Buying Property in Spain as an Iranian: A Guide for Iranians Abroad

Can an Iranian buy property in Spain?

In general, yes. Spain allows non-residents and non-EU citizens to purchase property. An Iranian citizen does not need to become a Spanish resident before buying a normal house or apartment. That makes Spain quite different from countries that impose broad foreign-buyer prohibitions. However, buying as a non-resident creates additional administrative, tax and banking considerations.

Spain’s foreign-investment regulations also require certain investments to be declared. For example, a non-resident acquisition of Spanish real estate exceeding €500,000 falls within the foreign-investment reporting framework and generally has to be declared to Spain’s Investment Registry after the transaction. This is a reporting requirement, not a general €500,000 limit on how much a foreign buyer may spend.

What about the proposed 100% tax on non-EU buyers?

This subject has generated many headlines and considerable confusion. The Spanish government previously proposed substantially increasing the tax burden on residential property purchases by certain non-EU, non-resident buyers, with political announcements referring to taxation of up to 100% of the property’s value.

But that proposal has not become a general tax currently charged to Iranian buyers. The measure stalled in parliament and was not part of the law currently governing ordinary foreign purchases. So an Iranian living outside the European Union should not assume that purchasing a €300,000 Spanish apartment currently means paying another €300,000 in a special foreign-buyer tax.

At the same time, Spanish housing policy is changing quickly. Anyone making a substantial investment should verify the rule again shortly before signing a purchase agreement rather than relying on an article written months or years earlier.

Buying property no longer gives you Spain’s Golden Visa

This is another area where older property websites can be misleading. Spain previously offered an investor-residence route commonly called the Golden Visa, and purchasing qualifying Spanish property was one way to access it. That property-based investor route has been abolished.

The sections of Spain’s law dealing with investor visas and investor residence permits were removed with effect from 3 April 2025. So purchasing a €500,000, €1 million or more expensive home in Spain does not now automatically give a new buyer a Golden Visa. Buying property and obtaining Spanish residence are separate matters.

Someone planning to move to Spain may still qualify for another residence route depending on their circumstances, but the property purchase itself is no longer the immigration program that it once was. This distinction is especially important because many older articles and promotional pages still associate Spanish real estate with residency.

You will normally need an NIE

One of the first practical steps for a foreign buyer is obtaining an NIE, or Número de Identidad de Extranjero. The NIE is the personal identification number Spain assigns to foreigners who have economic, professional or social dealings with the country. Spain’s Interior Ministry explains that it is the foreigner’s identifying number for relevant documents and procedures.

A person does not have to become a Spanish resident simply to obtain an NIE. For someone living abroad, the process can generally be initiated through the appropriate Spanish authorities, including Spanish consular channels in the country of residence. In practice, the NIE becomes important for property transactions, taxes and many related administrative processes.

Do not skip independent legal checks

Buying a home in Spain should not begin and end with the estate agent. Before committing substantial money, the buyer should verify who legally owns the property and whether debts, mortgages, legal restrictions or other rights are registered against it. Spain’s Property Registry can provide this information through the Nota Simple, an extract containing important information about the property’s registered ownership and charges.

It is also important to check matters that might not be obvious from a viewing, such as planning status, community-of-owners debts, pending building costs and whether the intended use of the property is actually permitted. This becomes particularly important when the investment strategy depends on renting the property to tourists. The apartment may be legally yours while the business model you planned for it is not legally permitted.

Reservation payments and arras contracts deserve attention

Spanish property transactions often involve an initial reservation agreement or an arras contract, under which the buyer pays a deposit before the final deed is signed. This should not be treated like casually putting down a refundable holding deposit. The legal consequences can depend on the wording and type of agreement.

For a buyer relying on mortgage financing, one particularly important question is what happens to the deposit if the bank later refuses the mortgage. That condition should be understood before transferring the money. An independent lawyer representing the buyer can be especially valuable at this stage rather than becoming involved only shortly before completion.

New properties and resale properties are taxed differently

One of the most important things to understand about buying in Spain is that there is no single property-purchase tax that applies everywhere. Whether the property is new or second-hand makes a major difference. When purchasing a newly built residential property directly from a developer, the purchase is generally subject to 10% VAT, or IVA.

A resale property purchased from a private owner is generally instead subject to Transfer Tax, or ITP. And ITP is administered by Spain’s autonomous communities, which means the applicable rates and available reductions depend on where the property is located. Stamp duty, known as AJD, can also apply in relevant transactions and is likewise affected by regional rules. This is why statements such as “property purchase tax in Spain is 10%” can be misleading.

