Buying Property in Mallorca

Buying Property in Mallorca

Buying property in Mallorca can be a complex process, especially for international buyers. Unlike in some countries, Spain does not have a centralized property database or uniform regulation of real estate agents, so professional guidance is essential for a safe and secure purchase.

Working with an experienced local agent gives you access to a wide range of properties in areas such as Palma, Calvià, Andratx, or Alcúdia, as well as support throughout the entire process, from property search to signing the final deed.

1. Making a Purchase Offer

Once you have chosen a property, the first step is to submit a written offer, usually through a real estate agent.

It is common to accompany the offer with a deposit (€6,000–€20,000) as a sign of interest. If the seller accepts, a private contract (contrato de arras) is signed, where approximately 10% of the purchase price is paid.

The typical timeframe for signing the final deed before a notary is 30 to 45 days.

Recommendations:

• Make a realistic offer based on market value
• Clearly define what is included in the sale (furniture, equipment, etc.)
• Hire a lawyer to review all documentation

2. Purchase Process

The standard process includes:

• Property reservation (≈1% of the price)
• Signing the private contract (≈10%)
• Signing the public deed before a notary
• Registering the property in your name
• NIE (Foreigner Identification Number), mandatory for all foreign buyers in Spain

Residency

Residency is not required to buy property, but it is necessary if you plan to live in Spain for more than 183 days per year.

3. Purchase Costs and Taxes

Total costs generally range between 10% and 12% of the purchase price.

New Property:

• VAT: 10%
• Stamp Duty (AJD): ~1.5% in the Balearic Islands

Resale Property:

• Transfer Tax (ITP): 8%–11% (depending on property value in the Balearics)

Other Costs:

• Notary and Registration: ~0.5%
• Lawyer: ~1%

4. Annual Property Taxes and Expenses

• IBI (Property Tax): Depends on cadastral value and municipality
• Community Fees: For maintenance of shared areas in urbanizations
• Garbage Tax: Mandatory municipal fee

5. Taxes for Non-Residents

Non-resident owners must pay the Non-Resident Income Tax (IRNR):

If not renting: calculated on imputed income (1.1%–2% of cadastral value)

• Rate: 19% (EU residents), 24% (non-EU residents)

If renting:

• EU: 19% on net income
• Non-EU: 24% on gross income

Conclusion

Buying property in Mallorca is an excellent investment and a chance to enjoy one of the most exclusive areas of the Mediterranean. However, it is crucial to work with professional advisors—both a real estate agent and a lawyer—to ensure a secure, transparent process with no surprises.