Buying a property in Andorra continues to be a very attractive option for foreign investors, but the current context has changed. In 2026, new requirements in the field of passive residency in Andorra are introduced, affecting both the process and the cost of the investment. This makes it even more important to clearly understand how it works before taking the step.
This is not a radical change, but rather a series of modifications that have been progressively implemented until reaching the Omnibus Law 2, aimed at continuity and consolidation of measures for sustainable growth. Therefore, this year, foreign real estate investment in Andorra requires more planning and a thorough understanding of the conditions.
Table of contents:
- How the purchase process works for a foreigner
New financial requirements and impact on purchase costs
What has changed in the taxation of real estate investments and how it affects you
Who has to pay this tax?
What costs you need to take into account
The timeline of the process
Location is also an important decision
Do you want to buy a property in Andorra?
How the purchase process works for a foreigner
The purchase process in Andorra for a foreign investor includes a mandatory preliminary step: foreign investment authorization.
This is a standard procedure that forms part of obtaining passive residency in Andorra. If managed correctly, it does not present any difficulty, has a cost of €300 (this cost is only for this document and is separate from the financial requirements) and can take up to 2 months. However, it does mean that the property purchase must be planned further in advance, especially if it is linked to a residency project in Andorra.
Once the authorization is obtained, the process follows the usual steps: property reservation, deposit contract and signing before a notary.
New financial requirements and impact on purchase costs
Buying a property continues to be one of the most common ways to obtain passive residency in Andorra.
With the new Omnibus Law 2, the minimum required foreign real estate investment is €800,000 for a single property. In addition, it must also be taken into account that for passive residency, a deposit of €50,000 must be made to the AFA (Andorran Financial Authority), which increases by €12,000 for each dependent.
You can consult the modification of the requirements for direct foreign investment and the self-employed residence permit in this article.
What has changed in the taxation of real estate investments and how it affects you
One of the most important changes when buying a property in Andorra is taxation.
Currently, if you purchase a property as a foreigner, you will pay:
- 6% tax on the first property.
- This tax increases to 10% for a second property.
This is a requirement that must also be considered when planning this type of investment.
In addition to this change in percentages, the regulation governing this tax has also been modified, with the aim of making it clearer and adapting it to the new market context.
On one hand, it is now clearer who must pay it in each transaction, which avoids doubts and simplifies the process. On the other hand, in cases where the purchase is exempt (very specific situations), it is no longer necessary to advance payment before obtaining authorization. This exemption is justified directly before a notary, making the process more agile.
Who has to pay this tax?
This tax does not apply strictly only to non-residents. In fact, it affects any individual or company making a foreign real estate investment in Andorra.
It mainly includes three scenarios:
- The first and most common: individuals who do not reside in Andorra and want to purchase a property in the country. In this case, the tax applies directly.
- The second case includes individuals who already live in Andorra but cannot prove a minimum effective residence of three years within the last ten. In other words, new residents or profiles who have recently settled in the country and want to invest in real estate.
- Finally, it also applies to companies with foreign participation. This includes both companies from outside Andorra and Andorran companies with foreign capital participation.
Therefore, before purchasing, it is important to carefully analyze your personal or corporate situation to understand how taxation will apply in each case.
What costs you need to take into account
Beyond the property price and financial requirements, all associated costs must be considered: taxes (in addition to the foreign real estate investment tax), notary fees, registry and other administrative expenses.
In this type of transaction, these costs can represent a significant difference compared to the initial price. Therefore, it is essential to have them clearly defined from the beginning.
At this stage, having proper advice not only provides a clear view of the real cost but also helps structure the investment correctly and avoid decisions that could increase costs or limit options in the future.
The timeline of the process
It is not immediate, but it is not complex if managed properly.
The most important thing is to consider timelines from the outset and coordinate each phase carefully, especially when other elements are involved.
Location is also an important decision
In Andorra, location carries much more weight than it may initially seem. It is not just a matter of lifestyle, but also how the property will evolve over time.
• Buying in the center
The country is small, but the real estate market varies greatly depending on the parish. Areas such as Andorra la Vella or Escaldes concentrate most services, commerce and economic activity. This makes them especially attractive for those seeking everyday convenience.
• Living close to the mountains
On the other hand, parishes such as Ordino, La Massana or Canillo offer quieter environments, closer to nature and with a slower pace of life. These are highly valued options for permanent residence, especially for profiles that prioritize quality of life over centrality.
It is also important to consider factors such as orientation, views, access or proximity to ski slopes or schools, depending on your lifestyle. In a market like Andorra’s, these details have a direct impact on demand and property value.
Do you want to buy a property in Andorra?
Each transaction has its own particularities, and the new context makes it even more important to analyze each case individually.
Contact us and we will help you integrate the purchase of your property into a well-structured passive residency strategy in Andorra.