Mortgaging an existing property to renovate
The renovation is only co-financed against additional security — the tasación values the property's condition today, not after the works. Buyers who already own an unencumbered property typically cover the renovation by mortgaging it instead. Anonymised examples from our brokerage practice.
In short
Do Spanish banks co-finance the renovation?
Only against additional security. The purchase loan is calculated on the purchase price or the valuation — whichever is lower; the condition after the works does not count towards it.
How were the works paid for?
Through whole-project planning: all measures costed before the purchase, funds secured from the outset — from equity or by raising capital against a property at home.
Can a consultation help?
Yes — the initial consultation is free and without obligation and shows what is feasible in your situation in Spain or Portugal.
Can I finance the purchase and the renovation together in Spain?
Not through the Spanish bank — as a rule it does not co-finance the renovation. The Spanish mortgage is calculated on the lower of purchase price and tasación, customarily up to around 70 per cent for non-residents; the value after the works plays no role for the loan-to-value. Purchase and renovation therefore belong in one overall plan: the works are costed before the purchase, and the funds come from equity or from raising capital against a property you already own in Germany — up to 80 per cent of the lending value, unencumbered or, with very good creditworthiness, as a second charge. Anyone who raises the renovation only after the notary appointment ends up seeking top-up finance on worse terms, or paying from their own funds. The practical order is: obtain quotations, put a figure on the works, arrange the overall financing, then buy. The cases here show how widely the renovation share can vary when it is planned in from the start.
Renovation in the overall plan — from practice
Anyone who plans the renovation in from the start avoids later financing gaps. The following case reports show, in anonymised form, how purchase price, acquisition costs and planned measures were planned and covered together from the outset in Spain and Portugal.
Why Spain works differently from Germany here
In Germany, modernisation costs are routinely co-financed. In Spain, as a rule, they are not: the bank lends against the purchase price or the valuation — whichever is lower — and the valuation reflects the condition today, not the value after the works. Combined "purchase plus renovation" products in the Spanish market are aimed at residents with their main home in Spain and are no answer for non-residents.
What works in practice is planning the whole project: all measures are costed before the notary date, the mortgage is calculated on the purchase price, and the funds for the renovation are secured from the outset — from equity or, where available, by raising capital against a property at home.
Renovation co-financed — six model cases with additional security
The cases further down are real, anonymised reports; in those the renovation was paid from equity. The six below are calculated model cases — they show what additional security carries, and they differ in size on purpose, because a finca on Mallorca works with different sums than a house near Braga.
The arithmetic is always the same: the Spanish or Portuguese bank lends up to 70 % of the purchase price and values the property as it stands today. An unencumbered property in Germany is mortgaged up to 80 % of its valuation; that second loan covers the renovation and the equity share of the purchase. Purchase costs remain own funds in every case.
| Model case | Purchase price | Renovation | Purchase loan 70 % | Loan against the additional security | Valuation it needs to carry | Purchase costs from own funds |
|---|---|---|---|---|---|---|
| Mallorca — finca near Santanyí | 950.000 € | 238.000 € (25 %) | 665.000 € | 523.000 € | 654.000 € | 105.000 € |
| Costa del Sol — villa in Marbella | 780.000 € | 156.000 € (20 %) | 546.000 € | 390.000 € | 488.000 € | 86.000 € |
| Algarve — townhouse in Lagos | 520.000 € | 156.000 € (30 %) | 364.000 € | 312.000 € | 390.000 € | 52.000 € |
| Costa Blanca — house in Jávea | 420.000 € | 105.000 € (25 %) | 294.000 € | 231.000 € | 289.000 € | 46.000 € |
| Canary Islands — apartment on Tenerife | 340.000 € | 68.000 € (20 %) | 237.999 € | 170.000 € | 213.000 € | 37.000 € |
| Mainland Portugal — house near Braga | 260.000 € | 78.000 € (30 %) | 182.000 € | 156.000 € | 195.000 € | 26.000 € |
Calculated model cases, not documented individual cases and not a financing commitment. Amounts rounded, no interest rate stated. Whether a bank takes this route is decided by its credit policy — creditworthiness, the property and the location of the additional security. Brokerage under § 34i GewO by Olga Nikushkina · no legal or tax advice.
There is a floor: the loan against the additional security starts at around €150,000. Anyone looking to finance only €40,000 of works will not get there this way — for them the renovation stays in the whole-project plan, paid from equity.
Frequently asked — renovation in the overall plan
Do Spanish banks co-finance the renovation?
How were the works paid for in these cases, then?
Can a consultation help in this situation?
Are the figures shown transferable?