The answer can be different in Madrid, Catalonia, Andalusia, Valencia and other autonomous communities. Before comparing two investments, calculate the purchase costs according to the specific property and region, not a national average found online.

The cheapest property may not have the lowest total cost

Suppose you are comparing a €300,000 apartment in one region with a €320,000 apartment somewhere else. The first property may initially look cheaper. But different transfer-tax rates, community fees, local property taxes, renovation needs and rental restrictions can reverse the result. For investment purposes, the better calculation is not simply: Which apartment has the lower asking price?

It is: How much money will I have invested by the time the property is legally purchased, prepared for use and generating income? That figure should include taxes, legal expenses, financing costs, renovation where required and enough reserve for unexpected problems.

Can a non-resident get a mortgage in Spain?

Yes. Spanish banks do finance foreign buyers and non-residents. But non-residents should not assume they will receive the same financing terms as someone living and earning income in Spain. There is no single legal mortgage percentage that applies to all non-residents. Banks make their own credit decisions based on income, debt, residence, currency, property value and the borrower’s overall financial profile.

As an example of current bank practice, CaixaBank’s HolaBank mortgage for international buyers advertises financing of up to 70% of the property’s value. That means the buyer may need substantially more than a 20% deposit. If a bank finances 60% or 70%, the buyer has to provide the rest of the purchase price plus the taxes and transaction costs from their own funds. For a €400,000 property, that can require a significant amount of liquid capital before the transaction even begins.

Your country of residence can matter to the bank

For the Iranian diaspora, “Iranian buyer” is too broad a description for mortgage purposes. Consider three buyers who all hold Iranian passports: One lives and works permanently in Germany and earns euros. Another lives in Canada and earns Canadian dollars. A third lives in Iran and receives income through the Iranian financial system.

They may be interested in exactly the same Spanish apartment, but a Spanish lender may evaluate the three applications very differently. Banks look at factors such as the currency of the applicant’s income, employment stability, tax returns, existing loans, bank statements and whether documents and financial transfers can be independently verified. This is why mortgage eligibility should ideally be investigated before signing an unconditional purchase commitment.

For Iranian buyers, source of funds deserves special attention

This is one of the most important parts of the process for Iranians considering property in Spain. Iran remains on the European Union’s list of high-risk third countries for anti-money-laundering purposes. The EU also maintains restrictive measures and sanctions relating to Iran, including rules affecting certain designated individuals, entities and financial relationships. This does not mean that an Iranian is prohibited from buying a home in Spain.

An Iranian living and working in Germany who accumulated €150,000 through documented employment and a European bank account presents a very different financial profile from someone attempting to move a large amount of money from Iran through several intermediaries. For legitimate buyers, the important issue is being able to explain clearly: Where did the money come from?

Salary savings, business income, an inheritance, investment proceeds or the sale of another property can all have legitimate explanations. But the documentation supporting those explanations can become important. Bank statements, tax returns, employment records, business accounts, inheritance documents and property-sale contracts can help establish the source of wealth and source of funds.

Avoid complicated informal transfers

For buyers with funds connected to Iran, attempting to make a transaction look simpler by routing money through several unrelated people can actually make it much more difficult. Spanish banks, notaries and other regulated professionals can have anti-money-laundering responsibilities.

A payment that arrives from an unrelated person or passes through a complicated series of accounts can create obvious questions about beneficial ownership and the true source of the money. If a significant portion of the purchase funds originates in Iran, the practical banking route should be investigated before signing the property contract. The worst time to discover that a bank will not accept a particular transfer is shortly before the notary appointment when a substantial deposit has already been paid.

Spain and Iran have a double-tax treaty

There is an important difference between Spain and some other destinations discussed by Iranian investors. Spain and Iran have a bilateral agreement for the avoidance of double taxation. Under that treaty, income earned by an Iranian tax resident from real estate located in Spain may be taxed in Spain.

The treaty also allows Spain to tax gains from Spanish real estate under the relevant provisions. However, for the Iranian diaspora, tax residence can matter more than nationality. An Iranian living permanently and paying tax in Germany should normally consider Spain’s tax relationship with Germany.

An Iranian who is tax-resident in the UAE should examine their situation from that perspective. An Iranian who is actually tax-resident in Iran may need to consider the Spain-Iran treaty. Do not determine cross-border taxation simply by looking at the passport you hold.

Non-resident landlords pay Spanish tax on rental income

If you live outside Spain but rent out Spanish property, the rental income is generally taxable in Spain. One particularly important distinction is where the landlord is tax-resident. Under Spain’s current non-resident income-tax rules, residents of the EU, Iceland, Norway and Liechtenstein generally face a 19% tax rate on qualifying Spanish real-estate rental income and can deduct eligible expenses that are directly connected with generating that Spanish income.

