up to 80% of the property value if it’s your main residence.
• For non-residents, mortgages are typically limited to 60% of the property price.
• You need at least 20-40% of the property price as a deposit, depending on residency status.
• Additional costs (taxes & fees) range between 10% and 12% of the purchase price.

2. Notary Fees

• Required for formalizing the purchase and ensuring all legal aspects are properly documented.
• The notary drafts the official deed of sale and verifies the identity of the parties involved.
• Cost: Between €600 and €1,000, depending on the property price.

3. Land Registry Fees

• Covers the cost of officially registering the property in Spain’s Land Registry.
• Ensures legal ownership and protects against potential disputes.
• Cost: Between €400 and €700.

4. Legal Fees

• Hiring a lawyer is highly recommended to handle contracts, tax compliance, and due diligence.
• A qualified lawyer usually charges 1% of the property value.

5. Real Estate Agent Fees

• Real estate agent fees are typically included in the advertised selling price in most parts of Spain.
• However, in many cases, in Cadiz for example, it is common for buyers to pay an additional 3% on top of the sales price, as fees are split between the vendor and purchaser.

Taxes on Buying Property in Malaga & Cadiz

New Build Homes

• VAT (IVA): 10% of the property price.
• Stamp Duty (AJD): 1.2% of the property price.

Pre-Owned Homes

• Property Transfer Tax (ITP): 7% of the property price.

Additional Mortgage Costs

1. Property Valuation

• Needed if you take out a mortgage to determine the property’s market value.
• Conducted by an accredited valuation company.
• Cost: Between €250 and €600.

2. Mortgage Opening Fee

• Some banks charge up to 2% of the loan amount for setting up the mortgage.
• Many banks now waive this fee, but check with your lender.

Example: Total Costs for Buying Property in Spain in 2025 for €500,000 

Expense	New Build (€)	Pre-Owned (€)
Notary Fees (0.2% – 0.5%)	€2,500	€2,500
Land Registry (0.1% – 0.25%)	€1,250	€1,250
Legal Fees (1%)	€5,000	€5,000
Real Estate Agent Fees (3%)	€15,000	€15,000
VAT (10%)	€50,000	€0
AJD (1.2%)	€6,000	€0
ITP (7%)	€0	€35,000
Total Estimated Cost	€79,750	€58,750

Final Thoughts

• Budget for 10-12% extra costs beyond the property price.
• Pre-owned homes in Malaga and Cadiz have lower purchase taxes than new builds.
• We recommend hiring a qualified lawyer instead of a gestor. A lawyer usually charges 1% of the property value.
• Non-residents should note that mortgage financing is usually limited to 60% of the property value.
• Be aware that in Cadiz, buyers are usually required to pay an additional 3% real estate agent fee on top of the sales price. This does not mean it is any more expensive, it simply means the agency fees are not included in the advertised price.

Planning ahead and knowing all the costs and potential regulation changes will help ensure a smooth property purchase in Spain!

If you’re considering buying property in Spain in 2025, stay ahead of any potential changes that could impact foreign buyers. With the possibility of new taxes and regulations, acting now is the best way to secure a property.

Take steps to make the process easier and ensure you’re making informed decisions. Contact Move to Malaga for expert assistance in purchasing property in Malaga and the Costa del Sol. Reach out to Cadiz Property Finder for guidance on buying property in Cadiz and the beautiful Costa de la Luz.

Our teams specialise in helping foreign buyers navigate the Spanish property market. We offer local knowledge, legal advice, and tailored support to find your ideal Spanish property. 

Don’t wait – contact us today to get started on your property journey in Spain!