Due Diligence Checks Before You Buy in Spain

Buying a home on the Costa del Sol is a big step, often from another country. This guide shows you the legal checks that protect your money before you sign. You will learn what to verify, who does it, what it costs, and the risks of skipping it. It is written for foreign buyers of new-build property.

Quick summary

• Due diligence is the full legal check of a property before you buy.
• Spain runs on "buyer beware", so problems become yours after you sign.
• It usually takes 5 to 15 working days and is part of the lawyer's 1% fee.
• Always do it before you sign or pay, and always use an independent lawyer.

What is due diligence?

Due diligence is the full legal check of a property before you buy. Your independent lawyer carries it out. The goal is simple: confirm the home is legally clean, free of debt, properly built, and safe to buy.

Spanish property runs on a "buyer beware" rule. Once you complete, any hidden problem becomes yours, even if you did not know about it. Due diligence is how you find those problems first, while you can still walk away.

Why due diligence matters so much in Spain

In some countries, the system protects the buyer. Spain is different. Here the burden is on you and your lawyer to check everything before you sign. After completion, it is too late.

Foreign buyers face extra risk. You may not know the local problems that are common in Spain. You may be buying on a short trip, in love with the view, under pressure to decide. That is exactly when mistakes happen.

These are the problems due diligence is built to catch.

• Hidden debts. Unpaid taxes, community fees, and utility bills stay attached to the property, not the seller. Skip the check, and you inherit them.
• Illegal building work. Extra rooms, a pool, a terrace, or a garage built without a permit. These can bring fines or even a demolition order.
• Planning problems. A home built against zoning rules, which can limit how you use it or hurt resale.
• Wrong size or boundaries. If the real property does not match the official record, you can struggle to register or resell.

The full due diligence checklist

Here is what a proper legal check covers. Ask your lawyer to confirm each point in writing.

1. Land Registry check (nota simple). Confirms the true owner, and shows any mortgage, embargo, or charge. The nota simple is the official extract from the Land Registry (Registro de la Propiedad).
2. Cadastre check. Confirms the property's size and layout in the tax record (Catastro) matches reality.
3. Registry vs cadastre vs reality. The legal record, the tax record, and the actual home must all agree.
4. Urban planning and zoning. Confirms the property follows local building rules and has no sanction files against it.
5. Licences. Confirms a valid building licence, and the First Occupation Licence (Licencia de Primera Ocupación - the permit to live there legally and connect utilities).
6. Debts and bills. Checks for unpaid IBI (council tax), community fees, and utility bills.
7. Community of owners. Confirms the community (comunidad de propietarios) is well run, with no large debts or legal disputes, and checks the community rules.
8. Rental status. Confirms whether the home can be legally rented to tourists, if that is your plan.

Extra checks for new-build and off-plan

New-build and off-plan homes need a few more checks. These protect you against the risks unique to buying a property that is new or not yet finished.

• Developer's company. Confirm the developer exists and check its financial health in the Commercial Registry (Registro Mercantil).
• Land ownership. Confirm the developer actually owns the land or has the right to build on it.
• Bank guarantee. For off-plan, confirm a valid bank guarantee (aval bancario) covers every stage payment, under Law 57/1968 and Law 20/2015. Never pay a deposit without this.
• Detailed specification. Get the exact materials, layout, and fittings in writing, so the developer cannot quietly change them or charge extra later.
• Completion date and penalties. The contract should set a clear deadline and penalties for delays.
• 10-year structural warranty. Spanish law requires a 10-year guarantee on the building's structure.

A note on okupas (squatters). Many buyers worry about squatters. It is a fair concern, but the real risk on a gated, new-build estate is very low. These homes are occupied, alarmed, and watched by a community of owners. Spain's 2025 Anti-Squatter Law (Ley Antiokupas), in force since April 2025, also made eviction much faster. Police can remove illegal occupiers within 48 hours if caught early, and courts now use a fast-track process of around 15 days. Part of buying well is making sure your new home is properly secured from the first day.

When should you do it?

Before you sign anything binding. Before you pay any meaningful money. This is the most important timing rule in Spanish property.

The private purchase contract (contrato de arras - the binding deposit contract) is legally enforceable. If you sign it and then pull out, even for a good reason, you can lose your deposit. So the checks must come first.

If a seller or agent pushes you to sign fast, your lawyer can add a suspensive clause (condición suspensiva - a get-out clause). This makes the deal conditional on a clean due diligence result. If a serious problem turns up, you walk away and keep your money.

Warning: Pressure to "sign today or lose it" is a classic tactic. A genuine, good property will still be there after a proper check. Never let urgency push you into signing before due diligence is done.

How long it takes and what it costs

Due diligence usually takes 5 to 15 working days. The exact time depends on the property and how fast the town hall responds.

The cost is part of your lawyer's fee, which is normally around 1% of the purchase price plus VAT (IVA at 21%). Let us use a real example with a 500.000 euros new-build.

Worked example: 500.000 euros new-build

• 5.000 euros - lawyer fee, including due diligence (1%)
• 1.050 euros - VAT (21%)
• Total: 6.050 euros

A nota simple itself costs only a few euros. The real value is in the lawyer's trained eye, reading the registry, the cadastre, the licences, and the community accounts together. Against a 500.000 euros purchase, this is small money for total peace of mind.

What happens if you skip it

These risks are not rare horror stories. They happen often, especially to buyers who move too fast. Skipping due diligence can mean:

• Paying fines or facing demolition for unlicensed building work.
• Being unable to get a mortgage, insurance, or correct registration.
• Inheriting someone else's unpaid debts.
• Legal disputes with neighbours or the town hall.
• Trouble reselling the home because of a legal defect.

Any one of these can cost far more than the lawyer's fee, and some cannot be fixed at all.

Buying remotely: doing checks from abroad

You do not need to be in Spain for due diligence. Most British, Irish, Dutch, Scandinavian, German, Polish, and Czech buyers handle it from home.

Your independent lawyer pulls the registry and cadastre records, contacts the town hall, the tax office, and the community, and reports back to you in your language. If you cannot travel to complete, you sign a Power of Attorney (poder notarial - a legal document that lets your lawyer act for you) so your lawyer can sign the deed for you. The whole check can run while you stay in your own country.

This is where having the right team is everything. At Spain Developments, we work only with independent Spanish lawyers, never the developer's lawyer. That matters because the developer's lawyer has a conflict of interest: they are paid by the seller. An independent lawyer has the duty and the reason to find problems before they become yours. As a developer-paid buyer's agent, we coordinate the full due diligence so nothing is missed.

Bonus tip: Ask your lawyer for a written due diligence report at the end. A clear summary of what was checked, what was found, and what was resolved. A good lawyer gives this as standard. It is also useful proof for the future, if you ever sell.

Before you sign: due diligence checklist

• Nota simple pulled fresh from the Land Registry.
• Cadastre, registry, and reality all match.
• Building licence and First Occupation Licence confirmed.
• No unpaid IBI, community fees, or utility debts.
• For off-plan: valid bank guarantee covers every stage payment.
• Written due diligence report received from your lawyer.

The bottom line

Due diligence is the legal check that keeps your money safe in Spain. It confirms the true owner, finds hidden debts, checks the licences, and makes sure the home is legally clean. In a "buyer beware" system, it is your main protection.

Always complete due diligence before you sign or pay, and always use an independent lawyer, not the developer's. If you are buying a new-build on the Costa del Sol, Spain Developments can arrange a full, independent legal check, handled in your language from start to finish.