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Investing in real estate in Andorra

Investing in real estate in Andorra

In this article we cover what you need to take into account when buying a house or any other type of property in Andorra, the procedure you will have to follow and what kind of real estate you can buy. Whether you’re planning to live in Andorra or you’re looking to buy a second home as a real estate investment, this article is for you!


Table of Contents

    1. Buying a property in Andorra

      The procedure for acquiring a property in Andorra

      Costs involved in the acquisition of real estate in Andorra

      Where to invest in real estate?

      The price of living in Andorra

      The advantages of investing in Andorra


Buying a property in Andorra

If you are interested in acquiring a property in Andorra, you can do so either as a habitual residence or as an investment (it is not necessary to be a resident in the country). The only thing you need to take into account if you are not a resident is that you will need to request an authorisation for foreign investment in property.

The following entities require this authorisation:

  • Non-resident individuals
  • Andorran companies with foreign equity ownership or more than 50% of the voting rights
  • Branches or other types of permanent establishments of non-residents in Andorra

Additionally, in 2012 the Foreign Investment Act removed the limitation on the number of properties that can be acquired.

The procedure for acquiring a property in Andorra

The points below give details on how to invest in real estate in Andorra if you are a non-resident:

  • The first thing you need is the authorisation for foreign investment in real estate granted by the Government of Andorra. The process is fast and you should receive a response within 2 weeks (administrative silence is treated as a positive answer).
  • Along with this, you must attach a copy of your passport and a criminal record certificate from your country of origin.
  • To sign the title reservation agreement, you must pay a deposit to the real estate agency, which is usually 10% of the total price.
  • As in any other country, the purchase is made in a deed before a Notary Public. The notary fees are paid by the buyer.
  • At the same time, the seller must provide proof of an occupancy certificate guaranteeing the habitability of the property.
  • You will need an account with an Andorran bank, as payments will be made from this account.

We recommend that you also read our blog article: passive residence in Andorra, where we tell you how to acquire tax residence.

Costs involved in the acquisition of real estate in Andorra

Remember that since Andorra has lower taxation than other countries, it can offer attractive investment opportunities. In addition, the other expenses associated with the purchase and sale operation are also lower than in Spain or France.

When you purchase a property in Andorra, you will have to pay the ITP (transfer tax), which is 4% of the price of the property and is shared between the government and the Comú (town council) of the parish where the property is located. This tax is paid to the notary when executing the deed of sale.

Notary fees are paid by the buyer, and range from €600 to €1,200, corresponding to 0.1% of the value of the property.

Finally, you will have to add the fees for the services of the real estate agency, which range from 5% to 10% of the price of the property.

Where to invest in real estate?

The country boasts endless opportunities for both investing and living, depending on your personal interests. You can buy any type of property: from houses, flats and villas (both for permanent living and as second homes), to parking spaces, land and commercial premises.

If you are thinking of moving your residence and relocating with your whole family, you will find houses and flats in residential areas with good access to schools and institutes. You can live in the centre or, if you prefer to be closer to nature, there are many great options. You will also find fantastic alternatives at the foot of the ski slopes, the ideal place for a second home if you’re a fan of winter sports or you may even want to rent the property.

The price of living in Andorra

The average price per square metre in the first quarter of 2021 was €2,656.45. According to the report from the statistics department on real estate transactions in Q1 2021, this figure has increased by 13.6% compared to the same period in 2020. It is also worth noting that the cost of utilities (electricity and water) are also significantly lower compared to neighbouring countries.

The advantages of investing in Andorra

Low taxation and the economic openness of recent years has made investing and living in the principality very beneficial. On the one hand, the tax burden is lower than the European average (see our comparison with taxes in Spain and France here). And on the other, the agreements to prevent double taxation with other countries are a great benefit for companies, as the same concept is not taxed twice in both the country of origin and the country where the economic activity is undertaken.

If you have decided to purchase a property as an investment or to establish your place of residence in the principality, you won’t regret it. Quality of life is just one of Andorra’s strengths, along with its excellent standards of safety and health. In addition, Andorra is home to many public and private schools where you can enrol your children if you relocate here with your whole family. Finally, its privileged location in the heart of the Pyrenees will allow you to live among nature every day and enjoy the mountains in both winter and summer. And all this while staying close to Spain and France, at just a three-hour drive from Barcelona or Toulouse.

Do you want to invest in real estate in Andorra? At Advantia Assessors, we can assist you throughout the process and with the paperwork required to make it happen. Contact us!