Are you thinking about investing in real estate in Andorra as a foreigner? This guide explains the legal process for foreign real estate investment step by step. From initial requirements to taxes and the notarial signing, everything you need to know to buy property in Andorra is here.
Who needs authorization to invest in Real Estate in Andorra?
Foreign investment authorization is required for:
- Non-resident foreign individuals.
- Foreign residents with less than 3 years of residency in the country.
Procedure for requesting authorization
Required documentation
To begin the process, you must submit an application to the Government of Andorra including:
- Personal information.
- Investment motivations.
- Details of the property you wish to acquire.
Documents to attach
- Criminal record certificate from your country of origin (valid and legalized/apostilled).
- Copy of a valid passport or identity document.
Applicable fees and taxes
- Administrative fee: €300
- Tax on foreign real estate investment:
- 3% of the value for the first residence.
- May vary for second homes or properties with non-residential purposes.
Opening a bank account in Andorra
Why is it necessary?
It is mandatory to have an account in an Andorran bank to channel the funds for the real estate transaction.
Requirements for account opening
- Identity document.
- Proof of legal origin of funds (according to anti-money laundering regulations).
- Additional documentation requested by the bank.
Practical recommendation: Deposit at least 50% of the property’s value before the signing (not a legal requirement, but commonly practiced).
Signing the purchase before a notary
Pre-conditions
- The seller must present a valid Certificate of Habitability.
- In case of financing, the mortgage must be formalized with an Andorran financial institution.
Notarial costs
- Notary fees: between €600 and €1,200
- Notarial tariff: 0.1% of the purchase price.
Taxes associated with the real estate purchase
- IGI (General Indirect Tax): 4.5% of the property value.
- Tax on foreign real estate investment:
- 3% of the property’s value (for first residence).
- This tax is independent of IGI, ITP, and other municipal levies.
Additional considerations for foreign investors
Tax residency in Andorra
To obtain tax residency in Andorra, the requirements are:
- Residing in the country for at least 183 days per year.
- Meeting the requirements according to the type of residency:
- Passive
- Active
- Digital
- Other valid modalities
Possible legislative changes (2025)
Proposals under discussion may modify investment conditions:
- Restricted zones for purchases by non-residents.
- Limits on the acquisition of second homes or speculative properties.
- New fees or requirements for certain foreign investor profiles.
Investing in real estate in Andorra can be an excellent opportunity, but it requires a solid understanding of the procedures and associated costs. We recommend working with a legal or real estate advisor specialized in foreign investment in Andorra to ensure a smooth, legal process without surprises.
