Can a Foreigner Buy an Apartment in Andorra to Rent It Out as a Holiday Property? What You Should Know Before Investing
Investing in property in Andorra continues to attract significant interest from foreign buyers. For many, the initial idea seems simple: buy an apartment, list it on Airbnb or Booking.com, and generate returns through short-term holiday rentals.
However, the current regulatory framework makes this strategy considerably more complex than it may initially appear before purchasing a property. The issue is not simply whether a foreigner can acquire real estate, but also what use can be made of the property afterwards, which authorizations will be required, and whether a tourist rental license can be maintained or obtained.
For this reason, before estimating how much a property could generate, it is worth answering a much more important question first: is the operating model we are considering actually viable?
First, a HUT and a tourist apartment are not the same thing
In Andorra, there is an important distinction between a Habitatge d’Ús Turístic, HUT, and a tourist apartment. A HUT is a residential property that is rented out in its entirety for tourist stays. Tourist apartments, on the other hand, form part of buildings specifically intended for this activity and are subject to different regulations.
This distinction is particularly important for foreign investors. When someone considers buying an individual apartment and then renting it through Airbnb or Booking.com, they are normally thinking about the HUT model, even if they casually refer to it as a "tourist apartment".
And it is precisely within this model that some of the main current restrictions can be found.
Buying an apartment that already has a HUT does not mean buying the license as well
This is probably one of the most important points any buyer should understand before completing a purchase.
Currently, a change of ownership of a HUT for any reason other than inheritance following the owner’s death results in the automatic removal of the property from the HUT Register. This means that buying an apartment that currently operates as tourist accommodation does not automatically allow the new owner to continue the same activity.
There is another key issue to consider: new HUT authorizations for apartments and studios are suspended indefinitely.
Therefore, buying a property that currently generates tourist rental income and assuming that the same income can continue after the sale may lead to a completely inaccurate financial projection.
A property may have an excellent historical performance on Airbnb or Booking.com and yet that past tourist rental profitability may not be reproducible by the new owner.
Foreign buyers are also subject to foreign investment regulations
In addition to the restrictions related to tourist use, foreign buyers must also consider the specific rules governing foreign real estate investment.
Transactions classified as foreign real estate investment are subject to a specific framework involving authorization, taxation, and administrative requirements. Therefore, being a foreign buyer does not necessarily mean that purchasing property in Andorra is impossible, but it does mean that the transaction should be analyzed carefully before it is formalized.
During 2026, taxation on these investments was also tightened, with the foreign real estate investment tax increasing to 6% for the acquisition of a first property and 10% for the acquisition of a second property, under the conditions established by the regulations.
This makes it even more important to evaluate the investment as a whole. It is not enough to consider the purchase price and potential income. Taxes, expenses, financing, rental model, and net profitability should all be taken into account.
The real problem arises when the entire investment depends on tourist rentals
A property can be a good real estate investment without necessarily being a viable tourist rental investment.
This difference is fundamental.
If the projected profitability depends exclusively on renting the property for nights or weeks, but after the purchase there is no possibility of maintaining or obtaining the corresponding authorization, the initial financial model no longer makes sense.
For this reason, it is currently particularly risky to purchase a residential apartment based only on historical Airbnb income, peak-season prices, or results achieved by the previous owner.
The first question should not be "how much does this apartment currently generate?", but rather "what type of rental activity will I legally be able to carry out once I own it?"
Does this mean a foreigner should rule out investing in residential property in Andorra?
Not necessarily. What may be necessary is to change the investment approach.
If tourist rental is not viable for the property being considered, there are mainly two alternatives that can be analyzed: seasonal rental and long-term residential rental.
On the one hand, there is residential rental intended as the tenant’s primary home, where Andorran regulations generally establish a minimum contract duration of five years. This model can offer greater stability, lower tenant turnover, and more predictable long-term income.
On the other hand, there is seasonal rental, intended for people who need accommodation for a limited period due to a genuinely temporary reason, such as relocated professionals, seasonal workers, or people staying in Andorra for several months. In these cases, shorter contracts, for example six months, may be considered, provided that the stay is genuinely temporary and the contract reflects that situation.
The distinction is important: a six-month contract does not automatically become a seasonal rental simply because of its duration. The reason for the stay and the actual use of the property are key factors in determining which type of agreement is appropriate.
