Selling your property in Spain: the sales process explained

Selling property in Spain is a bureaucratic process that on average 2 to 4 months takes. The legal transfer consists of three crucial stages: the reservation contract, the private sale agreement (compromise) and the notarial act (Escritura). As a non-resident, you need to consider specific tax obligations, such as the 3% withholding on the sale price as an advance on profit tax.

1. Sell your property in Spain yourself or engage an estate agent?

Is it wise to sell in Spain without an estate agent? Although it is legally permitted to sell your property yourself ("Trato directo"), for non-residents in 90% of cases the use of an authorised broker (Agente de la Propiedad Inmobiliaria). The Spanish property market is fragmented and requires local presence.

• Selling yourself: Only recommended for a direct sale to an acquaintance or family. You save commission but bear the full risk for marketing and viewings.

• Through a broker: An estate agent will ensure correct valuation, legal filtering of buyers and key management.

  • Note: Brokerage commissions in Spain are usually between 3% and 6%+ VAT and are generally paid by the seller.

Expert tip: "Choose an estate agent who is a member of a professional body. This ensures the valuation is based on recent market data and not 'wet finger work'."

Learn more about selling Spanish property without an estate agent here.

2. The legal preliminary phase: Reservation and Compromise

What is the difference between the reservation contract and the compromise? The reservation contract temporarily takes the property off the market for a small down payment, while the compromise (Contrato de Arras) is the final legal commitment with a down payment of 10%.

The Reservation Contract

Once the price is agreed, you sign the reservation contract.

• Objective: Blocking the property for other interested parties.

• Costs: The buyer pays a reservation fee, usually between €3,000 and €10,000.

• Function: This gives the buyer's lawyer time to make a Due Diligence (legal investigation) into debts and property rights.

Read more about costs when selling your Spanish property.

The Compromise (Contrato de Arras)

If the legal investigation is positive, the compromise follows.

• Down payment: The buyer shall pay an advance of 10% of the purchase price (minus the reservation already paid).

• Binding: After signing, parties cannot get out of the sale free of charge.

Warning: Tick never immediate compromise without prior legal research. In practice, we see files go awry where a compromise was signed while the property was still in an unfinished estate. This prevented the seller from delivering on time, resulting in contractual penalties.

3. The Notarial Deed and the 3% Withholding

How does the transfer take place at the Spanish notary? The final transfer will take place at the signing of the Escritura de Compraventa. The buyer pays the balance - usually via a guaranteed bank cheque - and receives the keys.

Tax concerns for non-residents when selling your property in Spain

If you are not resident in Spain for tax purposes, you will receive not the full sale price.

• The 3% Rule: The buyer is legally obliged to 3% of the sale price withhold.

• Remittance: The buyer must remit this amount to the Spanish tax authorities within 30 days (Hacienda) via Modelo 211.

• Objective: This serves as an advance on your profit tax (capital gains tax), if any.

• Return: Is the actual profit tax less than the 3% withheld? Then your lawyer will file a refund claim.

Read more about capital gains tax.

Cancel mortgage

Do you still have a current mortgage? A representative of your bank must be physically present at the notary to cancel the mortgage deed (Cancelación de Hipoteca). The outstanding balance will be settled directly against the buyer's bank cheque.

4. After the sale: taxes and formalities

What costs are involved after the sale? After passing the deed, you are not completely finished. You will be responsible for completing two specific tax and administrative tasks.

1. Plusvalía Municipal: A municipal tax on land appreciation. It must be paid within 30 days. Read more about the plusvalia tax.

2. Value-added tax: The difference between your purchase and sale price. For non-residents, this rate is 19% on net profit (within the EU).

   • Settlement: The 3% already retained will be deducted from this.

Administrative handling:

• Ending contracts utilities (water, electricity).

• Insurance cancellation.

• Inform the Owners' Association (Comunidad de Propietarios).

• Inform the municipality (cadastre).

Checklist: Required documents for sale

To avoid delays, complete the file below before putting the property up for sale.

Read more about selling in Spain.

Property documents:

• Original notarised deed of purchase (Escritura).

• Note Simple (recent extract from the property register).

• Licencia de Primera o Segunda Ocupación (residential licence).

• EPC certificate (Energy performance certificate) (CEE).

• Inventory list of furniture included.
• Articles of association and last four minutes of the general meeting of co-owners (if applicable).

Financial documents:

• Proof payment of property tax (IBI) from the last four years.

• Recent utility bills (water, electricity).

• Certificate of the Comunidad (Proof that there are no outstanding debts with the VME) (if applicable).

• Attestation outstanding balance of mortgage (if applicable)

Personal documents:

• Passport/ID card.

• NIE number certificates.

• Fiscal residency certificate (if applicable).

• Spanish bank account details (IBAN) (if applicable).

• If sale through company: attestation NIF number

Frequently asked questions (FAQ)

How long will it take to receive my money after selling in Spain?

At the notary, you will immediately receive the bank cheque. Cashing this into your account is possible, depending on the bank, 3 to 7 working days last. We do not recommend accepting a non-Spanish cheque or collecting and Spanish bank cheque from a non-Spanish bank.

Will I always get the 3% deduction back?

No, the 3% is an advance on capital gains tax. If you made a profit on the sale, the tax due (19% for EU residents) will be offset against this 3%. If the capital gains tax is lower than the amount withheld, you will get the difference back. If the tax is higher, you will have to make an additional payment.

Am I required to have an energy label (EPC) when selling?

Yes, since 2013 it has been Certificado de Eficiencia Energética mandatory when selling or letting property in Spain. Without this certificate, the deed cannot be notarised.

Can I pass on the 'Plusvalía' tax to the buyer?

Legally, the Plusvalía Municipal a burden on the seller (because you are the one who has benefited from the increase in value of the land). Although freedom of contract exists, buyers rarely accept passing on these costs.

About the author: Glenn Janssens is a lawyer specialising in Spanish real estate transactions and tax regulations. Since 2017, he has been helping Belgian and Dutch individuals and entrepreneurs to safely purchase and structure real estate in Spain. He guides files from A to Z: from due diligence, ownership and tax control to estate planning and optimisation for residents and non-residents. Thanks to his years of experience, hundreds of handled files and focus on transparent communication, Glenn makes complex Spanish legislation understandable and practically applicable for every property buyer.