Buying a Home in Spain

Spain is a familiar destination for Israelis looking for a holiday home, a second base in Europe or a place to live part of the year. As with any purchase abroad, the transaction is governed by local law, not Israeli law, so rules we know from transactions in Israel do not necessarily apply. This article explains, from the Israeli side, what is worth checking before you commit and which stages are worth knowing in advance.

It is important to stress that Spanish law governs the transaction itself, so it is reviewed by a local lawyer licensed to practice in Spain. An Israeli lawyer assists with the Israeli side, coordinates with the local lawyer and prepares your documents, but is not a substitute for local legal advice.

First: a lawyer who acts for you

Brokers, developers and sellers often suggest "a lawyer we work with". That is not wrong in itself, but whoever represents you should act for you alone. It is worth asking in advance:

• Who pays the lawyer, what it costs, and what the service includes: checks, contract review, support at signing and registration.
• Which languages the lawyer works in and how progress will be reported to you.
• Which additional costs to expect. Ask for a written, current breakdown before committing.

Checking the property before any payment

Before paying a deposit, the local lawyer checks the property's legal status. Common checks include:

1. Ownership and registration. Whether the seller is the registered owner and the details match the land registry. In Spain it is usual to obtain an extract from the Spanish land registry (called a "nota simple"), and the local lawyer will explain what it contains and what legal implications it has.
2. Encumbrances and third-party rights. Mortgages, attachments or rights of others recorded on the property.
3. Planning and construction compliance. Whether the actual construction matches the permits and there is no issue with the permitted use.
4. Debts. Local taxes, building charges and utility bills. Ask for proof of payment.
5. Shared buildings. Owners' meeting decisions on renovations or shared expenses that may fall on the buyer.
6. Short-term rentals. If you plan to rent to tourists, ask the local lawyer in advance whether it is allowed for the property and the area, and whether a licence is required. Rules differ between regions and may change over time.

Existing property or off-plan

Buying in a project that is still under construction resembles buying from a developer in Israel, and similar questions apply:

• Who owns the land, and whether it is mortgaged to the financing bank.
• What happens to the money you paid if the project is delayed or stopped, and what guarantees secure it.
• When delivery is expected, whether the contract provides compensation for delay, and what the binding specification is.
• Which permits have been issued and who is responsible for completing registration in your name.

The usual stages

The exact structure varies, but the process generally looks like this:

• Preliminary checks by a local lawyer, before any financial commitment.
• An NIE number. This is an identification number for foreigners, generally required for tax purposes and to complete a transaction in Spain. The local lawyer will explain how to apply and who can act for you in the process.
• A preliminary contract. In Spain it is common to sign a preliminary contract with a deposit (often called "arras"). It is important to understand in advance what happens if a party withdraws, and what the conditions precedent are, such as mortgage approval.
• Signing the deed before a local notary, and registering the rights in the land registry. The local lawyer will set out the timing and requirements.
• Taxes and charges. Rates and costs vary by property type, region and circumstances. Do not rely on general tables online or on what the seller tells you. Get a written, current breakdown from the local lawyer or the competent authority.

Notarial power of attorney and apostille

If you cannot travel to Spain to sign, you can appoint a representative to sign for you. The usual route is a notarial power of attorney, and in Israel the process generally looks like this:

1. The local lawyer approves the wording and the required powers.
2. You sign in Israel before a notary, who verifies your identity and signature.
3. The document receives an apostille, a certificate that allows an Israeli public document to be used in a country party to the Hague Convention. Israel and Spain are both parties.
4. Sometimes a certified translation into Spanish by a sworn translator is required.

Define precisely in the power of attorney what the representative may do, for which property and to what extent, and set an expiry. An overly general power of attorney is an unnecessary risk. More about this field is on our international law page. A similar process is described in Buying Property in Portugal.

The Israeli side: reporting and tax

Buying property abroad is not only a local matter. As Israeli residents you may have duties in Israel, such as reporting assets and income from abroad, depending on Israeli law and your circumstances. Rental income or a future sale gain may be taxable in both countries, with mechanisms to prevent double taxation. Do not assume it all "sorts itself out". Consult an accountant or tax adviser who knows both systems before the purchase, not after.

Financing and moving the money

In large transactions, banks in Israel and abroad ask for an explanation of the source of funds. Keep documentation of the source of the capital and of every transfer. If you are considering a local mortgage, ask in advance whether the bank lends to non-residents and on what terms.

Residency and immigration

Buying a property does not automatically give status in Spain. Entry, residence and immigration rules are set by the Spanish authorities and change over time. Such questions are examined in advance with a local immigration lawyer, and only against the current official rules.

Inheritance and planning ahead

Property in Spain is also an asset included in the estate for inheritance purposes, and procedures may be needed in both countries. It is worth planning for this at the time of purchase. The Israeli background appears in How to Write a Will in Israel, and for property abroad it is advisable to consult a local lawyer as well.

Common mistakes

• Paying a deposit before checking the property.
• Relying on a lawyer or broker acting for the seller.
• Signing a preliminary contract without understanding what happens if the deal does not complete.
• Signing an overly broad power of attorney.
• Ignoring the Israeli side: reporting, tax and inheritance planning.

In summary

Buying a home in Spain goes smoothly when it is accompanied by the right checks, a local lawyer acting for the buyer and well-prepared documents in Israel. If you are considering such a purchase, you can contact us for support on the Israeli side of the transaction, including a notarial power of attorney, apostille and coordination with a local lawyer.

The information in this article is general, is not legal advice, and does not replace a review of Spanish law with a lawyer in Spain.