There is a strategy that has been the queen of real estate investments on the Costa del Sol in recent years: buying to renovate and sell, taking advantage of the super-reduced Transfer Tax (ITP) of 2%. However, if you are thinking of entering this business or are a sector professional, you should know that the playing board has changed drastically with the new Budgets of the Andalusian Government for 2026. What was once a wide and comfortable highway for investing has now become a fast lane that requires much more precision and speed.
The administration has decided to tighten the screws on this tax benefit to focus it on average housing and avoid long-term speculation. The first major novelty is a reality check for the luxury market: from now on, the reduced rate of 2% has a price cap. You will only be able to benefit from it if the property you acquire costs up to 500,000 euros. If your target is high-standing villas or properties above that value, you will have to assume the general rate of 7%. This radically changes the numbers for large investors, who will have to recalculate their margins, but it remains a golden opportunity for those operating in the market of flats and apartments in areas like Benalmádena or Fuengirola.
But the change that will really keep you up at night is not the price, but the time. Until now, the law allowed a generous period of five years to resell the property and keep the bonus. That is over. The new deadline for 2026 is reduced to just 2 years. You have exactly 24 months from the moment you sign the purchase before a notary to renovate, market, and sign the final sale with a third party. If the clock strikes month 25 and you have not sold, the Tax Office will demand you return the difference of the tax saved plus default interest.
This new scenario eliminates amateurs and rewards true professionals. With only a two-year margin, you can no longer afford the luxury of a renovation that drags on forever or a passive sales strategy waiting for the “ideal client” to arrive. You need to buy with the work project almost defined and, above all, you need to have the market exit guaranteed from minute one. Here is where the figure of the “lone investor” becomes dangerous. Trying to manage renovation crews and the sale on your own within such a tight timeframe is a huge risk.
Now more than ever, the success of the operation depends on your real estate partner. You need an agency that is capable of selling your finished product in record time, someone who knows the real demand and has buyers on a waiting list. In this new context of buy to renovate and sell, agility is not an extra, it is the only way to ensure your fiscal profitability.
Despite the restrictions, the underlying message is positive: the opportunity is still there for residential housing, which is where there is the most real demand. Becoming a professional (registering under the corresponding business census heading) is still the key to accessing this 2%, but now it requires surrounding yourself with experts who understand that time is, literally, money.
Are you worried about the new 2026 deadlines for your investments?
Do not gamble with the calendar. At Hernán Bustos – Real Estate Experts, we are specialists in rapid asset rotation. Come see us and let’s design a roadmap so you can enter and exit your investment with maximum profit and zero fiscal scares.
