Buying Property in Ibiza in 2025? Best locations and legal issues you must avoid!

Author: Daniel M.

Profession: Lawyer

Completed cases: 21

Daniel Raso, a seasoned lawyer in Spain, specializes in real estate law. With over 30 years of experience, he provides expert guidance on property transactions, ensuring legal security and smooth processes for buyers and sellers.

View Daniel's full Bio

Author: Daniel M.

Daniel Raso, a seasoned lawyer in Spain, specializes in real estate law. With over 30 years of experience, he provides expert guidance on property transactions, ensuring legal security and smooth processes for buyers and sellers.

Speaks languages:

View Daniel's full Bio

As an English speaking lawyer in Spain, I’ve seen so many people’s dreams of owning a piece of this Mediterranean paradise – and I’ve also seen how quickly those dreams can turn into nightmares without proper legal guidance. Let me take you through the essentials of buying property in Ibiza, from legal pitfalls to hidden gems.

Depending on who you talk to, you will hear many suggestions on the best places to buy in Spain. Everyone is entitled to an opinion, but Ibiza has a lot to offer – especially if you are going to rent the property out to holidaymakers to help pay the mortgage you took out to finance the purchase. Consulting a real estate agent is crucial in this process to make sure you make the right decision and navigate the market.

Buying a house in Ibiza allows the owner to rent the property out during the holiday season to earn some money – and then use the property as a holiday home to enjoy during the off-peak season in this sunny and warm island.

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If you find a house in Ibiza that you are interested in buying, an important first step – and one certainly to take before making any payment – is to check the property’s legal situation. This is crucial because there are many properties in Ibiza that have been built illegally or have been extended illegally at some point.

The tax rates for properties in Ibiza are based on the declared sale price. For example, residential properties, land, commercial premises and garages/storage rooms all have different tax rates depending on the declared sale price.Depending on the works carried out and when they were carried out, the new owner can receive a fine for those works and even a demolition order. Or there are houses in Ibiza that while they were built illegally will not give rise to a fine.

But the new owner will not be allowed to refurbish the house (‘fuera de ordenacion’). With its complex topography and more than precious landscapes, buying a House in Ibiza can turn into a financial nightmare: this has happened to quite a few people.

If you are buying property in Ibiza, it is very important to do a preliminary inquiry into its legality before making any payment or assuming any obligations. One of the key stages in the property buying process in Spain is the private contract and deposit payment.

On this island there are many properties or extensions to properties that do not comply with the current planning rules and nor do they have the necessary permits and therefore are not legal.

This affects mainly rural properties, many of which were houses built in Ibiza many years ago by their original owners who failed to apply for official planning permission to build the properties.

Furthermore, many such properties are located in protected areas where construction of residential property is prohibited.

As a result of the above, we would strongly recommend that a prospective purchaser contacts a legal expert to advise on whether the type of building or extension in question can be successfully legalized or not. This will depend - among other things - on the exact location of the property, the size of the construction, build date, whether there are any ongoing disciplinary proceedings from the local authorities relating to the property - or not.

The government is currently (early 2024) putting the finishing touches to an amnesty for illegal houses built on rural land. This will bring to light all those properties built without permits that as of now can’t be demolished. The solution? Legalization, but at a price.

Key Points

1. Fine for Legalization: Property owners will have to pay a fine, estimated between 15% to 25% of the purchase price.
2. The amnesty will apply to houses built before a certain date (built at least 8 years ago)
3. Owners will have to pay fines and ensure their properties meet current building standards.
4. Beyond Houses: The amnesty may apply to illegal swimming pools, porches and extensions.
5. Inspired by Past Measures: This measure is inspired by a similar one implemented during José Ramón Bauzá’s term in office.

For example, not so long ago an international musician was fined for building an illegal house in St. Antonio. The Palma Court sentenced him to 6 months in prison and a fine of 10,800€ for a crime against land management (delito contra la ordenación del territorio) for building his residence in rural Ibiza. The house was demolished in 2009 as per a court ruling that declared the construction illegal in 2001.

