Best Areas on the Costa del Sol for German Buyers
The best areas on the Costa del Sol for German buyers range from Marbella and Estepona in the west to the strongly German-flavoured Nerja, Torrox and Axarquia in the east. As EU citizens, Germans buy freely with no visa, pay 10% IVA plus 1.2% AJD on a new build, and are protected from double taxation by the 2011 Germany-Spain treaty.
Choosing the best areas on the Costa del Sol for German buyers is partly about lifestyle and partly about numbers. As German citizens you enjoy full EU freedom of movement, so no visa or non-lucrative residence permit is required to own or live in Spain; you simply obtain an NIE and, if you stay long term, register as an EU citizen. What matters more is picking a location that fits your budget, your travel needs and the sort of community you want around you, then understanding the taxes and financing that apply to a foreign buyer. This guide walks through the strongest areas for German purchasers and the money and legal facts behind a new-build purchase.
Why the Costa del Sol suits German buyers
The Malaga coast has a long-established German presence. Germans are one of the largest foreign communities in Malaga province, with around 11,369 registered residents in the latest municipal register (padron) data. 11 The province as a whole reached 1,798,265 inhabitants on 1 July 2025, and foreign-born residents make up 24.3% of the population, well above the national average. 10 That density of international residents means German-speaking lawyers, doctors, estate agents and social clubs are easy to find, particularly in the eastern coastal towns.
Connectivity is the other draw. Malaga-Costa del Sol airport runs frequent direct flights to Germany, with Lufthansa serving Frankfurt, Munich, Dusseldorf, Stuttgart, Cologne/Bonn, Hamburg, Berlin and Hanover, among other links. 13 The Frankfurt route alone runs a very high weekly frequency, and flight time is roughly three hours. 12 For a weekend commute between a home in Bavaria and a place near the beach, that is hard to beat.
Best areas for German buyers
The coast splits naturally into a western, more international-luxury stretch and an eastern, more traditionally German and Nordic stretch. Both have strong new-build pipelines.
Marbella and Estepona (the west)
Marbella remains the flagship for buyers who want established prestige, golf, marinas and a deep resale market. Estepona, just to the west, has reinvented itself with a walkable old town, a long promenade and a wave of new-build apartment and townhouse developments at prices below central Marbella. This stretch tends to attract German buyers looking for a primary residence or a high-quality second home rather than a bargain, and it offers the widest choice of branded, energy-efficient new builds.
Fuengirola, Mijas and Benalmadena (the centre)
The central coast is the practical middle ground: closer to the airport, well served by the coastal train line, and cheaper per square metre than Marbella. Mijas Costa and Benalmadena combine sea-view new builds with a settled year-round expatriate life, while Fuengirola offers a denser, more urban feel with everything walkable. This zone works well for German buyers who want rental potential alongside personal use, given the strong tourist demand.
Nerja, Torrox and the Axarquia (the east)
East of Malaga city, the Axarquia is the most historically German-leaning part of the coast. Torrox Costa in particular has marketed itself for decades on its mild microclimate and has a notably large German community, while nearby Nerja offers a more upmarket resort feel with its famous balcony-of-Europe seafront. Prices here are generally gentler than in the west, and the pace is quieter. If you want German neighbours, German bakeries and German-speaking services close at hand, this is the natural first place to look.
What German buyers pay in purchase tax
The single biggest split is new build versus resale. A new build (bought from the developer, first transmission) carries IVA (VAT) plus stamp duty (AJD); a resale carries transfer tax (ITP) instead. The table shows the Andalucia rates.
| Purchase type | Tax | Rate in Andalucia |
|---|---|---|
| New build (from developer) | IVA (VAT) + AJD (stamp duty) | 10% + 1.2% = 11.2% 3 |
| Resale (second-hand) | ITP (transfer tax) | 7% standard 1 |
| Resale up to 500,000 euro, certain conditions | ITP reduced rate | 2% 2 |
Andalucia moved to a flat 7% ITP under Law 5/2021, and it remains the standard transfer-tax rate for resale homes. 1 From 2026, following the regional budget Law 8/2025 published in the BOJA, the reduced 2% ITP rate is reserved for properties whose total value does not exceed 500,000 euro, and the qualifying resale term was shortened to two years; you should confirm eligibility with a lawyer because the conditions are specific. 2 On a new build, the combined charge is 10% IVA and 1.2% AJD, a total of 11.2%. 3 On top of purchase tax, budget for notary, land registry and legal fees, so most advisers suggest allowing roughly 12% to 14% over the price in total. See our separate guide to new-build purchase costs on the Costa del Sol for the full breakdown.