For other non-resident taxpayers, the general rate is 24%, and the expense-deduction treatment is less favourable under the domestic rules. That creates an important difference within the Iranian diaspora. An Iranian tax-resident in Germany may not receive the same Spanish rental-tax treatment as an Iranian tax-resident in Canada, Turkey, the UAE or Iran. Again, tax residence matters.

Gross rent is not your investment return

Suppose a Spanish apartment rents for €1,500 per month. That produces €18,000 of gross annual rent. But €18,000 is not the investor’s profit. Community fees, property tax, insurance, repairs, management fees, mortgage interest, periods without tenants and non-resident income tax can all reduce the result.

If the property is managed from another country, professional management may also be necessary. The number investors should care about is what remains after recurring costs and tax, not the amount appearing in the rental advertisement.

Owning an empty Spanish property can still create tax

A non-resident individual may also have Spanish tax obligations when an urban property is available for their own use rather than rented. Spain has an imputed real-estate income system for certain non-resident owners. Instead of requiring actual rental income, the system calculates an imputed amount based on the property’s cadastral value and applies the relevant non-resident tax rules.

In addition, owners normally have local property costs such as IBI, community charges where applicable, insurance and maintenance. So buying a holiday apartment and leaving it empty does not mean the annual ownership cost is zero.

Be especially careful if the investment depends on Airbnb or tourist rentals

Spain’s tourism market makes short-term rental investment look attractive. But buying an apartment does not automatically give the owner permission to operate it as tourist accommodation. Regional and municipal tourism rules can impose licensing, registration and zoning requirements. There is now another significant restriction for properties forming part of a community of owners.

For newly initiated tourist-rental activity under the relevant rules, an owner must obtain express approval from the community of owners, requiring support from three-fifths of all owners who also represent three-fifths of the participation quotas. The new requirement took effect on 3 April 2025, with transitional protection for certain lawful existing activities.

For an investor, this has a major consequence: Never buy a property based on projected Airbnb income before confirming that the property can legally be used for that purpose. An estate agent telling you that “many apartments in this area are rented to tourists” is not sufficient due diligence.

Long-term rental rules are different

Long-term residential renting operates under a different legal framework. Spain’s housing and rental rules can vary depending on location and whether an area has been declared a stressed residential market. Rent regulation, tenant protections and landlord obligations can therefore differ depending on the autonomous community and municipality.

For a property investor, this means the legal environment should be examined alongside rental yield. A property with a slightly higher advertised return can be less attractive if the investor misunderstands the rules governing rent increases, contracts or possession.

Madrid, Barcelona, Valencia or the coast?

There is no single Spanish property market. Madrid has a large employment base and substantial long-term residential demand. Barcelona combines international demand with a highly regulated housing and tourist-accommodation environment. Valencia and Alicante attract both domestic and international buyers, while coastal areas can have a much stronger seasonal and tourism component.

Málaga and the Costa del Sol have substantial international demand and a large second-home market. The Balearic and Canary Islands have their own supply constraints, local regulations and tourism dynamics. An apartment that works as a long-term rental in Madrid should therefore not be evaluated using the same assumptions as a holiday property on the Costa del Sol.

Spanish house prices have been rising strongly

Spain is not currently a market where investors should automatically expect to find inexpensive property simply because it was cheaper than northern Europe in the past. The latest official national Housing Price Index showed prices 12.2% higher than a year earlier. Prices for second-hand homes were 12.9% higher, while new-home prices were 7.4% higher. That does not mean every neighbourhood rose by 12.2%.

National figures combine very different markets. But it does mean buyers should be cautious about assuming Spain is automatically a “cheap” property market. Rapid recent appreciation can improve returns for existing owners while making the entry calculation more difficult for new investors.

Do not invest only because you expect prices to continue rising

Property prices can rise for many years and still experience corrections. Interest rates, housing construction, tourism, employment, immigration, government regulation and credit conditions can all affect the market. An investment becomes much more speculative when it only works financially if property prices continue rising rapidly.

A stronger property should still make sense under less optimistic assumptions. Ask what happens if the property’s value remains unchanged for five years. Ask whether the rental income still covers an acceptable portion of the costs. And ask whether you would still want to own the property if selling quickly became difficult.

High-value property can create Wealth Tax questions

Wealthier investors need to consider another Spanish tax that is sometimes overlooked. Non-residents can be subject to Spanish Wealth Tax on relevant property and assets situated in Spain. Under the general state framework, non-residents subject to the tax have a €700,000 exempt minimum, although regional rules and individual circumstances can affect the calculation.

