Mortgages for Swiss Buyers of New-Build in Spain

The allure of Spain’s Costa del Sol, with its pristine new-build developments and vibrant lifestyle, continues to attract discerning buyers from across Europe. For Swiss nationals considering an investment in a modern Spanish property, understanding the mortgage landscape, taxation, and administrative procedures is paramount. This authoritative guide by Life in Costa, a trusted guide and directory for new-build homes, delves into the specifics for Swiss buyers looking to finance their dream new-build property in Andalusia.

Why New-Build Properties on the Costa del Sol?

New-build properties, whether off-plan or key-ready, offer distinct advantages. They typically feature contemporary designs, higher energy efficiency ratings, and modern amenities. Furthermore, developments we recommend often come with developer guarantees, providing peace of mind. For many Swiss buyers, a new-build represents a sound investment and a perfect holiday home or future relocation base in a sought-after region.

Swiss Buyers: Key Considerations for Spain

While Swiss citizens enjoy considerable freedom of movement within Europe, specific steps are required for property ownership and financial transactions in Spain.

The Essential NIE Number

Before any property purchase or mortgage application can proceed, every foreign buyer, including Swiss nationals, must obtain a Número de Identificación de Extranjero (NIE). This unique identification number is mandatory for all legal, financial, and administrative activities in Spain, such as buying property, opening a bank account, signing contracts, and paying taxes [10, 11, 15, 17, 19, 21, 24].

• Application Process: You can apply for an NIE at a Spanish Consulate or Embassy in Switzerland, or in person at a National Police Station (Oficina de Extranjería) in Spain [11, 17, 21, 22].
• Required Documents: Generally include a completed EX-15 application form, your valid passport (original and copy), proof of the reason for needing an NIE (e.g., property purchase intention), and proof of payment of the administrative fee (Modelo 790, Código 012) [11, 17, 19, 21, 22].

Non-Resident Status

For mortgage and tax purposes, Swiss nationals purchasing property in Spain are generally considered non-residents if they spend less than 183 days a year in the country [15, 23, 26]. This status impacts the loan-to-value (LTV) ratios offered by Spanish banks and the applicable tax rates.

Securing Your Mortgage for a Spanish New-Build

Spanish banks are accustomed to lending to non-residents, and securing a mortgage is a common practice for foreign buyers. However, the conditions differ from those for residents.

Loan-to-Value (LTV) Ratios for Non-Residents

Typically, Spanish banks offer non-residents a maximum loan-to-value (LTV) ratio of 60% to 70% of the property’s purchase price or valuation, whichever is lower [8, 10, 15, 18, 23]. This means Swiss buyers will generally need to provide a deposit of 30% to 40% of the property value, plus funds to cover additional purchase costs [8, 15, 18].

Types of Mortgages

Spanish banks offer various mortgage products:

• Fixed-Rate Mortgages: The interest rate remains constant throughout the loan term, providing predictability in repayments.
• Variable-Rate Mortgages: The interest rate fluctuates, typically linked to the Euribor plus a differential, meaning repayments can go up or down.
• Mixed-Rate Mortgages: A combination of fixed and variable rates, often starting with a fixed period before converting to a variable rate.

Interest rates for non-residents usually range between 3% and 5%, depending on the market and individual profile ²³.

Eligibility and Required Documentation

To assess your mortgage application, Spanish banks require comprehensive documentation, often more extensive for non-residents to verify overseas income and financial stability.

Key documents typically include:

1. Valid passport [10, 15].
2. NIE number [10, 15].
3. Proof of income: Last three payslips, employment contract, or proof of self-employment income ¹⁵.
4. Bank statements: Recent statements from your main bank accounts, usually covering the last 6-12 months ¹⁰.
5. Tax returns: Personal tax returns for the past two years ¹⁵.
6. Credit report: A credit history report from your country of residence.
7. Proof of existing assets and liabilities: Statements for other properties, investments, loans, and credit cards.
8. Property details: The reservation contract or purchase agreement for the new-build property.

The Mortgage Application Process

1. Initial Consultation: Discuss your financial situation and needs with a Spanish mortgage advisor or bank.
2. Document Submission: Provide all requested financial and personal documentation.
3. Pre-Approval: The bank assesses your eligibility and provides an initial offer based on your financial profile.
4. Property Valuation: The bank commissions an independent valuation (tasación) of the new-build property ¹⁵. This valuation determines the property’s market value for lending purposes.
5. Formal Offer: If the valuation is satisfactory, the bank issues a binding mortgage offer.
6. Signing at the Notary: The mortgage deed is signed in front of a Spanish public notary, simultaneously with the property’s public deed of sale (escritura pública) ²⁴.

Understanding the Costs of Your New-Build Property

Beyond the purchase price, buyers must budget for several taxes and fees. For new-build properties in Andalusia, these costs typically range from 13% to 15% of the purchase price [3, 12, 15, 18, 20, 24, 33, 40, 43].