Cases from this theme — by region
Mallorca
Practical case Mallorca: Charming finca near Santanyí
Modernisation planned in from the start
Practical case Mallorca: Family house in Alcúdia
When the sale of the previous property is part of the financing
Practical case Mallorca: Finca with guesthouse in Deià
Two generations realise their dream together
Practical case Mallorca: Villa in Pollensa
With an existing property in Germany as a solid foundation
Practical case Mallorca: Apartment in Porto Cristo
The first property purchase abroad with careful preparation
Practical case Mallorca: Detached house in Llucmajor
From holiday home to permanent residence
Tenerife
Practical case Tenerife: Exclusive villa in Costa Adeje
The dream of year-round life on the Canary Islands
Practical case Tenerife: Modern apartment in Los Cristianos
The first residence on the Canaries after working life
Practical case Tenerife: Apartment in Santa Cruz de Tenerife
Living in the island capital rather than a holiday resort
Practical case Tenerife: Apartment in Playa de las Américas
From second home to centre of life
Gran Canaria
Practical case Gran Canaria: Villa in Meloneras
High-quality living with a view of the Atlantic
Practical case Gran Canaria: House in Las Palmas de Gran Canaria
Family life in the island capital
Practical case Gran Canaria: Apartment in Playa del Inglés
The step from holiday guest to permanent resident
Practical case Gran Canaria: Apartment in Maspalomas
Planning retirement in the sun early
Practical case Gran Canaria: Villa in San Agustín
Deliberately keeping the home in Germany
Canary Islands
Practical case Fuerteventura: Detached house in Corralejo
More space for family and home office
Practical case Lanzarote: House in Puerto del Carmen
Gradual emigration with well-considered financing
Practical case Lanzarote: Villa in Costa Teguise
High-quality living with long-term asset planning
Practical case La Palma: House in Puerto Naos
A new start after the coastal town's reopening
Costa Blanca
Practical case Costa Blanca: Penthouse in Altea
The proceeds from a company sale as a solid basis
Practical case Costa Blanca: Detached house in Dénia
Realising the dream of a home with existing rental income
Practical case Costa Blanca: Villa in Albir
When two incomes from different countries come together
Benidorm: Financing a modern apartment with a sea view for a permanent centre of
Anyone who wants to use a home in Benidorm permanently should not focus solely on the purchase price.
Alicante: city apartment with historic flair and comfort
In city-centre locations in Alicante in particular, a close look at existing properties is worthwhile.
El Campello: Financing a detached house near the beach for a permanent centre of
A well-kept existing house in El Campello often offers a very good ratio between living quality and location.
Villajoyosa: Financing a townhouse near the old town for a permanent centre of l
Existing properties in Villajoyosa often offer an attractive combination of location, charm and living quality.
Guardamar del Segura: Financing a villa near the dunes for a permanent centre of
Buyers with an entrepreneurial background in particular do not have to invest all their equity in a property.
Orihuela Costa: Financing a modern penthouse for a permanent residence
Modern new-build or nearly new existing apartments too often cause additional investment before they fully match one's own living wishes.
Torrevieja: Financing a terraced house for a new start on the Mediterranean
For the transition into retirement in particular, balanced financing is often more sensible than the full use of existing assets.
Costa del Sol
Marbella: Villa financing for a permanent centre of life
For high-quality properties in Marbella too, it is sensible not to consider the purchase price alone.
Puerto Banús: Financing an exclusive apartment at the marina for a permanent res
Exclusive properties too often need individual adaptations before they fully match personal living ideas.
Nueva Andalucía: Financing a golf villa for life on the Costa del Sol
Even with exclusive villas, additional investment often arises before the property fully matches one's own ideas.
Estepona: Financing a modern detached house between the old town and the coast
Modern houses too often need individual adaptations before they fully match personal requirements.
Benahavís: Financing a villa with a panoramic view for a permanent centre of lif
With high-quality properties, additional investment often arises even though the property is already in very good condition.
Mijas: Financing an Andalusian country house for life between the coast and the
Not every property with a rural character is automatically a rustic finca.
Fuengirola: Financing an apartment near the beach for a permanent centre of life
In cities like Fuengirola in particular, a look at well-located existing apartments is worthwhile.
Benalmádena: Financing a penthouse with a sea view for a permanent centre of lif
High-quality new-build or nearly new properties too do not always fully match personal living ideas.
Málaga: Financing a city apartment in the historic centre for a permanent centre
City-centre apartments are often convincing for their location and character.
Nerja: Financing a villa with a sea view for a permanent centre of life
Even if a property is already in good condition, targeted modernisation before moving in is often worthwhile.
Casares: Financing a detached house between the coast and nature for a permanent
Casares is especially interesting for buyers who deliberately prefer a quieter residential setting without wanting to give up good accessibility of th
Sotogrande: Financing a high-quality villa for a permanent centre of life
In the high-priced segment too, financing should not be aligned exclusively with the purchase price.