This does not mean every person purchasing a €700,001 house suddenly pays tax on the entire property value. Debt, ownership percentages, regional provisions and the broader calculation matter. But someone considering expensive Spanish real estate or several properties should include wealth taxation in professional tax planning instead of discovering it later.

Selling a Spanish property as a non-resident has its own tax procedure

Investors should understand the exit before they enter. When a non-resident sells Spanish property, the buyer generally has to withhold 3% of the agreed sale price and pay it to the Spanish tax authorities using the appropriate procedure. That 3% is a payment on account of the seller’s eventual Spanish tax liability. It is not necessarily the final amount of tax.

If the withholding exceeds the actual tax due on the capital gain, the non-resident seller can potentially claim the excess back. This is important for cash-flow planning. Selling a €500,000 property does not necessarily mean €500,000 immediately reaches the seller at completion.

Some non-EU buyers should also check defence-zone restrictions

There is one less common issue that can matter in particular locations. Spain has rules restricting certain foreign ownership in areas designated as being important to national defence. These rules can be relevant to some non-EU buyers in specific geographical areas and for certain types of land.

For most people buying an ordinary apartment in a major Spanish city this will not be the central issue, but buyers considering unusual plots, rural property, islands or sensitive coastal locations should have their lawyer check whether any special authorization is required. It is another reason why a foreign buyer should not rely solely on a real-estate advertisement.

Finding Persian-speaking property professionals through Abhavij

Buying property in Spain can involve an estate agent, lawyer, mortgage adviser, tax specialist, property manager and sometimes a rental-management company. For Iranian and Persian-speaking buyers, working with professionals who can communicate in Persian can make parts of the process easier, particularly when dealing with an unfamiliar legal and financial system.

Abhavij’s Real Estate & Rentals directory helps people discover Iranian and Persian-speaking real estate agents, property professionals, rental businesses and related services in their area. The directory is also for businesses.

If you are an Iranian or Persian-speaking estate agent, property manager, rental professional, mortgage specialist, property consultant or another real-estate business in Spain or elsewhere in the diaspora, you can add your business to Abhavij so Persian-speaking customers can find you locally. And buying the property is only the beginning.

Owners eventually need renovation, painting, plumbing, electrical work, cleaning, moving, maintenance and other services. Iranian and Persian-speaking professionals working in these fields can also list their businesses in Abhavij’s Home Services directory. This creates a connection between people looking for property and the local Persian-speaking businesses that can help them buy, rent, maintain and improve it.

What should you calculate before investing?

The first useful calculation is usually the gross rental yield: Annual rental income ÷ total purchase price × 100 .But a more realistic calculation should include the property’s purchase tax, mortgage interest, community charges, local property tax, insurance, management, maintenance, vacancy, income tax and the eventual costs of selling. For an overseas buyer, currency risk should also be considered.

An Iranian living in Canada, for example, may be investing wealth measured primarily in Canadian dollars while purchasing an asset denominated in euros. Someone living in the UK may be comparing the investment in pounds. Someone in Germany already earning and saving in euros faces a different currency situation. Property eliminates neither exchange-rate risk nor cross-border tax complexity.

Five questions to ask before buying

Before committing to Spanish property, an Iranian buyer should be able to answer five basic questions: What will the property really cost after regional taxes and transaction costs? Where am I tax-resident, and how will Spain tax my rental income and eventual sale? Can I document the legitimate source and transfer path of all the money involved?

Is the rental strategy I am planning actually permitted for this particular property? Would I still be comfortable owning it if rents or property prices performed worse than expected? If the investment continues to look attractive after answering those questions, it deserves further investigation. If the numbers only work because the buyer assumes rapidly increasing property prices, constant tourist occupancy and very low expenses, the investment may be much riskier than it first appears.

Is Spain a good real-estate investment for Iranians?

For some members of the Iranian diaspora, Spain can be an attractive part of a long-term property strategy. But “Iranian investor” describes people in very different circumstances. An Iranian living in Germany and earning euros may have straightforward access to European banking and different Spanish rental-tax treatment. An Iranian living in Dubai may face a different mortgage and tax situation.

An Iranian living in Iran and attempting to finance a Spanish purchase with Iranian-source funds may face substantially more banking and compliance complexity. A family buying a second home in Valencia has different priorities from someone buying a Madrid apartment for long-term rent or a Málaga property intended for tourists.

This article is intended for general educational information. Spanish property, tax, rental, immigration and financial regulations can change, and autonomous communities and municipalities can have different rules. Individual tax residence, banking and sanctions circumstances also matter. Always verify your situation with qualified Spanish legal and tax professionals before making an investment.