Mistakes When Buying Property in Tenerife (and How to Avoid Them)

Buying a property in Tenerife can go very well or cost you thousands of euros, and almost always the difference comes down to the details that are overlooked before signing. This guide covers the most common mistakes when buying a home in Tenerife and, above all, how to avoid them, with special attention to foreign buyers and the legal and tax specificities of Canarias.

Not reviewing the nota simple or the property's encumbrances

The most costly mistake is trusting the seller's word without checking the registered status. The nota simple from the Property Registry costs just a few euros and tells you who the real owner is, the registered surface area, and, most importantly, whether the property carries any mortgages, liens, easements or third-party rights.

In Tenerife we regularly encounter cases like: an inherited property with multiple owners not all of whom agree to sell, or an apartment with outstanding community fees and IBI (local property tax) receipts that the new owner ends up absorbing. Always request an up-to-date nota simple, the latest IBI receipt, and a community certificate confirming there are no outstanding debts. If anything doesn't add up in the Registry, don't proceed until it's resolved.

Misjudging the costs and taxes (and here Canarias is different)

Many buyers only budget the sale price and forget that the purchase adds between 8% and 12% extra in taxes and costs. The islands have a major fiscal difference: in Canarias, mainland VAT does not apply — instead, there is the IGIC (Canarian indirect tax).

• Second-hand property: you pay the Impuesto de Transmisiones Patrimoniales (ITP, property transfer tax), which in Canarias is around 5% to 6.5% depending on the price.
• New build: IGIC applies (usually 7% for residential property) plus the stamp duty (Actos Jurídicos Documentados).
• Other costs: notary fees, Land Registry inscription, administrative management, and if you need financing, the appraisal and mortgage costs.

Do the real maths before falling in love with a property. An apartment at 250,000 € can mean over 20,000 € in extra costs — better to have these planned than to discover them at the notary.

Buying as a foreigner without preparing the paperwork

If you are not a resident in Spain, there is a procedure you cannot skip: the NIE (Número de Identificación de Extranjero — the foreign identification number). Without a NIE you cannot sign the deed, pay taxes or comfortably open a Spanish bank account, so apply for it well in advance since appointments in Tenerife can sometimes take weeks.

We also recommend opening a bank account in Spain to set up direct debits for utilities and community fees, and consider a notarised power of attorney if you will not be on the island on the day of signing. A buyer who arrives two days before the deed signing without a NIE or bank account often ends up delaying the transaction and, sometimes, losing the property.

Signing the contrato de arras without understanding what you're signing

The contrato de arras is the preliminary agreement that reserves the property and sets the price and timelines, usually with a deposit of 10%. The common mistake is signing it without reading the fine print or knowing what type of arras is being agreed.

The arras penitenciales, the most common type, allow the buyer to withdraw and lose the deposit, while the seller can back out by returning double the amount. It's worth specifying in writing what happens if financing doesn't come through or if a hidden encumbrance appears on the nota simple. Never hand over the deposit in cash without a contract or a traceable bank transfer.

Ignoring planning legality: Ley de Costas and rural land

Tenerife has a lot of coastline and countryside, and that's where two risks appear that don't exist elsewhere. The Ley de Costas (Coastal Law) can affect properties near the sea located in public domain or coastal buffer zones, with serious restrictions on renovations or legalisation.

Inland, it's common to find rural houses or plots on suelo rústico (rural land) with unlicensed extensions or unregistered constructions. Before buying, check that the property has its licencia de primera ocupación (first occupation licence) or habitability certificate, and that what you see built matches what appears in the Catastro (land registry) and the Property Register. What seems cheap may hide a structure that can never be legalised.

Not inspecting the property and getting carried away by emotion

A property with great photos and ocean views sells itself, and so many buyers skip a closer look. Check for damp, the condition of installations, the real build quality and aspect, and bear in mind the climate in each area: the dry and sunny south doesn't require the same maintenance as the wetter, greener north.

Visit the property more than once, at different times of day, and ask about the community, the neighbours and the annual costs. An emotional impulse can be corrected with a second, cooler visit and, if needed, an architect to assess the condition of the building.

Skipping independent professional advice

The last mistake is trying to do everything on your own to save money. A local estate agent knows real prices by area and spots bargains that are actually problems, and an independent lawyer (independent from the seller) reviews the documentation and protects your interests. It's a small investment compared to what you're risking.

At Tu Nido Tenerife we accompany every purchase with registry verification, tax calculation and coordination of the signing, so you arrive at the notary without surprises.

Frequently asked questions

What are the most common mistakes when buying a house in Tenerife?

Not requesting the nota simple, miscalculating taxes (IGIC or ITP in Canarias), signing the arras without understanding them, ignoring the Ley de Costas or rural land issues, skipping the inspection and buying without independent advice. Almost all of them can be avoided with proper due diligence.

What should you check before buying a property?

The registered status via the nota simple, that there are no outstanding mortgages or debts for IBI or community fees, the first occupation licence or habitability certificate, that what you see built matches the Catastro and the Registry, and the real physical condition of the property. In coastal areas, also its relationship with the Ley de Costas.

Is it worth buying a property in Tenerife?

For many buyers, yes: a stable year-round climate, a softer Canarian tax regime than the mainland, and a solid tourist and residential rental demand. The key is to buy well, with clear numbers and verified documentation, without being driven by urgency.

How can a foreigner avoid being scammed when buying a house?

Work with verifiable professionals, always request the nota simple, don't hand over money without a contract or traceable bank transfer, and be wary of prices that are too good to be true. Having your NIE and Spanish bank account in order before signing also protects you from rush and pressure.

Buy in Tenerife with confidence

Avoiding these mistakes doesn't require being an expert — just surrounding yourself with people who are, and not skipping any step. If you are looking for your home on the island, explore our selection of apartments for sale or use the property search to filter by area and budget. And if your purchase depends on selling your current home first, we can also help you sell your property with a realistic valuation. Tell us what you're looking for and we'll guide you every step of the way.