Manilva: Financing a terraced house with a sea view for a permanent centre of li
Manilva shows that attractive residential locations on the Costa del Sol do not necessarily have to be in the top price segment.
Torrox: Financing a detached house for retirement on the eastern Costa del Sol
Anyone planning their retirement for the long term should think about future requirements already at the property purchase.
La Cala de Mijas: Financing a modern apartment for a permanent centre of life
La Cala de Mijas offers not only an attractive coastal location but also excellent conditions for year-round living.
Costa de Valencia
Valencia: Financing an apartment in the Pla del Real district for a permanent ce
Valencia is one of the cities where high-quality existing apartments often offer more living quality and better locations than many new builds.
Castellón de la Plana: Financing a townhouse for a permanent centre of life
Cities like Castellón de la Plana often offer attractive residential locations at a price level that is barely found in other coastal regions any more
Peñíscola: Financing an apartment with a sea view for a permanent centre of life
Apartments in good existing complexes too often benefit from targeted modernisation before moving in.
Vinaròs: Financing a detached house near the coast for a permanent centre of lif
Attractive homes with a balanced price-performance ratio are also found outside the well-known coastal metropolises.
Gandia: Financing an apartment in the city centre for a permanent centre of life
Not every future centre of life in Spain has to be right on the beach.
Playa de Gandia: Financing a beachside apartment for a permanent centre of life
An apartment near the beach places different requirements than a property inland.
Gandia: Financing a detached house in a quiet residential setting for a permanen
Not every buyer wants to live right on the coast.
Cullera: Financing a penthouse with a view of the Mediterranean for a permanent
Cullera offers an interesting alternative to the well-known metropolises on the Spanish Mediterranean coast.
Oliva: Financing a villa in a quiet residential setting for a permanent centre o
Oliva shows that quiet residential locations, good infrastructure and proximity to the sea can be combined excellently.
Alcossebre: Financing a bungalow near the coast for a permanent centre of life
Anyone planning retirement in Spain should think about future living needs already at the property purchase.
Oropesa del Mar: Financing an apartment with a generous terrace for a permanent
An apartment near the coast often offers a high quality of life but should be tuned to the requirements of year-round living.
Benicàssim: Financing a villa near the beach for a permanent centre of life
Benicàssim offers not only attractive beach locations but also quiet residential areas with a high quality of life.
Costa Brava
Apartment in Roses at 60+ — renovation planned in
Sea view with modernisation from the start
Townhouse in Empuriabrava — self-employed developer
Living permanently by the water with well-considered overall financing
Detached house in Begur — architect couple relocating
Mediterranean living between the old town and the coast
Penthouse in Palamós — retiring after the handover
Comfortable living with a view of the marina
Terraced house in Platja d'Aro — family of four
Family life on the Costa Brava with long-term planning
Apartment in Cadaqués — dentists nearing retirement
Living permanently in one of Spain's most extraordinary coastal settings
Villa in Tossa de Mar — after selling the business
Mediterranean living with a long-term financing strategy
Financing a detached house in Lloret de Mar
Living year-round with room for family and home office
Algarve
Lagos: Financing a villa near Ponta da Piedade for a permanent centre of life
Lagos combines an exceptional coastal landscape with excellent everyday infrastructure.
Madeira
Apartment in Funchal — financing in retirement
Living permanently with an Atlantic view on Madeira
Townhouse in Câmara de Lobos — self-employed buyer
Authentic living a short distance from Funchal
Villa in Ponta do Sol — doctors phasing out work
Living on Madeira's sunny side with long-term planning
Genuine finca in Calheta — outside the urbanisations
Living permanently in the rural west of Madeira
Mainland Portugal
House in Braga — developers working fully remote
Family life in one of Portugal's most dynamic cities
Apartment in Porto — after years of mobile work
Urban living with a long-term perspective
Townhouse in Lisbon — architect couple from Zurich
Combining historic architecture and modern living
Apartment in Cascais — moving after working life
Living close to the coast with well-considered overall financing
Villa in Sintra — entrepreneur and interior designer
Historic setting and modern living in the countryside
Terraced house in Coimbra — teachers in retirement
A historic university city as a new centre of life
House in Évora — chemists after their careers
Living in the heart of the Alentejo with long-term planning
Apartment in Aveiro — remote-working couple
Modern living between canals and the Atlantic
A similar situation in Spain and Portugal? Let's talk.
Every financing in Spain and Portugal is an individual case. In a free initial consultation I will tell you honestly what is feasible and which bank fits.
Book a free consultationAnonymised individual case, not a binding statement for other projects · Siegfried Perini for the owner Olga Nikushkina · §34i GewO · no tax or legal advice · no financing commitment; conditions depend on creditworthiness, loan-to-value and bank