Buying a property in Spain to rent out can work, but not the way most listings describe it. On the Costa del Sol, the rental rules have changed three times in two years, and the biggest risk in many purchases is not the price: it is buying a home that cannot legally be let the way the buyer planned. This guide is my practical route for an international buyer, from the decision on how to let to the numbers, the taxes and the checks. Reviewed on 25 October 2026.
A note on my role: I specialise in new-build and off-plan homes on the Costa del Sol and I do not offer a rental management service. I will tell you what I would check, and I am not selling you a yield. I am not a lawyer or a tax advisor either, so have both review your specific case.
First decide how you want to let
Everything else depends on this. The three options are tourist rental, seasonal rental and long-term rental, and each now has its own rules. I compare them in tourist rental or traditional rental. If you choose tourist rental, read the checks in what buyers should check before investing before anything else.
Step 1: check that the property can be let that way
- Tourist rental: registration in the Registro de Turismo de Andalucía, the three-fifths vote of the community and a town hall that has not suspended new licences. See the tourist rental rules. Some places are closed: Málaga city, parts of Manilva.
- Seasonal and long-term rental: the October 2026 decrees change the rules, and they are pending validation. See Spain’s new rental law 2026. In particular, a long-term lease can renew for five years at a time, and ending it without a listed exception costs the landlord at least twelve months’ rent. The old idea that a tenant “can extend up to five years” is now only part of the picture.
- The community: read the statutes and minutes before you reserve.
Step 2: work out the real numbers
Start with the gross yield, then move to the net.
My Costa del Sol market guide 2026 gives implied gross yields from asking prices and rents of around 5.3% in Málaga city, and around 5.7% in Estepona (asking rent about €18.28/m² a month against an asking price of about €3,854/m², 2025 data). These are relations between asking figures, before costs and taxes. They are not what you will receive. See how much properties cost in Estepona for the full numbers.
To go from gross to net, subtract:
- Community fees, IBI council tax, insurance and maintenance.
- Management or cleaning costs, if you use them.
- Void periods: weeks or months with no income.
- Income tax on the rent.
- The cost of buying, which affects the return on what you invested.
If the investment only works with a high-season occupancy all year or with a licence you do not have, I would not buy it.
Step 3: count the cost of buying
In Andalusia, a new build bought from a developer pays 10% VAT plus 1.2% stamp duty (AJD), around 11.2% in total. A resale pays 7% transfer tax (ITP). Notary, registry and legal fees come on top. For a new build of €500,000, the taxes are around €56,000. Details are in the taxes when buying a property in Spain.
Step 4: financing, if you need it
Banks lend to non-residents, but usually less than to residents, and they want a full file. I explain the process and the usual conditions in mortgages in Spain for non-residents. Do not assume rental income will be counted in full.
Step 5: understand the tax on the rent
Rental income is taxable in Spain. For non-residents, the general rates are 19% on net income for residents of the EU and EEA, who can deduct expenses, and 24% on gross income for everyone else, with no deductions. After Brexit, UK residents fall in the second group. There are also annual property taxes. My guide to property taxes for foreign owners covers them. A tax advisor should confirm how it applies to you, including how any treaty works in your country.
Step 6: management and tenants
If you do not live nearby, you will need a manager for guests or for the tenancy. Ask for references and a written contract, and ask what happens with maintenance, deposits and problems. I do not offer this service, so I can say plainly: vet them as carefully as you would vet the property.
Why a new build can suit a rental plan
New homes usually arrive with better energy efficiency, parking and shared facilities, and they let you ask the developer and the community about rental use before you reserve. They also arrive without a tenant, so you can choose your model. The catch is the usual off-plan risks, such as delays and developer solvency. I go through the balance in the rental potential of new builds.
Where I would look on the Costa del Sol
It depends on the model. For a long-term or seasonal let, towns with year-round demand, such as Estepona, are easier to reason about than seasonal resorts. For tourist rental, start with the town hall’s position, because it can end the idea. My Estepona area guide and Estepona investment analysis show how I weigh a market, and the same reasoning applies to Sotogrande, Casares, Benahavís or La Alcaidesa.
The mistakes I see most
- Buying first and checking the rental rules afterwards.
- Using gross yield as if it were income.
- Counting on a licence the property does not have.
- Forgetting the tax on rental income and the annual taxes.
- Buying a home that only works if everything goes right.
Frequently asked questions
Can a non-resident rent out a property in Spain?
Yes, but income is taxable in Spain, and tourist rentals have extra registration rules. Ask a tax advisor how it applies to you.
Is it better to buy new build or resale to rent?
Each has trade-offs. New build comes without a tenant and with better efficiency, but you buy at a premium and wait if it is off-plan. Resale is available now, but check its legal status and condition. See new build or resale in Spain.
What yield can I expect?
Implied gross yields of around 5% to 6% in the towns I follow, before costs and taxes. Net will be lower. Nobody can promise a figure, and I would not trust anyone who does.
Planning to buy a property to rent out on the Costa del Sol?
Tell me your budget, your preferred towns and how you would like to let, and I will tell you honestly which options I would look at and which I would rule out. Contact me here, or see my properties for sale in Estepona.
Sources: Costa del Sol Property Market Guide 2026 (The Property Agent), with data from Idealista, Tinsa and Engel & Völkers; Real Decreto-ley 28/2026 and 29/2026 (BOE, 7 October 2026).
