First-home access program in Andorra: a new step towards ownership

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🏁 A growing need

Access to housing has become one of the main social and economic challenges in Andorra. Property prices, which have risen steadily in recent years, have made ownership seem increasingly out of reach for many families and young residents.

To offer a real alternative to renting, the Government has approved Decree 381/2025 of 22 October, creating the First-Home Ownership Program for Permanent Residence.
This initiative aims to turn rental payments into capital repayments — promoting financial stability and long-term settlement in the country.

➤ To better understand how Andorra’s housing market has evolved, read The evolution of housing prices in Andorra

🎯 Purpose and scope of the program

The new program promotes property ownership as a path to stability and financial independence.

Its purpose is to help those who can already afford a market-rate rent to purchase their first home under accessible conditions, without requiring a large initial down payment.

Beyond its social and economic benefits, the program also helps rebalance Andorra’s real-estate market, which in recent years has focused almost exclusively on rental supply.

💶 A comprehensive financial support

The mechanism combines two complementary measures:

• a 100 % public guarantee on the mortgage loan for seven years, and
• a full interest subsidy over the same period.

⚠️ In practice, the Government does not issue the loan itself — it guarantees it against potential defaults.
This guarantee enables banks to finance up to 100 % of the purchase price (up to €600 000) without requiring any buyer contribution.

❗During the first seven years, the Government covers all interest at the 12-month Euribor rate, so beneficiaries only repay the principal.

Monthly payments are capped at 33 % of household income, with repayment terms between 20 and 50 years, provided the borrower does not exceed 80 years of age at the end of the loan.

⚠️ The decree also grants a 50 % reduction in notarial and registration costs, easing the initial financial burden of the transaction.

➤ To learn how real-estate transactions are taxed in Andorra, read How capital gains on real estate are taxed in Andorra.

🧩 Eligibility requirements

Eligible applicants include:

• legal and permanent residents of Andorra for at least 7️⃣ consecutive years, except for justified absences (studies, work, or force majeure),
• Value limit of €600,000 for the property intended to be purchased.
• individuals who do not own any other property, in Andorra or abroad,
• those whose total assets are below 30 % of the home’s value,
• and those whose income is at least twice the annual minimum wage, fully up to date with tax and social-security obligations.

❗For couples or family units, only one member needs to meet the residence requirement.

📝 Application and documentation

Applications must be submitted to the National Housing Institute (INH) using the online form available at 👉 www.inh.ad

Required documentation:

• a positive bank certificate confirming the loan approval,
• a CASS contribution record and proof of income,
• a certificate from the Notaries’ Chamber confirming no property ownership,
• a sworn asset statement and the income-tax declaration,
• the property valuation and authorization to consult banking data.

Once submitted, the INH reviews the application and the Technical Housing Commission issues a resolution.

If approved, the mortgage and the state guarantee are formalized by a notarial deed and registered accordingly.

➤ To learn more about notarial functions in the Principality, read Notaries in Andorra: who they are, where they work, and since when.

💡 Operation and guarantees

The program does not provide direct funds to the buyer: the loan is granted by the bank and guaranteed by the Government.

If the borrower fails to pay three consecutive instalments, the bank may enforce the guarantee — the Government repays the debt to the bank and becomes the new creditor.
Despite the assistance, the borrower remains personally liable and may still face mortgage enforcement in favor of the Government.

It is therefore a temporary and responsible guarantee mechanism, not a non-repayable subsidy.

📜 Conditions and obligations

• The property must be used solely as the applicant’s main and permanent residence.
• It is forbidden to sell or rent the property within the first seven years.

⚠️ If a sale or rental occurs between the 7th and 27th year, the beneficiary must reimburse all subsidized interest and pay a triple penalty, except in cases of force majeure.

⚠️ From the 20th year onward, the Government retains a pre-emptive purchase right; in the event of a sale, the price must be adjusted by deducting all subsidized interest plus legal interest accrued.

These restrictions are formalized in the notarial deed and secured by a mortgage in favor of the Government.

🧮 After the seven-year period

When the seven-year guarantee period ends, it is automatically cancelled.
The mortgage then continues under standard conditions (12-month Euribor + 0.5 % max), and the Government releases the mortgage lien registered in its favor.

At that point, the borrower begins to pay both principal and interest — but on a capital already reduced thanks to seven years of accelerated, interest-free repayment.

➤ To learn more about financial planning and credit access, read Bank financing in Andorra: requirements, guarantees and strategies for businesses and individuals

🌐 International context

Several European countries have programs to support first-time homebuyers, but none as comprehensive as Andorra’s.

• In Spain, the ICO Youth Guarantee covers only 20 % of the loan and does not subsidize interest.
• In France, the Prêt à Taux Zéro (PTZ) finances between 20 % and 40 % of the property’s value interest-free, but only for new or eco-friendly homes.
• In Switzerland, there is no state guarantee, but tax incentives and the use of pension funds for the down payment.

The Andorran model — with a 100 % public guarantee and full interest subsidy for seven years — stands out as one of Europe’s most ambitious initiatives to promote homeownership.

🗓️ Entry into force

Decree 381/2025 entered into force on 30 October 2025, the day after its publication in the BOPA.

From that date, the Government may open the annual call for applications within the budgetary limits set by the Finance Law.

In summary

Through this program, the Andorran Government takes a decisive step toward turning the right to housing into a real opportunity for homeownership, emphasizing financial stability and responsibility.

The state guarantee and interest subsidy allow residents to reduce debt without excessive burden, while ensuring public funds are used with transparency and accountability.

If you would like to know whether you qualify for the program or estimate your financing capacity, you can request a personalized meeting with our team below, or fill out the contact form.

Last reviewed: November 2025.