Buyer's Guide
Buying off-plan in Spain safely: what you must check
Buying off-plan in Spain means paying for a home before it is built, in stages. By law the developer must secure every amount you pay with a bank guarantee or surety insurance, plus interest, in case construction does not start or finish on time. Before paying, check the building licence, the guarantee for each payment and the completion date with penalties.
How payments work when buying off-plan in Spain
The most common structure on the Costa del Sol has three or four payment points. Each developer adapts it, but the pattern is very similar.
| Stage | Typical payment | When |
|---|---|---|
| Reservation | €3,000-10,000 + VAT | When you choose the home |
| Private contract | 20-30% minus the reservation | Within about 2-6 weeks |
| Payments during construction | 0-20% in instalments | As building progresses |
| Completion | The balance, 50-70% | With the first-occupation licence |
The advantage is that you pay little at the start and have time to arrange your mortgage. You also usually get a wider choice of floors and orientations than with a finished home.
Protecting your money: guarantee or insurance
Spain's Building Act (LOE) requires the developer to guarantee the return of everything you pay on account, plus legal interest, from the moment it obtains the licence. It can do so with a joint and several bank guarantee or with surety insurance.
That guarantee protects you if construction does not start or is not finished by the agreed date. The money must also go into a special account kept separate from the developer's.
What to check before buying off-plan
- Building licence granted, not just applied for.
- Land registry extract for the plot: who owns it and whether there are charges.
- Completion date with a specific deadline and a penalty for delays.
- Building specification signed as an annex to the contract.
- Floor plans with usable and built areas of your home and its share of common areas.
- Expected community fees, especially if there is a spa, gym or concierge.
An independent lawyer checks all of this for around 1% of the price. On a €400,000 purchase it is cheap insurance.
Warning signs when buying off-plan
- You are asked to pay into a personal account or in cash.
- The building licence is «in progress» yet they ask for more than the reservation.
- You are not given the guarantee certificate for each payment.
- The contract has no specific completion date, only an «approximate» one.
If you spot any of these, stop and speak to a lawyer before paying anything else. A reputable developer has no problem showing you the licence and guarantees.
What if construction is delayed?
A delay of a few months is common and usually allowed for in the contract. If the agreed deadline is clearly exceeded, you can terminate the contract and get back what you paid with interest by calling on the guarantee.
- Check whether the contract sets a maximum extension.
- Keep all payment receipts and guarantee certificates.
- Ask the developer in writing for an updated date.
When the end comes, prepare well for handover and the snagging check. And if you want a development with a known date, look at Etherna Homes II in Estepona, due for completion in 2028.
Frequently asked questions
Is buying off-plan in Spain safe?
Yes, as long as every payment on account is covered by a bank guarantee or surety insurance in your name, as the law requires from the building licence.
How much do you pay to reserve an off-plan home?
On the Costa del Sol it is usually between 3,000 and 10,000 euros plus VAT, which is then deducted from the price.
Can I sell before construction is finished?
Some contracts let you assign your position to another buyer, sometimes for a fee to the developer. Check the assignment clause before signing.
What happens if the developer goes bankrupt?
If your payments are secured with a guarantee or insurance, the guarantor returns what you paid plus legal interest.
Official sources
- Building Act (LOE), first additional provision (BOE)
- Spanish Bar Council: buying a home off-plan
- Spanish Land Registry: nota simple
General information checked on the date shown; it does not replace advice from a lawyer or tax adviser for your case.
