Costs of buying a property in Spain

Spain is no different from other countries when it comes to buying real estate. In addition to the purchase price, there are related costs, i.e. notary fees, stamp duties, registration fees, legal and administrative costs, bank charges, VAT (IVA), transfer tax, etc. ) to help you understand and estimate these associated expenses.

We also strongly recommend that you obtain professional advice – from legal and financial experts – to clarify and confirm your individual situation.

We work with a Polish-language law firm that will clarify any doubts.

Transfer taxes on property transfers from the secondary market

(Calculations based on property value range and applicable rate)

  • for apartments below EUR 400,000 you will pay 8% of the property tax
  • between 400,000 and 700,000 EUR the tax will be 9% of the property value
  • for properties costing more than 700,000 €, you will have to pay 10% tax on the property value

If you are purchasing a separate parking space, the transfer tax will be:

  • 8% up to € 30,000,
  • 9% for prices from 30,000 to 50,000 €
  • and 10% for prices above 50,000 €.

If you are a tax resident and under 35 years of age, the transfer tax can be lowered to 3.5% if the value of the property is less than € 130,000.

For disabled people who are tax residents, the transfer tax can be lowered to 3.5% up to a maximum property value of € 180,000.

The transfer tax for real estate companies is 2%.

Taxes on new real estate

If you buy a new property directly from the developer, you will pay VAT (IVA) (instead of transfer tax) at the 10% rate. In addition, you will pay a 1.5% stamp duty.

For buyers under the age of 35 and disabled people who are tax residents, the stamp duty is reduced to 0.3%.
In the case of parking spaces (purchased separately from the apartment), the VAT is 21% and the stamp duty is 1.5%.

The Andalusian government approved a decree that includes a reduction in the transfer tax (for example, the tax paid on the purchase and sale of second-hand homes), now the three rates currently set at 8%, 9% and 10% will now be replaced by a flat rate of 7%. Moreover, there will be a slight reduction of the stamp duty from 1.5% to 1.2%. The costs associated with paying these taxes when buying a used property will be significantly reduced. This new discount will only be available until December 31, 2021 and only in Andalusia.

Approximate total property purchase costs for the purchase price of EUR 250,000

Costs of buying a new property for cash: 13.9%

(These include: VAT / IVA at 10%, stamp duty at 1.2%, legal fees 1%, notary and registration fees 1%, plus 0.7% for various required documents such as power of attorney, N.I.E. application and certificates.)

The cost of buying a new property on credit: 16.4%

(These include, in addition to the above-mentioned 13.90%, 0.8% of notary fees, 0.7% for banking analysis, valuation and provision of funds, and a 1% loan start-up fee).

Please note that a mortgage loan will require a separate act, but under the new regulation, the bank will now bear the tax costs.

Costs of buying real estate from the secondary market for cash: 9.7%

(These include: 7% for property transfer tax, 1% legal fees, 1% notary fees and 0.7% for various documents such as power of attorney, N.I.E. application and certificates.)

Costs of buying real estate from the secondary market on credit: 12.2%

(These include: 9.7% as above plus 0.8% notary fee, 0.7% for banking analysis, valuation and delivery of funds, and 1% loan start-up fee)

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