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For access to your online account please contact your personal account manager, alternatively email team@regencyfx.com.
Spain has long been one of the most popular destinations for British buyers looking to purchase property abroad. From the sun-drenched coastlines of the Costa del Sol to the terracotta rooftops of Seville, the country offers an extraordinary quality of life, a relatively affordable property market compared to the UK and a culture that has captivated foreigners for generations.
But buying a property in Spain is not quite the same as buying at home. There are important steps, costs and currency considerations to understand before you commit. Get them right and the process can be straightforward and rewarding. Overlook them and the financial consequences can be significant.
At Regency FX, we work with buyers at every stage of the property purchase process, helping them move their money to Spain efficiently and at the best possible exchange rate. In this guide, we walk you through everything you need to know, from finding the right location to completing the purchase and managing the currency exchange.
It is not hard to see why Spain continues to attract foreign buyers in such large numbers. The country enjoys around 300 days of sunshine per year in many of its most popular regions, the cost of living remains notably lower than in much of northern Europe and the food, culture and lifestyle are widely regarded as among the best in the world.
Spain also offers strong rental yields in tourist-heavy areas, making it an attractive proposition not just for those planning to relocate but also for investors looking to generate income from holiday lettings. Areas such as the Costa Blanca, the Balearic Islands, the Canary Islands and the outskirts of Barcelona and Madrid have all seen sustained demand from international buyers over recent years.
For British buyers specifically, Spain remains the number one destination for overseas property purchases. Even following Brexit, the dream of owning a villa, apartment or townhouse in Spain has not diminished, though the process has changed in some notable ways that we cover below.
Since the UK left the European Union, British nationals are no longer EU citizens and this affects how you can buy and live in Spain. However, it is important to note that Brexit does not prevent you from purchasing property in Spain. Non-EU nationals can buy property in Spain freely and there are no restrictions on foreign ownership.
What has changed is your right to live there. As a British citizen, you can now spend up to 90 days in Spain within any 180-day period without a visa. If you plan to live in Spain full-time or spend more than 90 days there at a stretch, you will need to apply for a visa or residency permit. The most popular routes include the Non-Lucrative Visa, which is suited to retirees or those with sufficient passive income, and the Golden Visa, which is available to those investing at least 500,000 euros in Spanish property.
It is worth seeking advice from an immigration lawyer as well as a property lawyer when planning your purchase, particularly if long-term residency is your goal.
Spain is a large and wonderfully diverse country and the right location for you will depend entirely on your priorities. Here is a broad overview of the most popular regions among foreign buyers.
The Costa del Sol stretches along the southern coast of Andalusia and includes towns such as Marbella, Nerja and Fuengirola. It is one of the most established expat communities in Europe and offers a broad range of property types at varying price points. Infrastructure is excellent with Malaga Airport providing easy access from the UK.
The Costa Blanca in the Valencia region encompasses towns like Alicante, Torrevieja and Javea. This stretch of coastline is particularly popular with retirees thanks to its warm climate, lower cost of living and relaxed pace of life.
The Balearic Islands, comprising Mallorca, Menorca, Ibiza and Formentera, offer some of the most desirable property in the Mediterranean. Prices here tend to be higher than on the mainland but the islands' natural beauty, strong rental market and prestige make them perennially popular.
The Canary Islands, particularly Tenerife, Gran Canaria and Lanzarote, benefit from a year-round warm climate and strong tourist demand. They are a sound choice for investors looking to maximise rental income.
Barcelona and Madrid attract buyers who prefer city living, whether for lifestyle reasons or as an investment in a rental property. Both cities have seen strong property price growth over the past decade and offer vibrant cultural scenes.
Buying property in Spain follows a structured legal process that differs in several ways from the UK system. Understanding the steps in advance will help you avoid delays and unexpected costs.
Step 1: Obtain an NIE Number
Before you can buy property in Spain, you will need a Numero de Identidad de Extranjero, known as an NIE. This is a tax identification number required for all financial transactions in Spain including property purchases. You can apply for an NIE at a Spanish consulate in the UK or at a police station in Spain. Many buyers appoint a Spanish lawyer to handle this process on their behalf using a power of attorney.
Step 2: Appoint an Independent Lawyer
You should always instruct an independent Spanish lawyer, known as an abogado, to act on your behalf. Your lawyer will carry out due diligence on the property, check for outstanding debts or charges, verify planning permissions and ensure the title deeds are in order. It is strongly advisable to use a lawyer who is entirely independent of the estate agent and developer to avoid any conflict of interest.
Step 3: Sign the Reservation Agreement
Once you have found a property you wish to buy, you will typically sign a reservation agreement and pay a small reservation fee, usually between 3,000 and 10,000 euros. This takes the property off the market while due diligence is carried out.
