Property Investment in Spain 2026: Taxes, Tourist Licences and Realistic Yields

Spain is the largest holiday-home market in Europe by transaction volume, and for good reason: a long season, mature rental platforms and deep liquidity when you want to sell. It is also a market where the difference between a 6% and a 3% net yield is decided by two things most buyers underestimate — regional tax and the tourist licence.

Acquisition costs: budget 12–14% on a resale

Transfer tax (ITP) on resale property is set by the autonomous community: Madrid 6%, Andalusia 7%, Balearic Islands 8–13% (progressive), Catalonia 10%, Valencia 10%. New-build carries 10% VAT plus 1.5% stamp duty (AJD). Add roughly 1% notary and registry and, if the buyer pays the agent (uncommon but not unheard of), 3% plus VAT. On a €300,000 resale in Valencia, plan for about €338,000 all-in.

The tourist licence decides whether the STR case exists

Short-term letting requires a regional tourist registration — VT in the Valencia region, HUT in Catalonia, VFT in Andalusia — and, since 2025, a national registry number (NRUA) that platforms must display. Many cities have frozen new licences in saturated zones: Barcelona plans to withdraw all tourist licences by 2028, Málaga and Sevilla have introduced zoning caps, and Madrid restricts entire-home STR in the central district. Buy a property with a valid, transferable licence, or buy in a municipality that still issues them and confirm in writing before signing the arras (deposit contract).

Community of owners can veto Airbnb

Since 2025, a Spanish community of owners (comunidad de propietarios) can prohibit tourist letting in the building with a three-fifths majority. Ask for the community minutes (actas) from the last two years and check the statutes before making an offer on an apartment.

Taxes on rental income

• EU/EEA non-residents: 19% on net rental income (expenses deductible, pro-rated for let days) via Modelo 210

• Non-EU non-residents (including UK): 24% on gross rental income, no deductions

• Residents: rental income is added to general income at progressive rates (19–47%); a 60% reduction applies to long-term residential lets only, not to STR

• Imputed income tax on the days the property is not let (1.1–2% of cadastral value × 19% or 24%)

• IBI (municipal property tax) 0.4–1.1% of cadastral value per year, plus refuse charges

Wealth tax and the solidarity tax

Non-residents are liable for Spanish wealth tax on Spanish assets above €700,000 (Madrid and Andalusia apply a 100% rebate, but the national solidarity tax then applies above €3 million). For most single-property investors this is not a factor, but it changes the maths for portfolio buyers.

Realistic yields by region (2026)

• Valencia city & Costa Blanca: 4.5–5.5% net on licensed two-bedroom apartments

• Costa del Sol (Málaga, Marbella, Estepona): 3.5–4.5% net; strong capital growth, high entry prices

• Canary Islands: 4–5% net, near year-round occupancy but a moratorium on new tourist units in several municipalities

• Balearics: 2.5–3.5% net; the tightest licensing and highest transfer tax in Spain

• Madrid & Barcelona: 3–4% net on long-term letting; STR case largely closed for new buyers

Selling: the 3% retention and capital gains

When a non-resident sells, the buyer withholds 3% of the price and pays it to the tax office as an advance on capital gains tax (19% for EU residents, 24% otherwise). Plusvalía municipal, a local tax on the increase in land value, is also due. Keep every invoice from purchase and renovation — they reduce the taxable gain.

Checklist before you make an offer

1. Confirm the regional tourist licence number and that it transfers with the property

2. Read the community statutes and last two years of minutes for STR prohibitions

3. Get the nota simple from the land registry to check for debts and the legal description

4. Apply for your NIE (foreigner tax number) — you cannot buy without it

5. Model net yield with the regional ITP rate, not a national average

Terrivio applies the correct regional transfer tax, the 19%/24% non-resident regime, IBI and the STR regulatory status automatically for any Idealista, Fotocasa or Habitaclia listing — so you see the after-tax net yield for that specific city before you book a viewing.