With incredible architecture, a big business network, and a warm climate, it is no wonder that foreigners decide to buy a property in Barcelona. If you are thinking of making a real estate investment in the Catalan Capital, this article will explain all the details for buying a home in Barcelona.
Why Buy a Property in Barcelona?
While Spain is one of the preferred countries to live in Southern Europe, many foreigners looking to settle in our country prefer to acquire a property on the coast. Barcelona’s attraction not only lies in its streets and atmosphere, but also in its local real estate market, which is one of the most stable.
The Real Estate Market in Barcelona
Before purchasing a home in the Catalan capital, it is necessary to understand the local real estate market. Here are some details:
- In 2021, Barcelona received €3 billion in real estate investment, surpassing the amount the Capital received in Madrid.
- Despite experiencing an economic downfall during Covid-19, the real estate market in Barcelona has now returned to normal.
- Due to the city’s international potential, Barcelona has become a destination with a strong demand from business travellers, thanks to events like the America World Cup 2024 and the Mobile World Congress.
- Income and quality of life: It is essential to know the different neighbourhoods in Barcelona before making an investment, as the housing prices vary depending on the area. The average income level in the Catalan capital is one of the highest in the country.
Is it Possible for Foreigners to Buy a House in Barcelona?
The answer is yes. In Spain there are no restrictions against foreigners buying a property. So, whether you are a resident in Barcelona or not, you can buy a property, regardless of whether your intention afterwards is to rent or sell it.
Necessary Process to Buy a Property in Barcelona as a Foreigner
In order to buy a house in Spain, it isn’t necessary to be a resident or registered, however, it but you must meet the following requirements:
Documentation: Have an NIE
If you want to invest in real estate in Barcelona and you are a non-resident citizen of the city, the first thing you will need is an NIE.
The NIE (Foreign Identification Number) is the identification number that accredits you as a foreign citizen in Spain. Through this document, you can carry out any legal procedure or economic purposes, such as opening a bank account, paying fees, or buying a house. You can find more information on this website from the Barcelona City Council.
*Due to Brexit, citizens from the United Kingdom will need to process a TIE (Foreign Identity Card), which is equivalent to the NIE.
Having a Spanish Bank Account
If you want to save on bank commissions and inter-bank management expenses, it is recommended that you have a Spanish bank account at the time of purchasing a property in Spain.
While it is not a mandatory requirement, having one will facilitate subsequent procedures since all payments and taxes related to the purchase and management of the property will be debited from that account.
What are the Taxes for Buying a Property?
The process of buying a property involves associated costs and expenses. In Spain , whether you are a native citizen or a foreigner, you must pay the same taxes: Here are the details:
If the property is a new construction, the buyer must pay 10% of the house’s sale price. In the case of official property protection, it will be 4%.
Property Transfer Tax
If the property is second hand, and has previously been registered under someone else’s name, the Property Transfer Tax (ITP) must be applied. In Catalonia, it is 10% of the housing price.
Documentary Stamp Tax
The Documentary Stamp Tax (AJD) is a tax paid by the bank if the property buyer applies for a mortgage or pays in cash. This tax varies depending on the Autonomous Community but it is usually between 0.5% and 1.5%.
In Spain, finalising the purchase of a property must be done before a notary to sign the property registry. Therefore, when buying a home in Barcelona, in addition to the mentioned taxes, you will need to cover the notary fees.
What is the Golden Visa and How will it Benefit Me?
Since 2013, Spain has been a part of the government’s Golden Visa project, which focuses on encouraging foreign investment and giving support to young entrepreneurs. The Golden Visa offers the possibility to obtain a visa and residence permit to investors from outside of the European Union, as long as they make a real estate investment of more than €500,000.
This visa gives you the right to live, work and study in Spain. If you need assistance with the process of obtaining the Golden Visa, at AB Apartment Barcelona we collaborate with the law Firm, Nomads Barcelona, who specialise in the management of procedures and visas.
The Property’s Features
Once you have considered all of the previous points, you should create a list of requirements with the features that you are looking for in a property. Here are some ideas:
- Number of rooms and bathrooms
- Layout and lighting of the space
- Proximity to services: schools, public transport, supermarkets, pharmacies…
- Parking availability
- Location: Barcelona consists of 10 districts with lots of variety between them. The most sought after neighbourhoods for investors are Eixample, Poblenou, Sarrià-Sant Gervasi, among others
- Building Amenities: Elevator, terrace, swimming pool…
All of this will contribute to the fluctuation in housing prices and, therefore, their value. Check out our tips for saving up to buy a property!
If you are a foreigner and are thinking of purchasing a house in Barcelona, get some support from an expert agency in the sector, like AB Apartment Barcelona, it will be the best thing for your investment.