Purchase Taxes for New-Builds in Andalusia

• Value Added Tax (IVA): New-build properties purchased directly from a developer are subject to IVA instead of Property Transfer Tax (ITP) [3, 13, 20, 29, 35, 43]. The general IVA rate for residential new-builds is 10% of the purchase price [3, 4, 12, 13, 20, 29, 32, 33, 35, 37, 39, 40, 41, 43]. For off-plan purchases, IVA is usually paid proportionally with each stage payment during the construction period, not just at completion ³⁹.
• Stamp Duty (Impuesto sobre Actos Jurídicos Documentados – AJD): This tax is payable in addition to IVA for new-build properties [3, 13, 20, 32, 35, 37, 39, 40, 43]. In Andalusia, the general AJD rate is 1.2% of the purchase price, applied to the public deed [3, 4, 13, 20, 27, 32, 33, 35, 37, 38, 39, 40, 43]. While reduced rates may apply in specific circumstances (e.g., for main residences below certain values), the general rate is most common for non-resident buyers [38, 50].

Other Purchase Costs

• Notary Fees: Fees for the public deed of sale and mortgage deed. These are government-regulated and typically range from €600 to €1,500, varying with property price [12, 15].
• Land Registry Fees: Costs to register your ownership and the mortgage at the Land Registry, generally between €400 and €1,000 [12, 15].
• Legal Fees: Highly recommended to engage an independent lawyer. Fees are typically 1% of the purchase price plus IVA, covering due diligence, contract review, and tax payment management ¹².
• Mortgage Arrangement Fees: Banks may charge a fee for opening the mortgage, typically 0.5% to 1% of the loan amount.
• Property Valuation Fee (Tasación): Required by the bank for mortgage purposes, usually €300-€600 ¹⁵.

Ongoing Property Ownership Costs and Non-Resident Taxes

Owning a new-build property in Spain involves annual costs and tax obligations for non-residents.

Annual Property Tax (IBI)

The Impuesto sobre Bienes Inmuebles (IBI) is an annual municipal property tax, similar to council tax, based on the property’s cadastral value ⁹. The rate varies by municipality but typically falls between 0.4% and 1.1% of the cadastral value [9, 41].

Non-Resident Income Tax (IRNR) – Modelo 210

Non-resident property owners must declare Non-Resident Income Tax (IRNR) via Modelo 210 to the Agencia Tributaria [5, 6, 7, 9, 16, 31, 34]. This applies even if the property is not rented out, as Spanish tax law imputes a notional rental income for personal use.

• For Imputed Income (Non-Rental): If the property is for personal use and not rented, tax is calculated on a percentage of its cadastral value (typically 1.1% or 2% depending on the cadastral value revision date) [6, 7, 9, 16]. For non-EU residents, including Swiss nationals, the tax rate on this imputed income is 24% [6, 16]. The Modelo 210 must be filed annually [7, 31].
• For Rental Income: If you rent out your new-build property, you must declare the actual rental income. For non-EU residents, the tax rate on gross rental income is 24%, and unlike EU/EEA residents, no expenses can be deducted [7, 14, 16, 31]. This tax must be filed quarterly [7, 31].

Wealth Tax (Impuesto sobre el Patrimonio) and Solidarity Tax

Andalusia historically offered a 100% bonus on Wealth Tax, effectively abolishing it for residents and non-residents alike, making the region attractive for high-net-worth individuals [28, 42, 46, 49]. However, the central Spanish government introduced the Temporary Solidarity Tax on Great Fortunes (Impuesto Temporal de Solidaridad de las Grandes Fortunas) to ensure wealth taxation at a national level [28, 42, 48, 49].

• For non-residents, the Solidarity Tax applies to net Spanish wealth exceeding €3,000,000, with a general exempt amount of €700,000 [28, 42, 49]. This means a liability typically arises for non-residents when their Spanish net wealth surpasses €3,700,000 [28, 49]. The rates are progressive, starting at 1.7% ⁴⁹.
• Non-residents are assessed only on their assets located in Spain ⁴².

Capital Gains Tax and 3% Retention on Sale

When a non-resident sells a property in Spain, any capital gain is subject to Capital Gains Tax. Currently, the rate for non-residents is 19% ⁷. Additionally, the buyer is legally required to withhold 3% of the sale price and pay it directly to the Spanish tax authorities on account of the seller’s potential Capital Gains Tax liability [7, 31]. The seller then declares the actual gain (or loss) and applies for a refund if the 3% withheld exceeds the final tax due, or pays the difference if it is less.

Relocation and Residency for Swiss Nationals

Swiss citizens do not require a visa to enter Spain for short stays (up to 90 days). For longer stays or if they intend to reside in Spain, they must register their presence, similar to EU citizens [26, 30, 36]. It is important to note that purchasing property in Spain does not automatically grant residency ³⁰. The previously available Golden Visa scheme, which offered residency for property investments of €500,000 or more, was repealed in April 2025 ³⁰. Swiss nationals wishing to relocate permanently would need to explore other residency options, such as non-lucrative visas, if they do not meet the criteria for other types of residency based on employment or self-employment.

Conclusion

Purchasing a new-build property on the Costa del Sol as a Swiss national offers an exciting opportunity for investment and lifestyle. While the process involves specific financial and legal considerations, particularly concerning mortgages and taxation, with careful planning and professional guidance, it can be a straightforward endeavor. Life in Costa is here to help you navigate the journey, connecting you with developments we recommend and providing essential information to ensure a seamless experience.