The housing market in Spain: renting or buying as a new resident

Updated: October 2026

Finding somewhere to live is usually the biggest decision – and the biggest expense – when you move to Spain. This guide is for new residents weighing up whether to rent or buy, and where. It covers how the market behaves, what renting and buying really cost on top of the headline price, recent rule changes and how the main regions differ.

How the Spanish housing market looks in 2026

Spain’s housing market has been under pressure for several years. Demand from local households, foreign buyers and investors has grown faster than the number of new homes being built, and prices and rents have risen strongly in the big cities, on the coasts and on the islands. Affordability, especially for young people and renters, is one of the most debated political topics in the country.

For reliable figures, use official sources rather than portal headlines. The National Statistics Institute (INE) publishes a quarterly housing price index (Índice de Precios de Vivienda) broken down by region and by new versus second-hand homes, and the notaries’ and land registrars’ associations publish their own data on actual sale prices. Asking prices on property portals are often well above what homes actually sell for.

• Tightest markets: Madrid, Barcelona, Málaga and the Costa del Sol, the Balearic Islands, the Canary Islands, Valencia and the Basque Country.
• More affordable: inland Andalucía, Extremadura, Castilla-La Mancha, Castilla y León, Murcia’s interior and much of Galicia and Asturias.
• Short supply of rentals: in popular areas, long-term rentals can be scarce because many homes are used as holiday lets.

Renting first: what to expect

Most newcomers rent for the first year or two. It lets you get to know neighbourhoods, schools and commuting times before you commit, and many residence routes require proof of an address anyway.

• Contract length: long-term residential leases (vivienda habitual) give tenants the right to extend year by year up to five years when the landlord is a private person, or seven years when the landlord is a company.
• Deposit: the legal deposit (fianza) is one month’s rent; landlords may ask for limited extra guarantees on top.
• Agency fees: under the 2023 Housing Law, estate agency fees for a residential lease are paid by the landlord, not the tenant.
• Seasonal contracts: short “temporada” contracts are meant for genuine temporary stays (work, study). Be cautious if you are offered one for a home you plan to live in long term.

Our detailed guide to renting in Spain as a foreigner covers documents, contracts and tenant rights step by step.

Buying property: the real cost

Foreigners, EU or not, can buy property in Spain freely. You need an NIE (foreigner identification number) and a Spanish bank account, and it is strongly recommended to use an independent lawyer who checks the land registry, debts, planning status and community fees before you sign anything.

Taxes and fees on top of the price

• Resale homes: transfer tax (ITP), set by each region. In Andalucía it is a flat 7%; other regions charge different rates.
• New builds: VAT (IVA) of 10% on homes (different rates apply in the Canary Islands), plus stamp duty (AJD), also set regionally.
• Notary, land registry and legal fees: add these on top; a lawyer usually charges a percentage or fixed fee.
• Mortgage costs: valuation and possibly insurance. Banks usually lend non-residents a lower share of the value than residents.

A common rule of thumb is to budget roughly 10–13% of the price for taxes and fees on a resale home, but calculate it for your region. After you buy, you will also pay yearly local and national taxes – see our guide to property taxes for foreign owners.

The golden visa has ended

Older guides still mention residency for buying property worth €500,000 or more. Spain abolished this “golden visa” route with effect from April 2025, so buying a home no longer gives non-EU citizens a right to live in Spain. You need a separate residence route – see becoming a resident in Spain.

Renting versus buying at a glance

Aspect	Renting	Buying
Upfront cost	One month’s deposit plus any extra guarantee and the first month	Deposit (often 20–30% for non-residents) plus roughly 10–13% taxes and fees
Flexibility	High – easier to move area or leave Spain	Low – selling takes time and costs money
Maintenance	Landlord pays for major repairs	Owner pays everything, plus community fees
Residency	Rental contract helps prove an address	No residence right linked to buying since 2025
Best for	First years, uncertain plans, high-price cities	Long-term stay, stable income, clear choice of area

Rules investors and holiday-let owners should know

• Tourist lets: holiday rentals need a regional tourist licence and, since 2025, registration in the national rental register. Many cities, including Barcelona, Madrid and Málaga, restrict new licences in certain areas.
• Community approval: since April 2025, starting a new tourist let in an apartment block requires approval by the owners’ community.
• Stressed areas: regions can declare “zonas tensionadas” where rent rises for new contracts are limited.
• Rental income tax: non-resident owners must declare rental income in Spain; residents declare it in their annual income tax return.

Choosing a region

Think about work, schools, healthcare, airport access and community before price per square metre. The Costa del Sol and Costa Blanca have large international communities and good flight links but high demand. Valencia offers city life with a beach at a lower price than Madrid or Barcelona, though it has become much more expensive in recent years. Inland towns and the north are far cheaper but quieter and more Spanish-speaking. Our cost of living guide helps compare overall budgets.

Useful links

• INE – National Statistics Institute (housing price index)
• Renting in Spain as a foreigner
• Property taxes for foreign owners
• Opening a bank account in Spain
• Becoming a resident in Spain

FAQ: housing in Spain

Can foreigners buy property in Spain?

Yes. There are no general restrictions on foreign buyers. You need an NIE and should use an independent lawyer to check the property before signing.

Does buying a home give me residency?

No longer. The property-based golden visa ended in April 2025. Non-EU citizens need another residence route, such as a work, non-lucrative or digital nomad visa.

Who pays the estate agent when I rent?

For a long-term residential lease, the 2023 Housing Law says the landlord pays the agency fees. Be wary of agents who ask tenants for a fee.

Should I rent or buy when I first arrive?

Most people rent first for at least a year. It gives you time to learn the area and the market before making a large, hard-to-reverse purchase.

Disclaimer: This article is general information only and is not legal, tax or financial advice. Housing rules, tax rates and prices change and vary by region – always check with an independent lawyer or the official source before you sign.