So when buying property in Spain - and Ibiza in particular - it is crucial to have clear answers regarding the legality of the property before buying a home since a buyer could well have to pay very high costs to legalise the property (if that is even possible) and could even be exposed to significant fines from the authorities.

Buyers should also allocate 1% of the purchase price for legal fees and seek advice from a lawyer for wealth tax matters.

Never try to do this yourself - always have an independent lawyer to assist (not one recommended by any party to the conveyance who will receive fees/commission only if the conveyance goes ahead) to assist.

Of course, Advocate Abroad Ibiza will help clients who are concerned about the legality of any property they are interested in buying.

Also, to be able to rent your property to tourists you will need a special permit (tourist licence) which can only be issued if the property is legal. Property registry fees are one of the purchase costs that the buyer has to pay, typically around 1% of the purchase price. It goes without saying that if you find yourself in any of the above situations your dream home in Ibiza could turn into a financial disaster.Of course, you need an independent expert to evaluate the legal situation of any house in Ibiza you are interested in buying. Such an expert will advise you if the type of building or extension in question can be legalised or not.

This will depend - among other things - on the exact location of the house, the size of the construction, build date, whether there are any ongoing proceedings from the local authorities relating to the property - or not.

1. Hire an Independent Lawyer: And I don’t just say this because I am one. An independent lawyer (not one recommended by the seller or agent) is essential for navigating Ibiza’s complex property laws.
2. Do a Thorough Legal Check: Before making any payments or commitments, ensure your lawyer checks the property’s legal status, including all constructions and extensions.
3. Check for Ongoing Proceedings: Your lawyer should verify if there are any ongoing disciplinary actions or fines associated with the property.
4. Consider Location: Each area of Ibiza has its own charm—and its own set of regulations. From the bustling San Antonio to the exclusive Talamanca, make sure you understand the local context.
5. Think Long-Term: Consider your plans for the property. Will you need that tourist licence? Are you planning renovations?

These should be your guiding principles.

Now we look at specific areas in Ibiza that are of interest to expats looking to relocate to Ibiza:

Cala Jondal, on Ibiza’s south coast, is famous for its upmarket beach scene and crystal clear waters. This stylish area attracts celebrities and jet-setters making it one of the island’s most exclusive destinations.

Cala Jondal offers the perfect blend of natural beauty and luxury amenities for those who want the high-end Ibizan lifestyle. You need to work with knowledgeable and trustworthy estate agents when buying property in areas like Cala Jondal.

The beach is a pretty pebble and sand cove surrounded by pine clad hills and dotted with some of Ibiza’s most famous beach clubs. These establishments offer gourmet dining, stylish lounging areas and a vibrant yet refined atmosphere. 

Despite its popularity Cala Jondal never feels crowded. The area is residential with luxury villas nestled in the hills and offering privacy and stunning views.

Cala Jondal: Pros & Cons

1. Exclusive and upmarket atmosphere.
2. Beautiful beach with crystal-clear waters.
3. Home to some of Ibiza's most famous beach clubs.
4. High-end pricing for properties and local services.
5. Busier during peak season.
6. Limited public transport.

Eivissa, or Ibiza Town, is the heart of Ibiza, a vibrant mix of nightlife, historical sites and cosmopolitan lifestyle. It’s famous for its lively atmosphere and has something for everyone from partygoers to culture lovers.

Eivissa has a rich cultural heritage with UNESCO World Heritage sites such as Dalt Vila, the ancient fortified town. The rise in property prices and demand for different types of properties in the real estate market in Eivissa reflects its growing popularity.

The area comes alive at night with world-famous nightclubs, bars and restaurants. During the day, residents and visitors enjoy exploring the narrow streets with boutique shops and cafes. The town also has stunning beaches like Talamanca perfect for relaxation and water activities.

