Property Buying Process in the Canary Islands for Foreigners

Buying a property in the Canary Islands as a foreigner is a structured and secure process, but it requires understanding certain administrative steps specific to the Spanish system. This guide details each phase to ensure your purchase is transparent and hassle-free.

Step 1: Obtain the NIE (Foreigner Identification Number).

This tax number is mandatory for any real estate transaction in Spain. It can be obtained at the Spanish consulate in your home country or directly in Spain at the immigration offices. The process typically takes 2–4 weeks. Nexta Living can assist with this procedure through specialised legal agents.

Step 2: Open a Spanish bank account.

This is essential for managing the property payment, taxes and recurring expenses. Major Spanish banks offer specialised services for non-residents. You will need your passport, NIE and proof of address. Some banks allow you to start the process online.

Step 3: Property reservation.

Once your ideal property has been identified, a reservation contract is signed along with the payment of a deposit (typically €3,000–€10,000 depending on the property value). This document removes the property from the market while due diligence is completed.

Step 4: Legal due diligence.

We will confirm ownership of the property, absence of debts or mortgages, compliance with urban planning regulations, energy efficiency certificate, habitation certificate, and first occupancy licence (if it is a new build). We will also verify that there are no outstanding community fees or property taxes (IBI).

Step 5: Deposit contract (Contrato de Arras).

A private purchase contract is signed with a deposit payment of 10% of the purchase price. This contract legally binds both parties and sets the date for completion at the notary. It specifies penalties in case of breach: the seller must return double the deposit, while the buyer would lose it.

Step 6: Notary signing and public deed.

The public deed of sale is signed before a notary, the remaining purchase price is paid (usually by confirmed bank transfer or bank cheque), and the keys are handed over. At this stage, the Property Transfer Tax is paid (6.5% in the Canary Islands) or VAT if it is a new build (7% IGIC in the Canary Islands).

Step 7: Property registration.

The deed must be registered in the Land Registry for the transfer to be legally enforceable against third parties. This process is usually handled by the notary or your lawyer and takes approximately 2–3 months.