Step 4: Sign the Private Purchase Contract
If the due diligence comes back satisfactorily, you will sign a private purchase contract known as the Contrato de Arras. At this point, you will pay a deposit of around 10 percent of the purchase price. If you subsequently withdraw from the sale, you lose your deposit. If the seller withdraws, they are legally obliged to return double the deposit amount.
Step 5: Complete at the Notary
The final stage is completion, which takes place before a Spanish notary. At this point, you pay the remaining balance of the purchase price along with all associated taxes and fees. The title deed, known as the Escritura, is then signed and ownership transfers to you.
One of the most common mistakes buyers make when purchasing property in Spain is underestimating the total cost involved. Beyond the purchase price itself, you should budget for additional taxes, legal expenses and administrative fees, which can add between 10% and 15% to the overall cost of the transaction.
Transfer Tax applies to resale properties and varies depending on the region, typically ranging between 6% and 10% of the purchase price. In Andalusia, the current rate is 7%.
For new-build properties, VAT (IVA) replaces Transfer Tax and is charged at 10% for residential homes. In addition, buyers must pay Stamp Duty (AJD), which is usually around 1.5%.
Notary fees are regulated by the Spanish government and generally range between 0.2% and 0.5% of the purchase price. Land Registry fees are also regulated and are broadly similar in cost.
It is also worth noting that many Spanish notaries still require a banker’s draft for completion day, particularly for high-value property purchases. Buyers should therefore plan ahead for any banking or currency transfer arrangements needed before signing.
Legal fees for an independent Spanish lawyer are typically around 1% of the purchase price, although some firms charge a fixed fee instead.
If you are financing the purchase with a mortgage, arrangement fees, valuation costs and related banking charges may also apply.
In addition to the purchase itself, buyers should also budget for:
Understanding the full cost of ownership from the outset can help you avoid unexpected expenses and ensure your property purchase in Spain runs smoothly.
This is where Regency FX comes in and it is a part of the process many buyers do not give enough thought to until it is too late.
When buying a property in Spain, you will need to transfer a significant sum of money from pounds sterling into euros. For a property costing €300,000, the sterling cost can vary enormously depending on the exchange rate at the time of transfer. The difference between a favourable and an unfavourable rate can easily amount to thousands of pounds.
The GBP/EUR exchange rate fluctuates constantly, influenced by political developments, economic data, central bank decisions and wider market sentiment. In recent years, the pound has experienced significant volatility around elections, budget announcements and macroeconomic shifts. The rate you see today may look very different in three or six months' time when your purchase completes.
In some Spanish property transactions, particularly at completion before the notary, funds may need to be provided in the form of a banker's draft (cheque bancario). This is a guaranteed cheque issued by a bank and is still commonly used in parts of the Spanish property market for settling the final balance of a purchase.
Timing is critical. The draft must usually be prepared in euros for the exact completion amount and available on the day ownership transfers. Any delays, exchange rate issues or payment complications at this stage can jeopardise completion and create significant stress for both buyer and seller.
At Regency FX, we work closely with clients ahead of completion to ensure funds arrive in the correct account with sufficient time for the receiving bank to issue any required banker's draft before the notary appointment.
You can learn more about how we deal with a Banker's Draft here >
Regency FX is most valuable from around £50,000 upwards. This is where exchange rate movements start to materially affect the cost of your purchase and where working with a dedicated currency specialist delivers the greatest financial benefit.
For a purchase of £300,000, even a 1 percent improvement in the exchange rate saves £3,000. On a £500,000 purchase, the same improvement saves £5,000.
Our service for property buyers is built around four key areas:
All client funds are processed through FCA-authorised e-money partners including Sciopay, GC Partners and CurrencyCloud which is owned by Visa. Funds are held in ring-fenced safeguarding accounts completely separate from Regency FX's own business funds at every stage of the transfer.
We work much closer to the real mid-market rate than banks. There are no transfer fees, no hidden margins and your rate is explained clearly before you commit.
Spanish banks typically apply margins of between 2 and 4 percent on large international transfers. On a €300,000 purchase, a 3 percent bank margin could cost approximately £7,500 more than necessary.
Every client is assigned a dedicated account manager who oversees the transfer from start to finish. When completion deadlines are approaching and significant money is on the line, having a direct point of contact who understands your transaction is invaluable.
We offer several tools to help manage exchange rate risk throughout the property purchase process.
Spot contracts allow you to exchange currency immediately at the current market rate. These are commonly used for reservation fees or deposits where speed is important.