Ibiza City: Pros & Cons

1. Rich cultural heritage and historical sites.
2. Lively nightlife and dining options.
3. Good amenities and services.
4. Higher prices.
5. Busy during peak tourist season.
6. Noisy environment, especially at night.

Es Cubells, on Ibiza’s south west coast, is a hidden gem known for its unspoilt beauty and peaceful atmosphere. This small, pretty village is a genuine slice of traditional Ibizan life, attracting those who want privacy, authenticity and stunning sea views.

Popular among discerning residents and visitors, Es Cubells is the perfect location for those who value exclusivity and natural beauty. The high price of properties in exclusive areas like Es Cubells reflects the premium for such locations. 

The area has a cliff top setting with panoramic views of the Mediterranean. Es Cubells has a low-key charm with a white church, a few local restaurants and secluded coves accessible via winding paths.

The countryside is dotted with luxury villas many with sea views. While quiet, the area is still within reach of Ibiza Town and the airport making it a convenient yet secluded retreat.

Es Cubells: Pros & Cons

1. Stunning sea views and unspoiled natural beauty.
2. Exclusive and tranquil atmosphere.
3. Authentic Ibizan village experience.
4. Limited local amenities and nightlife.
5. Steep terrain may not suit all.
6. Higher-end prices.

Santa Eulària des Riu, on Ibiza’s east coast, is a peaceful and family-friendly area perfect for those who want tranquility. Famous for its relaxed atmosphere it has sandy beaches, a charming town centre and a picturesque marina.

The area is popular among families, couples and retirees. You need to work with a real estate agent when buying property in family-friendly areas like Santa Eulària des Riu.

Santa Eulària des Riu has a peaceful vibe with a mix of traditional charm and modern amenities. The town is a cultural hub with events like traditional dances, music festivals and art exhibitions.

Outdoor enthusiasts enjoy hiking, cycling and water sports. The local dining scene offers diverse options from traditional Spanish tapas to international cuisine.

Santa Eulària: Pros & Cons

1. Peaceful and relaxed atmosphere.
2. Beautiful beaches.
3. Good amenities and family-friendly environment.
4. Quieter nightlife.
5. Seasonal quietness.
6. Limited public transport compared to busier areas.

San Antonio, on Ibiza’s west coast, is a lively and energetic town famous for its sunset strip and nightlife. This dynamic area attracts a mixed crowd from young partygoers to families who want a mix of excitement and Mediterranean charm.

San Antonio has beautiful beaches, water sports and pulsating entertainment. You need to work with knowledgeable and trustworthy real estate agents when buying property in lively areas like San Antonio.The town centre is bustling with activity with bars, restaurants and shops to suit all tastes and budgets. San Antonio’s famous Sunset Strip has legendary bars and cafes where visitors gather to watch the sunset.

Despite its reputation for nightlife the area also has family friendly attractions like nearby beaches, water parks and boat trips. The newly revamped promenade is a pleasant place to walk and cycle along the coast.

San Antonio Pros & Cons

1. Lively nightlife and entertainment options.
2. Beautiful beaches and famous sunset views.
3. Good transport links to other parts of the island.
4. Can be very busy and noisy during peak season.
5. May not suit those seeking a quiet, traditional Ibizan experience.
6. Some areas may require renovation or updating.

Talamanca, on Ibiza’s south east coast, is a peaceful retreat just minutes from the bustling Ibiza Town. This upmarket area is perfect for those who want a balance of tranquility and proximity to urban amenities. Famous for its beautiful crescent shaped beach and crystal clear waters, Talamanca attracts a mixed crowd of residents from young professionals to families and retirees.

When buying property in upmarket areas like this it’s essential to work with a reputable real estate agency to ensure trust and professionalism.

The area has a sophisticated ambiance with a mix of modern luxury and Mediterranean charm. Talamanca’s promenade is lined with trendy restaurants, cafes and beach clubs offering a taste of the Ibizan lifestyle.