Therefore, an owner who cannot operate a property as a HUT may still consider whether a seasonal rental or a five-year residential lease would be more suitable, depending on the property, location, demand profile, and investment objectives.
From a tourist rental investment to a real estate investment
This is where the perspective changes completely.
A buyer may come to Andorra expecting to generate income through short stays and then discover that, for the property being considered, the most realistic alternative may be a seasonal rental or a five-year residential lease.
The question then stops being simply "how much could this apartment generate on Airbnb?" and becomes:
Which rental model is viable, and what return can it provide after taxes, expenses, and management costs?
In some cases, a property may generate lower gross income under a five-year residential lease than through tourist rentals, but it will also have much lower turnover, fewer operating costs, and more predictable income.
In other cases, seasonal rental may provide greater flexibility and be better suited to certain locations or demand profiles, although it also requires more active management and proper justification of the temporary nature of the stay.
For this reason, comparing gross income alone can give an incomplete picture.
A genuinely attractive investment is one that combines legal viability, demand, stability, and net profitability.
Buying first and analyzing profitability afterwards can be costly
One of the biggest mistakes an investor can make is completing the purchase and only then analyzing how the property will be operated.
Before committing capital, different scenarios should be studied, including purchase price, taxes, recurring expenses, expected monthly income, local demand, contract duration, management costs, and annual net profitability.
It is also useful to compare alternatives.
For example, what happens if we buy a property intending to use it for tourist rentals but eventually have to place it under a five-year residential lease? Would it still be profitable at that monthly rent?
And what would happen if the property could be operated through seasonal rentals for periods of six months, provided there is a genuine temporary need? How would income, costs, and tenant turnover change?
These questions should be answered before signing the purchase agreement.
A financial projection can completely change the decision
This is where a profitability projection becomes particularly useful.
Instead of making a decision based only on intuition, the advertised price of the property, or historical tourist rental income, different scenarios can be created to understand what could realistically happen with the investment.
A projection can analyze factors such as purchase price, expenses, taxes, expected monthly income, gross return, net return, and the expected performance of the property over the medium and long term.
It also allows different models to be compared directly. For example, we can study how a property might perform financially under seasonal rental compared with a five-year residential lease and assess which option may make more sense depending on the investor’s objectives.
A cheaper apartment is not necessarily a better investment, just as a property with a higher monthly rent will not always provide the best percentage return.
How can AndStay help?
At AndStay, we work with the performance and management of properties in Andorra, which means we can help you analyze a property before making a purchase decision.
Through our financial projection service, we can assess the property you are considering and analyze its potential based on the rental model that can realistically be applied.
If tourist rental is not viable, we can compare different alternatives, particularly seasonal rental and five-year residential rental, estimating potential income, costs, and profitability to help you understand which strategy may be better suited to the property.
Our goal is not simply to tell you how much a property could generate, but to help you understand whether the numbers make sense before you commit your capital.
Regulation is changing the way people invest in Andorra
Regulatory changes introduced in recent years show a clear direction: Andorra is strengthening controls on foreign real estate investment and limiting the growth of certain types of tourist accommodation, while at the same time seeking to increase the supply of housing available to the residential market.
This also requires a different way of analyzing investment opportunities.
The model of buying an apartment and later converting it into tourist accommodation can no longer be taken for granted. Before completing any transaction, it is necessary to assess the specific situation of the property, the buyer’s profile, and the use that can legally be made of the property.
But that does not mean investment opportunities have disappeared.
It means that they need to be approached differently.
Conclusion
Purchasing property in Andorra as a foreigner continues to be possible in certain circumstances, but buying an apartment specifically with the intention of subsequently operating it as tourist accommodation is now a considerably more restricted and complex strategy.
Restrictions on new HUT authorizations, the removal of the registration when ownership changes, and the requirements associated with foreign investment make it essential to verify the viability of the transaction before buying.
However, a property that is not suitable for tourist rental may still be an attractive investment under other models. Alternatives that can be considered include seasonal rental, for example for six months where there is a genuine temporary need, and residential rental under five-year contracts.
The key is to determine which option is most suitable for each property and what level of profitability it can offer after all costs have been taken into account.
At AndStay, we can help through a financial investment projection, comparing different scenarios and assessing which model may make the most sense for each property.
Because before asking how much a property can generate, there is an even more important question:
What will we actually be able to do with it after buying it?
