FAQ Property on Mallorca

The purchase of property on Mallorca is well structured for international buyers, but involves many documents and taxes. Crucial are a clean review before signing a contract, the correct tax classification of the purchase, and clarifying whether the property is to be used privately, rented long-term, or offered for tourist rental.

Can foreigners buy property on Mallorca?

Yes. Foreigners can acquire property in Spain and therefore also on Mallorca. However, the purchase does not replace a residence or visa procedure. Anyone wishing to live permanently in Spain must check residence and tax residency separately.

How does the purchase process work?

Property selection and price negotiation.
Reservation or Arras contract, preferably with clear conditions.
Due diligence by independent advisors: register, cadastre, building permits, usability, comunidad, taxes and encumbrances.
Organize NIE, financing, payment method and proof of funds.
Notary appointment with escritura, purchase price payment and handover of possession.
Declare taxes, monitor land registry entry and transfer utilities.

How high are the ancillary purchase costs?

As a rough planning figure, buyers should expect approximately 10 to 14% in addition to the purchase price, depending on the type of property and financing. For new builds, luxury properties, financing or complex structures, it can be more.

Cost item	Typical application	Note
ITP	Second-hand properties	In the Balearic Islands generally progressive from 8% to 13%.
IVA	First sale from developer	For residential properties generally 10%.
AJD	Notarial deeds, especially new builds	In the Balearic Islands generally 1.5%, check special cases.
Notary and land registry	All purchases	Depends on purchase price, deed and register scope.
Lawyer, gestoría, translation	Recommended for international buyers	Clarify fee and scope of services in writing.

Do I need an NIE?

Yes, almost always. The Número de Identidad de Extranjero is required for notary, tax returns, land registry, bank, utilities and many administrative acts.

Do I need a Spanish bank account?

Legally, not every purchase is necessarily tied to a Spanish bank account. In practice, however, it is very useful: for purchase price payment, direct debits, IBI, comunidad, insurance and ongoing tax payments.

What does a lawyer check?

Owner, powers of attorney and authority to represent.
Nota Simple, mortgages, seizures, easements and encumbrances.
Cadastral data, land registry data and discrepancies in area or buildings.
Building permits, cédula, energy certificate and urban planning situation.
Comunidad: arrears, special assessments, bylaws and usage restrictions.
Tax classification: ITP or IVA/AJD, reference value and ancillary costs.

What is a Nota Simple?

The Nota Simple is an informative extract from the Registro de la Propiedad. It shows the registered property, the registered owner and the currently registered rights and encumbrances, such as mortgages, usufruct, easements or restrictions.

Can I rent out the property?

Long-term residential rental is generally possible, but is subject to rental law, tax obligations and the rules of the homeowners' association. Tourist rental is significantly more strictly regulated and requires a thorough check of zoning, property type, cédula, registration and comunidad.

What ongoing costs are incurred?

IBI and municipal fees.
Comunidad, reserves and special assessments.
Insurance, utilities, pool, garden and maintenance.
IRNR for non-residents, even for own use or vacancy.
For higher assets, possible wealth tax.

What do I need to consider when selling?

When selling, the main factors are taxation of the capital gain, Plusvalía Municipal, handling of mortgages and preparation of clean sales documents. For non-resident sellers, the buyer must generally withhold 3% of the purchase price and pay it to the tax authority.