5 Things to Consider Before Buying Property in Alicante
Introduction
Alicante, with its Mediterranean climate, high quality of life, and still accessible prices, attracts many international buyers each year for a significant life investment. Whether to settle down, invest, or acquire a secondary residence, this destination offers excellent opportunities, provided the transaction is approached with expert rigor.
As local market professionals, we know that anticipating legal and financial pitfalls is key to a successful purchase. Here are the 5 essential points every investor must validate before signing the notarial deed, thereby ensuring the reliability of your acquisition.
1. Absolute Legal Control (Due Diligence)
The first and most critical step is a thorough verification of the property's legal status. This "due diligence" process helps prevent your dream from turning into a financial nightmare. We advise you to focus on the following points:
- Property Title: Is the seller legally the owner of the property, free from any inheritance disputes?
- Encumbrances and Debts: Is the property free from any mortgages, seizures, tax debts (IBI), or community fee arrears?
- Urban Planning Compliance: Does the property have the necessary building permits and is it consistently registered in both the Cadastre and the Property Registry?
- Legality of Extensions: Any undeclared swimming pool, covered terrace, or extension must be legalized (AFO/DAFO) or expressly excluded from the purchase.
Official Resource
For verifying charges and data consistency, the fundamental tool is the Nota Simple from the Property Registry. You can consult official Spanish registries for more details on the property registration and verification process.
Consult the Official Portal of the Property Registries (registradores.org)
2. Local Market Knowledge and Area Selection
The real estate market in Alicante is very diverse. A city-center property will not have the same value as a property on the outskirts, even if the price per square meter seems comparable. A wise purchase depends on the right alignment between your budget, lifestyle, and the chosen neighborhood.
The Province of Alicante is divided into distinct zones that attract different buyer profiles:
| Area | Key Towns/Cities | Target Buyer Profile | Market Highlight |
|---|---|---|---|
| Premium Coastal | Playa de San Juan, Cabo de las Huertas | Second home, high-end investor | Strong seasonal rental demand, construction quality |
| Central Residential | Alicante city center, Benalúa | Young professionals, urban retirees | Proximity to services and transport, year-round living |
| Accessible Outskirts | El Campello, Santa Pola, San Vicente | Families, first-time buyers, seeking peace and space | Better value for money, infrastructure accessibility |
3. Budgeting Acquisition Costs
The most common mistake made by foreign buyers is underestimating additional costs, which are not included in the advertised price. For a secure project, you should budget an extra 10% to 13% of the purchase price to cover taxes and transaction fees.
These costs vary depending on whether the property is new or resale, a point that any real estate expert should clarify upfront.
| Type of Expense | Resale Property (ITP) | New Build Property (IVA) |
|---|---|---|
| Main Tax | ITP (Impuesto sobre Transmisiones Patrimoniales): 10 % | VAT (IVA): 10 % |
| Stamp Duty (AJD) | N/A | AJD: 1.5 % |
| Notary & Registry Fees | ~ 1 % (Variable) | ~ 1 % (Variable) |
| Lawyer's Fees (Optional) | ~ 1 % | ~ 1 % |
| Total Costs (incl. Tax) | ~ 12 % to 13 % | ~ 12.5 % to 13.5 % |
4. NIE and Tourist License: Legal Requirements
Property purchase in Spain cannot proceed without two key documents and licenses, which ensure the legality of your status and your project.
Obtaining the NIE (Número de Identificación de Extranjero)
The NIE is your foreigner identification number. It is mandatory for: signing the notarial deed of purchase, opening a bank account, and paying taxes. Anticipating your application is essential to avoid delaying the transaction.
Tourist Rental Regulations
If you plan short-term rentals, the Valencian Community requires a tourist rental license (VT number). Obtaining this license is subject to strict conditions (safety standards, equipment) and may be refused in areas considered "saturated". Verification of the possibility of obtaining this license must be done before purchase.
5. The Role of the Expert in Securing Your Purchase
The Independent Lawyer: Your Best Assurance
The most common mistake we observe is cutting corners on an independent lawyer. For a significant transaction, a specialized lawyer is your sole guarantor that the property is free of encumbrances and complies with urban planning law. Never sign a purchase promise or pay a deposit ("arras") without their approval or before due diligence checks are complete.
Conclusion
Buying in Alicante is an excellent investment. The market offers a wide variety of properties and an exceptional living environment. To turn this potential into success, you must master five key points: legal security, local market knowledge, cost control, NIE acquisition, and verification of tourist licenses.
Engaging local professionals for all these steps demonstrates a well-considered and secure investment. We are here to guide you through the complexities of the Spanish market and ensure the reliability of your project.
Article Summary
- Introduction
- 1. Absolute Legal Control (Due Diligence)
- 2. Local Market Knowledge and Area Selection
- 3. Budgeting Acquisition Costs
- 4. NIE and Tourist License: Legal Requirements
- Obtaining the NIE (Número de Identificación de Extranjero)
- Tourist Rental Regulations
- 5. The Role of the Expert in Securing Your Purchase
- Conclusion
FAQ : Property Acquisition in Alicante: Securing Your Investment in Spain
Investing in Alicante offers exceptional opportunities in a Mediterranean setting. Understanding legal due diligence, taxation, and administrative procedures is essential for a smooth acquisition.
- The identity of the registered owner in the Registro de la Propiedad (Spanish Land Registry).
- The absence of non-consenting co-owners or third-party rights.
- The conformity between the title deed data and the physical reality of the property.
| Area | Key Towns | Target Buyer Profile | Market Highlight |
|---|---|---|---|
| Prestigious Coastal | Playa de San Juan, Cabo de las Huertas | Second home, high-end investor | Strong seasonal rental demand, quality construction |
| Central Residential | Alicante city centre, Benalúa | Young professionals, urban retirees | Proximity to services and transport, lively year-round atmosphere |
| Accessible Outskirts | El Campello, Santa Pola, San Vicente | Families, first-time buyers, seeking peace and space | Best value for money, good infrastructure |
- Resale Property: You will pay ITP (Impuesto sobre Transmisiones Patrimoniales), the Property Transfer Tax, which is 10% in the Valencian Community.
- New-Build Property: You will be subject to VAT (IVA - Impuesto sobre el Valor Añadido), at a rate of 10%, and AJD (Actos Jurídicos Documentados), the Stamp Duty equivalent for documented legal acts, which is 1.5%.
- Signing the public deed of purchase (escritura).
- Opening a Spanish bank account.
- Paying any property-related taxes.
