Why you don't buy a house in your first year
The most expensive mistake in any emigration isn't a forgotten form but a purchase made too early: a house bought before you knew the country, the neighbourhood and your own new life. Rent first — this is why that order is fixed.
4 min read
Written and checked by Auke on , against the sources at the bottom. Is something no longer right? Report it below and I'll fix it.
Don't buy a house in your first year in Spain: rent. On this site that isn't a tip but an order: rent first, buy later, and the first year is not negotiable. It applies to Spain, to Australia and to every destination after that.
No authority forbids you to buy. This isn't regulation, but the sum of how emigrations really go. And of what a mispurchase in Spain demonstrably costs:
- 6% transfer tax in Madrid on buying;
- plusvalía on selling, a municipal tax on the increase in the value of the land;
- notary, registry and advisers on both sides.
What you don't know yet, you can't buy
Buying a house is a bet on knowledge you simply don't have on arrival. Which neighbourhood gets unbearably hot in summer and which street lies under the flight path. How the commute really feels in week thirty, rather than in the holiday week you came to look. Whether the school the children were waiting for is also the school where they want to stay. Whether you settle in there at all.
That last one isn't doom-thinking but planning. A share of emigrations is reversed in the first years or shifted to another region. That's no failure: it's precisely what you want to be flexible for. A rental contract ends; a house has to be sold, remotely if things go badly.
What does a mispurchase cost?
Put two figures side by side. On one side a year's rent. That money is gone, that's right, and it feels like the argument to buy quickly. On the other side the costs of buying and selling again. In Spain those are simply in the law and the regional tariffs:
| Item | What it is | Amount or term |
|---|---|---|
| Transfer tax (ITP) on buying | paid by the buyer, per comunidad | Madrid 6% of the price; higher elsewhere |
| Filing the ITP (modelo 600) | at the comunidad | within 30 working days of the deed |
| Plusvalía on selling | municipal capital gains tax, paid by the seller | filing within 30 working days |
| Entry in the property register | voluntary, but without it you're not a protected owner | 15 working days after submission |
| IBI, every year | municipal property tax | 0.4% to 1.1% of the cadastral value |
| Nota simple before buying | owner, charges, paid IBI and owners' association | available from any register, in English too |
Whoever sells again within two years:
- loses the ITP of the purchase;
- pays the plusvalía as seller;
- pays notary, registry and advisers on both sides.
All that on a decision a year of renting would have corrected for free. Selling under time pressure in a market you don't know does the rest.
A year's rent isn't money thrown away, but the premium of an insurance. The insurance is called: buying with knowledge, in the neighbourhood you've meanwhile really got to know, at your own pace, without time pressure.
Renting is also more practical in your first year
The order has a second layer: on arrival you often literally lack the papers to buy well.
- In Spain a purchase requires your NIE, your Spanish identification number, and a bank account.
- A mortgage requires an income history you haven't yet built up in your new country. According to the national government a mortgage only exists once it's entered in the register.
Whoever rents first registers at their rental address and builds up their file. A year later you sit at the table as a fully-fledged buyer, instead of as a tourist in a hurry.
Do ask the landlord the right question before you sign: whether you may register at the address. In Spain almost everything hangs on it.
When is it allowed?
After that first year buying isn't a mistake but a choice. There are situations where the trade-off is different: whoever returns to a region they've known for years buys with different knowledge than whoever emigrates for the first time.
But even then the test stays the same. Only buy once you can answer the question "why this neighbourhood, this house, this price" with a year of your own experience, instead of an afternoon's viewing.
And then request the nota simple first, an extract from the property register. The national government puts that check of owner, charges and paid taxes emphatically before the signature.
Until then: rent, look, and let the house wait. It won't run away, and if it does, there was a next house. And are you that far? Then first read how buying in Spain really works. There's no notary there who arranges everything for you, and you want to know that before the signature, not after.
In Vertrekklaar this is phase 4 of 5 of the journey, step 4.1: the same steps, but for your situation — in your order, tickable, and with the deadlines watched. See the whole journey to Spain or go straight to step 4.1 in the open plan.
What this rests on
The facts in this article come from these official pages. Rules change. When in doubt, go by the source, not this article.
- Comunidad de Madrid — the transfer tax ITP (modelo 600), rate and deadline — comunidad.madrid
- BOE — Ley de Haciendas Locales, article 72 (IBI rate) and 106 (who pays the plusvalía) — boe.es
- Punto de Acceso General — the nota simple and the registration when buying a home — administracion.gob.es
- Registradores de España — registering a purchase in three steps — registradores.org
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