One good thing about moving to the Canary Islands is that they are so popular with British migrants, expats and property buyers that you are not short of relocation and removal services. In fact, container shipping and removal services to the major islands such as Tenerife, Fuerteventura, Gran Canaria and Lanzarote are very frequent and quite cost effective.
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The Spanish property market has many quirks, and it pays to do your research before buying. Factors to be aware of when buying Spanish property include property scams, high capital gains tax, and fluctuations in the property market.
The process of buying a property in Spain usually runs as follows. First, the buyer makes an offer. If this is accepted, then the buyer and seller sign a preliminary contract (contrato privado de compravento) and the buyer pays a deposit, typically 10% of the purchase price.
The worst property scams in Spain, as elsewhere, involve unfinished or unbuilt properties. While malicious intent is rare, caution is advisable when buying a property that does not yet exist. At a minimum, you should:
One of the biggest advantages of looking to relocate to a tourist-centred area is that renting property is usually quite easy. Holiday lets are big business, and this means you can often find a good deal during the winter months. You could easily rent a property on one of the larger islands for a few months and use this as your base to explore the other islands.
In our blog, Costs of buying property in the Canary Islands, we give you the most complete overview of the costs involved in buying a house or flat in the region. We also discuss the costs of owning and selling real estate. Of course, the actual costs may be subject to changing regulations or local exceptions. When buying or selling a property in Canary Islands, always seek the advice of a lawyer or legal advisor, and be sure to ask them for an overview of all possible costs for your specific situation.
The Spanish property market has many quirks, and it pays to do your research before buying a home in Spain. Knowing what to expect when buying property in Spain can help avoid any pitfalls of setting up your life abroad. Factors to be aware of when buying Spanish property include property scams, high capital gains tax, and fluctuations in the Spanish real estate market.
The only thing you need when buying a property in Spain as a foreigner (in legal terms) is the NIE (Número de IdentificaciÃn del extranjero). This number, which is unique to each individual, is essential to carry out any transaction in Spain. Since it must appear on all documents that you sign or are issued in Spain, you must have it before signing the deed. The NIE is not complicated to obtain, but it does take a long time; ask your real estate agent to make it easier for you to obtain the NIE in order to speed up the process as much as possible.
Yes! If you are British and you are thinking of buying a house in Spain to retire you are still allowed to do so. However, you will be subject to the Non-EU regulations, which make the path of buying property in European Countries a little bit more complicated. Applying for a Spanish Non Lucrative Visa might speed the process of purchasing the house.
When buying a resale property (a property that has changed hands at least once) you will be required to pay the Transfer Tax or ITP in Spanish, that is levied on a sliding scale depending on the purchase price.
Hello and thank you for such great information and guides to buying properties in Spain.
I would like to know in order for a foreigner to apply for NIE, for the purpose of buying a property in Spain, does the applicant have to present a signed purchase contract from the seller or the real estate agent as the reason for applying for NIE?
Thank you in advance,
Ali Jannati
can americans buy property in spain? What do I have to do? I am in love with Ibiza and I would like to buy a property there to spend 4-5 months there, can you help me with the whole process? I would like your advice on the whole process of buying my summer house.
Hello! I am a citizen from Georgia and would like to buy an average flat in Spain. I wonder what are the steps I will have to follow and if there is some restriction on buying apartment for non-EU residents. Also, what are the documents I will need for buying the property.
One of the main factors that makes Tenerife like tax havens is that it is in the ZEC, the Special Canary Islands Zone. This is a low taxation zone within the framework of the Canary Island Economic and Tax Regime (REF), with a corporate tax of 4%, compared to the national 25% and the average European Union rate of 21.3%. It also enjoys a IGIC (VAT) of just 6.5%; a great incentive for the implementation and consolidation of economic activities in sectors including technological development, ICT (Information and Communication Technologies), services to companies and outsourcing, audio-visual activities, tourism, the maritime sector, and transport and logistics, to name a few.
One of the most important requirements for accessing the advantages of ZEC, in addition to being a new company (i.e. newly established), is the obligation of having a legal residence in the Canary Islands of at least one of the entity's representatives or administrators. With this is mind, buying a luxury property in Tenerife gives you the benefit of obtaining residence in Europe and, as such, enjoying these incredible advantages in developing your new business.
With regards to the number of permits granted for the construction of new urban projects, the Canary Islands are lagging behind many other Spanish destinations. In fact, while the national average will touch 26%, the archipelago will remain at 5%. However, this data doesn't have to be such a bad thing.
It is the resale homes that are currently the main players of the national real estate market. This is exactly what has happened in the Canary Islands. In addition, it must be noted that, for obvious reasons, the possibility of building new properties on any of the islands that make up the archipelago is a complicated task. This is why property investment tends to be especially profitable on these islands.
Why do foreigners choose the Canary Islands?
When it comes to buying homes in the Canary Islands, the increase in property prices is one of the main reasons that attracts foreigners. In fact, some of these buyers choose to buy their second homes in the islands of Tenerife, Las Palmas, Lanzarote and Fuerteventura. By doing so, they will have a place to go to during their holidays and, if they want, they can sell the property for a much higher price than what they originally paid for it.
Keep in mind that the tourist attractions of Canary Islands have already proven to be imperishable. In fact, the archipelago has been present in the tourist industry for decades. The beauty of its landscapes, the quality of its beaches, the great atmosphere and, above all, the good weather, are the features that make it an absolutely idyllic destination to own a home in.
For all these reasons, it is not surprising that more and more real estate agencies and entrepreneurs are embarking on taking advantage of the current market situation. The same goes for Engel & VÃlkers, which at the moment has licenses available in Las Palmas de Gran Canaria, Fuerteventura, Lanzarote and Tenerife. It is, without a doubt, a unique opportunity.
You'd be surprised at how many people actually do a "Shirley Valentine", tearing up those return tickets in pursuit of a new life. Now, while I personally wouldn't recommend such a hasty decision, there is a lot to be said for seriously contemplating buying a property in Tenerife.
For other people though, the primary reasons for buying a property here are more bank-balance inspired. Investment in sunshine bricks and mortar is hugely popular. Buying to let is also extremely popular, particularly with homes on or near the coast. However, tight letting laws have been introduced so seek professional advice about the legalities of renting out a holiday home in Tenerife.
If you are buying property in Lanzarote, then make sure to identify what your budget is and set a practical time frameregarding your purchase. Ideally you should be in a 'liquid' position as possible by either having cash at hand or having Spanish mortgage approval.
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