Buying Property in Valencia and the Costa Blanca: The 2026 Transfer Tax Cut and Buyer Guide

Buying Property in Valencia and Costa Blanca: 2026 Transfer Tax Cut and Buyer Guide

The Valencian Community (Comunitat Valenciana) — home to Valencia city and the Costa Blanca coast around Alicante — has quietly become one of Spain's most attractive regions for foreign buyers. In 2026 the region cut its standard Impuesto sobre Transmisiones Patrimoniales (ITP) on resale homes from 10% to 9%, narrowing the gap with Madrid and Andalucía. Combined with strong rental demand, direct flights from northern Europe and the UK, and a still-reasonable cost per square metre versus the Balearics or Málaga, the region deserves a careful look.

This guide walks you through the buying process, the tax reform, who pays what, and the pitfalls foreign buyers fall into around Denia, Jávea, Moraira, Altea, Benidorm, Torrevieja, Orihuela Costa and the city of Valencia itself.

Spanish tax and property rules change frequently and vary by autonomous community. Always confirm current figures with the Agencia Tributaria Valenciana (ATV), the Agencia Tributaria (AEAT), and an independent Spanish abogado — not the seller's or developer's lawyer — before signing anything.

Why Valencia and the Costa Blanca in 2026

The Costa Blanca stretches roughly from Denia in the north to Pilar de la Horadada in the south, all within the province of Alicante. Valencia city sits about two hours north by AVE high-speed rail. What's driving foreign interest:

• Climate and connectivity. Alicante-Elche and Valencia airports both have year-round flights to most of Europe.
• Relative affordability. Prices per square metre remain well below Marbella, Ibiza, and central Barcelona.
• The ITP reduction. Effective in 2026, the general ITP rate for resale homes in the Comunitat Valenciana dropped from 10% to 9%, with additional reduced rates for large families, young buyers under 35, and people with disabilities buying a habitual residence. Confirm your specific rate with the ATV.
• Rental demand. Both long-term (Valencia's tech and student market) and short-term (Costa Blanca tourism) rental markets are deep — though short-term licences are increasingly restricted at the municipal level.

The Costa Blanca buying process, step by step

1. Get your NIE and open a Spanish bank account

Every foreign buyer needs an NIE (Número de Identidad de Extranjero). You can apply at a Spanish consulate in your home country or in person in Spain. Your abogado can also do it under a power of attorney (poder notarial) if you're buying remotely.

You'll also want a Spanish non-resident bank account to pay the deposit, the balance, taxes, and future utilities.

2. Engage an independent lawyer — before you sign anything

This is the single most important step. Use a colegiado (bar-registered) abogado who works only for you, ideally one who reads and speaks your language fluently but is licensed in Spain. Estate agents and developers will happily suggest "their" lawyer — decline politely and find your own.

Your lawyer will:

• Pull the nota simple from the Registro de la Propiedad to verify ownership, boundaries, mortgages, and embargos.
• Check the Certificado Catastral and confirm the property's cadastral reference matches the registry description.
• Verify the Cédula de Habitabilidad (or Licencia de Ocupación in some municipalities) and the Certificado Energético.
• Confirm the community of owners (comunidad de propietarios) has no outstanding debts against the unit.
• On new builds, check the developer's Licencia de Primera Ocupación and the bank guarantee for any deposits.

3. Reservation contract and deposit

Once you've chosen a property, expect to sign a contrato de reserva with a small reservation fee (often €3,000–€6,000) to take it off the market for a couple of weeks while due diligence is completed.

4. Arras contract (private purchase contract)

Next comes the contrato de arras, typically arras penitenciales under Article 1454 of the Código Civil. You usually pay 10% of the price. If you back out, you lose it; if the seller backs out, they owe you double. Do not sign this without your lawyer reviewing it.