While quieter than Ibiza Town it still has easy access to the island’s nightlife and cultural attractions. Water sports enthusiasts can enjoy paddleboarding and kayaking while nature lovers can explore nearby walking trails.

Talamanca Pros & Cons

1. Stunning beach and beautiful coastal views.
2. Upmarket and peaceful residential area.
3. Close to Ibiza Town and its amenities.
4. Higher prices than some other areas.
5. Can be busy during peak season.
6. Limited local shopping compared to larger towns.

If you are serious about moving to Ibiza you should be aware of the everyday costs of living here.In general as much as Ibiza is famous for its lifestyle and beautiful scenery this is reflected in the cost of living. Also to be aware of is that islands are more expensive than mainland because all goods have to be transported to the island. And the high purchase price of properties in Ibiza affects the overall cost of living.

Below is an overview of the cost of living in Ibiza covering housing, utilities, food, transport and entertainment.

Housing

Housing costs in Ibiza can be high, particularly in popular areas. Renting a one-bedroom apartment in the city center of Ibiza can range from €1,800 to €2,000 per month, while outside the city center, prices can be between €900 and €1,800. For those looking to buy, the average price per square meter in the city center is around €5,000, while outside the center, it can range from €3,500.

Utilities

Monthly utility costs for an 85m2 apartment including electricity, heating, cooling, water and garbage collection are around €217. Internet services add another €55 per month.

Food and Dining

For one person groceries can cost around €200 to €300 per month. Eating out varies widely, a meal at a cheap restaurant is around €14 and a three course meal for two at a mid range restaurant is around €85. Basic groceries like milk (€1.20/liter), bread (€3.00) and eggs (€3.00/12) are moderately priced.

Transport

Public transport is affordable, a one way ticket is around €2. A taxi ride starts at €3.83 and then €1.21 per km. Owning a car involves additional costs like insurance and maintenance which can be high.

Healthcare

Ibiza has good healthcare services. Public healthcare is available but many expats opt for private health insurance which can cost between €50 and €150 per month depending on the coverage.

Education

Public schools are free but private and international schools can cost between €6,000 and €15,000 per year. The quality of education in these schools is generally high.

Entertainment and Leisure

Ibiza has plenty of entertainment options. Gym memberships are around €75 per month and cinema tickets are €8.50 each. Dining out and enjoying the island’s nightlife can vary in cost but is generally more affordable than in major European cities.

Although Ibiza does not find itself on this list, due to its size and population, it will be comparable to Palma de Mallorca.

Can foreigners buy property in Ibiza?

Yes, foreigners can buy property in Ibiza without any restrictions. The process is straightforward and similar to that for Spanish citizens. Foreign buyers need a Spanish NIE (Número de Identificación de Extranjero) number, which is an identification number for foreigners. Additionally, opening a Spanish bank account is highly recommended to manage property-related transactions. If financing is required, foreign buyers can apply for a mortgage with Spanish banks, which typically require proof of income and bank statements. Certain procedures may also require a visit to the Spanish Embassy.

Why is property so expensive in Ibiza?

Property in Ibiza is expensive due to several key factors. Firstly, Ibiza's popularity as a premier tourist destination creates high demand for real estate. The island's limited land availability further drives up prices, as there is a finite amount of space for new developments. Additionally, Ibiza's attractive climate, beautiful beaches, and vibrant nightlife make it a desirable location for both vacation homes and permanent residences. The influx of international buyers and celebrities also contributes to the competitive market, increasing property values. Lastly, strict building regulations help preserve the island's natural beauty but limit the supply of new properties, maintaining high prices.

How much is property tax in Ibiza?

Property tax in Ibiza, known as Impuesto sobre Bienes Inmuebles (IBI), varies depending on the municipality and the property's cadastral value. Typically, the IBI rate ranges from 0.4% to 1.1% of the property's cadastral value. In addition to IBI, property owners may also be subject to other taxes such as the annual wealth tax and non-resident income tax, if applicable. It's important to check with local authorities for precise rates and any additional tax obligations specific to your property.