Forward contracts allow you to lock in an exchange rate today for a transfer taking place in the future, typically up to 12 months ahead. This is particularly useful once contracts have been signed and the completion amount is known, protecting you against adverse market movements before completion day.
Regular payment plans are ideal for ongoing euro expenses after completion, such as mortgage payments, utility bills or property management costs.
Working with a specialist currency provider rather than a high street bank can make a meaningful difference to the overall cost of your Spanish property purchase. Even a small improvement in the exchange rate can translate into savings of several thousand pounds.
It is entirely possible to obtain a mortgage in Spain as a foreign buyer, though the terms available to non-residents are generally less favourable than those offered to Spanish residents. Most Spanish banks will lend up to 70 percent of the property's value to non-resident buyers, meaning you will need a deposit of at least 30 percent plus enough to cover all taxes and fees.
Interest rates in Spain are shaped by the European Central Bank's monetary policy and it is worth speaking to a Spanish mortgage broker who can compare products across multiple lenders and help you find the most suitable deal for your circumstances.
Some buyers choose to remortgage a UK property to release equity for a Spanish purchase, which can offer greater flexibility and potentially more competitive rates. If you are considering this route, it is important to factor in the currency exchange element carefully as you will be taking on a euro-denominated asset while carrying sterling-denominated debt.
Once you have completed your purchase, there are a number of ongoing costs to keep in mind.
IBI (Impuesto sobre Bienes Inmuebles) is the Spanish equivalent of council tax and is payable annually to the local municipality. The amount varies depending on the location and rateable value of the property but is generally modest compared to UK council tax.
Community fees (gastos de comunidad) cover the maintenance and management of shared spaces if your property is part of a development. These can range from a few hundred to several thousand euros per year depending on the development.
Imputed income tax is charged on non-resident property owners based on the notional rental income of a property even if it is not actually rented out. The rate is typically around 1.1 to 2 percent of the property's cadastral value per year. If you do rent the property out, you will need to declare that rental income and pay tax accordingly.
Household insurance is strongly advisable and, if you have a mortgage, usually mandatory.
No. Non-residents can purchase property in Spain freely. You will need an NIE number to complete the transaction but residency is not a requirement for ownership. If you wish to spend more than 90 days in Spain within any 180-day period, you will need to apply for an appropriate visa or residency permit.
From agreeing a price to completing the purchase typically takes between two and three months. New-build purchases can take considerably longer, particularly if the property is still under construction.
This is a very real risk that catches many buyers off guard. If the pound weakens against the euro between the time you sign your purchase contract and the time you complete, the sterling cost of your purchase will be higher than you originally budgeted for. A forward contract with Regency FX allows you to lock in the exchange rate at the contract stage, protecting you from this risk entirely.
Yes, provided you take the right precautions. The most important step is to instruct an independent qualified Spanish lawyer to carry out full due diligence on the property before you commit. There have been well-documented cases of illegal builds and planning irregularities in some parts of Spain and a thorough legal check is essential.
Most buyers find it very practical to open a Spanish bank account and many estate agents and solicitors will recommend it. You will need a local account to pay ongoing costs such as IBI, utility bills and community fees. Opening an account with a Spanish bank is generally straightforward once you have your NIE number.
Banks typically apply exchange rate margins of between 2 and 4 percent on large international transfers. On a 300,000 euro purchase, a 3 percent margin costs approximately £7,500 more than necessary. Regency FX works significantly closer to the real mid-market rate with no transfer fees, meaning the saving on a typical Spanish property purchase is routinely measured in thousands of pounds.
A banker's draft is a guaranteed payment issued by a bank on behalf of a buyer. Unlike a personal cheque, the funds are secured by the bank before the draft is issued, which is why banker's drafts are commonly used for high-value transactions such as property purchases in Spain. In many Spanish property transactions, particularly at completion before the notary, the seller may request payment via a banker's draft rather than a standard bank transfer because it provides immediate proof that the funds are guaranteed and available.
Buying property in Spain is one of life's biggest financial decisions. The exchange rate you achieve, the timing of your transfers and the support you have around you during the process all have a direct impact on the total cost of your purchase.
We are the right choice when a transfer is large enough that a rate shift, a timing error or a missed deadline would genuinely matter. For property buyers, that is almost always the case.
Our dedicated account managers have guided countless buyers through the Spanish property purchase process, from the initial reservation fee through to completion day. They understand the pressure of legal deadlines, the importance of funds clearing on time and the value of having someone on your side who is focused entirely on getting you the best possible outcome.
Get in touch with Regency FX today to discuss your requirements and find out how we can support your Spanish property purchase.
Get your free quote today and see how much more of your money you could keep.
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