5. Signing at the notary (escritura pública)

Completion happens before a notario, who is a neutral public official — not your advocate. You (or your attorney under power of attorney) sign the escritura pública de compraventa, pay the balance (typically by bank cheque), and receive the keys. The notary sends the deed to the Registro de la Propiedad, where full registration usually takes a few weeks.

Costs and taxes: who pays what

Budget roughly 11–14% on top of the purchase price for a resale home in the Comunitat Valenciana in 2026. Verify each line with the ATV and your lawyer.

Buyer pays:

• ITP (resale homes): General rate 9% in the Comunitat Valenciana from 2026 (down from 10%). Reduced rates may apply to habitual residence for buyers under 35, large families, or buyers with disabilities. Confirm your bracket with the ATV.
• IVA + AJD (new-build homes from a developer): 10% IVA plus Actos Jurídicos Documentados (AJD) at the current Valencian rate (historically around 1.5% — confirm the 2026 figure).
• Notary fees: Set by tariff; typically €600–€1,200.
• Land registry: Usually €400–€800.
• Legal fees: Commonly 1% + IVA of the purchase price, with a minimum.
• Gestoría / bank charges: A few hundred euros if you're taking a mortgage.

Seller pays:

• Plusvalía municipal (municipal capital gains on the land value increase) — though this is negotiable in the contract.
• Estate agent commission (typically 3–5% + IVA).
• Their own capital gains tax (IRPF or IRNR) on the profit, with a 3% retention withheld at closing for non-resident sellers.

Buying off-plan on the Costa Blanca

New developments are common from Finestrat down through Orihuela Costa. Extra protections apply:

• Deposits must be held in a special escrow account and backed by a bank guarantee (aval bancario) under Ley 38/1999 and its updates. Never wire money to a developer without this in place.
• Verify the licencia de obra and, at delivery, the Licencia de Primera Ocupación.
• Understand the payment schedule — typically 30–40% during construction, balance at notary.

Foreign buyer specifics for Alicante and Valencia

• Alicante province property foreign buyers consistently top Spain's foreign-buyer statistics, especially British, Dutch, Belgian, German, and increasingly French and American purchasers. Local agencies, notaries and lawyers are used to cross-border transactions.
• Golden Visa: gone. The residency-by-real-estate investment programme was ended in April 2025. Do not buy in Spain expecting a Golden Visa — it is no longer available. Other visa routes (non-lucrative visa, digital nomad visa) remain, but property purchase alone no longer confers residency rights.
• Non-resident taxes. Even if you don't rent the property out, non-resident owners file an annual imputed-income return (Modelo 210). Confirm the current rate with the AEAT.
• Short-term rental licences. Both Valencia city and many Costa Blanca municipalities have tightened or paused new tourist-rental (Vivienda de Uso Turístico) registrations. Never assume you can Airbnb a property — verify the specific municipality's rules before buying with rental income in mind.

Common mistakes foreign buyers make

• Using the seller's or developer's recommended lawyer. Conflict of interest is real.
• Skipping a structural survey. Not legally required, but essential on older village houses and 1970s coastal apartments.
• Ignoring the community of owners' minutes. Special assessments for façades, lifts or pools can run into thousands.
• Underdeclaring the price at the escritura. Illegal, and the ATV can reassess using its valor de referencia and pursue back tax plus penalties.
• Assuming rural land is buildable. Ask for a cédula urbanística from the town hall.

Short FAQ

Is the 9% ITP automatic? It's the general 2026 rate for resale homes in the Comunitat Valenciana. Reduced rates require you to meet specific conditions and file correctly.

Can I buy remotely? Yes, via a Spanish power of attorney signed at a notary or Spanish consulate.

Do I need to be a resident to buy? No. There is no residency requirement to own Spanish property.

How long does closing take? From arras to notary, typically 4–8 weeks for a resale; longer for off-plan.

Do the paperwork properly, use your own lawyer, and Valencia and the Costa Blanca offer one of the more welcoming entry points into Spanish real estate in 2026.