Annual and exit taxes for non-residents
If you keep your German tax residence and use the property as a second home, you file Spanish Non-Resident Income Tax (IRNR) each year on Modelo 210, the official form of the Agencia Tributaria. 4 Even with no rental income, Spain applies an imputed (deemed) income based on a percentage of the cadastral value, generally 1.1% of that value where it has been revised in the last ten years, or 2% otherwise. As EU residents, Germans are taxed at 19% on that base rather than the 24% that applies to non-EU owners. 5 If you rent the property out, you declare the actual rent, again at 19% for EU residents, with deductible expenses available. Our dedicated Modelo 210 guide covers the filing calendar in detail.
Separately, every owner pays IBI, the annual municipal property tax billed by the town hall on the cadastral value; the rate is set locally and varies between municipalities, so check the specific rate for your town. When you eventually sell, if you are still non-resident the buyer is legally required to withhold 3% of the sale price and pay it to the tax office on Modelo 211, as an advance against your capital gains tax; you then file your own IRNR return within the following months to settle the final figure and reclaim any excess. 6 A municipal plusvalia tax on the increase in land value may also apply on sale. Keep every invoice, because purchase costs and improvements reduce the taxable gain.
Financing as a non-resident
Spanish banks lend to foreigners, but on tighter terms than to residents. As an EU buyer you can typically borrow up to around 60% to 70% loan-to-value on a second home, meaning you need at least 30% to 40% of the price in cash plus all the purchase costs on top. 7 Rates in 2026 are commonly offered as fixed or mixed products (a fixed period followed by a Euribor-linked variable stage). 7 Because your German income and assets will be assessed, arranging a mortgage agreement in principle before you commit to a reservation is sensible; our mortgages-for-non-residents guide explains the documentation Spanish lenders ask for.
The Germany-Spain double taxation treaty
The current double taxation agreement between Spain and Germany was signed in Madrid on 3 February 2011 and follows the OECD model. 8 For real estate, it assigns the taxing right over Spanish property income and gains to Spain, and Germany then relieves double taxation on the German side, so the same income is not effectively taxed twice. 9 In practice this means you pay the Spanish IRNR and IBI described above, declare the Spanish source income in Germany, and rely on the treaty mechanism to avoid a double charge. Because the interaction between German and Spanish reporting can be intricate, particularly if you rent the home out, most German buyers use an adviser familiar with both systems. Nothing in the treaty changes your right as an EU citizen to buy freely without a visa.
Living there: schooling, healthcare and daily life
For families relocating, the coast has international and German-oriented schooling options, and the wider Malaga area has long served the German community; confirm current places and curricula directly with each school. Healthcare is a mix of the Spanish public system (accessible once you register and contribute or via EU coordination rules) and a large private sector with German-speaking clinics, especially around Marbella and the Axarquia. Add the year-round mild climate, the direct flights home and the established German social fabric, and the Costa del Sol offers one of the smoothest soft landings in Spain for a German buyer. For the paperwork side, read our NIE and EU-registration guide alongside this one.
Frequently asked questions
Do German citizens need a visa to buy on the Costa del Sol?
No. As EU citizens, Germans enjoy freedom of movement and can buy and own property in Spain without any visa or non-lucrative residence permit. You only need an NIE (foreigner identification number) to complete the purchase, and if you settle long term you register as an EU citizen. This is a legal EU right rather than a discretionary permit.
What tax does a German buyer pay on a new-build home in Andalucia?
Which Costa del Sol areas have the biggest German communities?
The eastern coast, especially Torrox Costa and Nerja in the Axarquia, has the most traditionally German character, with German-speaking services and a settled community. Marbella and Estepona in the west attract German buyers seeking prestige new builds, while the central towns of Fuengirola, Mijas and Benalmadena offer good value and airport proximity.
Do I pay tax in Spain every year even if I do not rent the property out?
Will I be taxed twice, in Spain and in Germany?
Not effectively. The 2011 Germany-Spain double taxation treaty assigns taxing rights over Spanish property income and gains to Spain, and Germany then relieves the double charge on its side. 89 You still report Spanish-source income in Germany, but the treaty prevents the same income being fully taxed in both countries. An adviser familiar with both systems is recommended, especially for rental income.
How much can a German buyer borrow from a Spanish bank?
As an EU non-resident you can typically obtain a mortgage of around 60% to 70% loan-to-value on a second home, so you need 30% to 40% of the price in cash plus purchase costs. 7 In 2026, banks commonly offer fixed or mixed rates, the latter starting fixed then moving to a Euribor-linked variable rate. Your German income and assets are assessed in the application.
