How is the purchase of housing and real estate in Andorra?

The real estate market in Andorra is in the spotlight of many interested parties looking to invest in the country, relocate to the Principality, or acquire a second home.

In this article, we will talk about what we need to consider during the purchase of a property and the procedures that must be carried out when acquiring real estate in Andorra.

Procedures to acquire a home in Andorra

As in any other place, Andorra has a series of processes that must be completed to fully acquire the ownership of a property.

Firstly, there is a clear distinction between being a resident or non-resident of the country. This will determine the different procedures and processes for acquiring a property.

If you are not a resident of the country, what is needed is the authorization for foreign investment in real estate, which is granted by the Andorran government. This process is quick and simple.

A copy of the passport for identification purposes and a certificate of criminal record from the country of origin must also be submitted.

Finally, another requirement is to have an Andorran bank account to manage all the expenses generated by this type of transaction.

You’re interested in: How to open a bank account in Andorra

In the case of being a resident, the requirements and regulations are much less demanding and similar to those of other countries.

The purchase is made before a notary to certify the transfer of ownership along with the change of name of the property deeds.

Likewise, in parallel, the seller must present the certificate of habitability to ensure that the property is suitable for living. With the delivery of this certificate, the sale is formalized.

The final procedure is to face the costs derived from this type of transaction.

What expenses must be faced for the acquisition of a property in Andorra?

One of the great benefits and attractions of the country is its low taxation with its low taxes. This makes it especially interesting for many foreign investors.

In Andorra, when you acquire a property, you must pay the Property Transfer Tax (ITP). This amounts to 4% of the property’s price and is paid before notaries at the time of the purchase deed.

On the other hand, there are the notary fees, which are borne by the buyer.

Finally, other expenses to consider are the fees corresponding to the services provided by the real estate agency. These range between 5% and 10% of the property’s value.

All these expenses are still much lower than the costs associated with this type of transaction in neighboring countries such as France and Spain.

The current situation of the real estate market in Andorra

Despite the rise in prices and the economic context we find ourselves in at present, the real estate market in the Principality continues to grow, managing to close a total of 578 transactions in the last recorded quarter (2nd quarter 2022).

This has resulted in an increase of more than 20% in this type of operations, translating into a 27.2% increase in the number of real estate properties sold in the country, more than 325 properties compared to the previous year.

It is worth noting that within these real estate properties we find apartments, single-family homes, buildings, land, and parking spaces.

The price per square meter in Andorra

The country’s appeal, along with ongoing reforms aimed at attracting foreign investors, has led to a constant influx of new residents to the country every day.

This has resulted in such high demand that the residential supply is unable to meet it, as the country’s geographical limits constrain the market.

Currently, there are real estate developments to suit all tastes, from those focused on nature and ski resorts to projects located in the city center.

The average price per square meter reached €3,723 in June 2022, a price that has increased compared to the previous quarters. However, the cost of utilities such as electricity and water is lower compared to other countries.

The most sought-after homes in Andorra

Since the pandemic, Andorra has experienced increased demand for residential properties, from local clients to foreign investors.

From a local perspective, residences with open and outdoor spaces, away from the city, are sought after. The lack of freedom during the lockdown has led residents to want to enjoy nature much more.

On the other hand, foreign investors see Andorra as an opportunity for investment in large properties and second homes. The most prominent nationalities are those of neighboring countries, such as Spain, France, and Portugal.

Also, check our blog for more detailed information on why investing in the country, how to do it, and all the options available to you.

If you have decided to buy a property as an investment or to establish your residence in Andorra, you will not regret it.

The quality of life, its strengths such as safety, and the incredible landscapes it offers make the country a perfect destination to start from scratch.

Furthermore, if you have embraced the lifestyle of digital nomads, Andorra’s advantages are even more appealing.

From Wit, we can accompany you throughout this process, making each procedure easy and turning your relocation into a reality. Get to know us!

Related Posts

Having a Dog or Cat in Andorra

Aprendizaje del Catalán en Andorra: Integración y oportunidades

Actualizaciones en la fiscalidad inmobiliaria y la inversión extranjera en Andorra

Vacant Property Tax (IHB) in Andorra

Your Premier Choice for Security and Investment Prosperity

Andorran Tax Calendar