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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.

Rather have everything for Spain on one list?

Then we'll send you the departure checklist for Spain, with every step in order, and five mails about the pitfalls and the real costs. You can switch it off at any time.

We use your address, and your departure date if you fill it in, only for the checklist, the guide and the mails after it. You can unsubscribe under every mail.

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.

Want to know more about this?

Then we'll send you the departure checklist for Spain, with every step in order, and five mails about the pitfalls and the real costs. You can switch it off at any time.

We use your address, and your departure date if you fill it in, only for the checklist, the guide and the mails after it. You can unsubscribe under every mail.

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.

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