Due Diligence Checklist: What Your Lawyer Must Check Before You Buy in Spain

Key takeaway: Due diligence is the single most important step when buying property in Spain. It must be carried out before you sign any contract or pay any deposit. Once you have signed an arras agreement and paid a deposit, withdrawing from the purchase can mean forfeiting that deposit.

What Is Due Diligence in a Spanish Property Purchase?

Due diligence is the legal investigation your lawyer carries out on a property before you commit to buying it. It uncovers problems that are not visible to the naked eye — debts attached to the property, planning irregularities, unlicensed extensions, outstanding mortgages, or disputes that could affect your ownership or ability to resell.

The Due Diligence Checklist

1. Land Registry (Registro de la Propiedad)

Confirm the seller is the registered owner of the property
Check for any outstanding mortgages, charges or embargos (seizures) registered against the property
Verify the registered surface area and description match what you are being sold
Confirm there are no easements, rights of way or usufructs affecting the property

2. Planning and Urban Status (Town Hall)

Confirm the property is classified as residential urban land (suelo urbano)
Check that any extensions or alterations have the required licencia de obras
Verify the property has a licencia de primera ocupación (first occupation licence) — without this you cannot legally connect to utilities or obtain a tourist licence
For rural properties: check that any buildings on rural land are not subject to demolition orders

3. Outstanding Debts

Outstanding IBI (annual property tax) — debts pass to the new owner automatically
Community of owners fees — outstanding fees are inherited by the buyer
Utility debts (electricity, water, gas)
Check the last 3 years' IBI receipts
Request a certificate from the community of owners confirming no outstanding fees

4. Catastro

Verify the catastral reference number and the description at the Catastro
Check that the catastral surface area matches the Land Registry and what you are buying
Discrepancies between the Catastro, Land Registry and physical reality are common and can complicate ownership registration

5. Energy Certificate (Certificado de Eficiencia Energética)

Sellers are legally required to provide an energy certificate
The certificate must be in date and must be registered with the regional government

6. Community of Owners (Comunidad de Propietarios)

Review the community statutes and any pending major works
Check whether any extraordinary levies have been agreed or are pending
Confirm the community has public liability insurance

7. The Seller

Confirm the seller's identity matches the Land Registry
If selling through an agent or via power of attorney, verify the agent's authority
Check for any insolvency proceedings or embargos against the seller personally

Why the Arras Agreement Matters

In Spain, it is common to sign an arras agreement (contrato de arras penitenciales) and pay a deposit (typically 10%) before the notary deed is signed. Under this contract, if the buyer withdraws, they lose their deposit. If the seller withdraws, they must return double the deposit. Due diligence must be fully completed before the arras are signed — not after.