What are the costs of buying property in Spain?
Get a handle on all of the costs associated with buying property in Spain with this quick reference guide.
![Cost of buying property in Spain](https://cdn.prod.website-files.com/646db393a844c04f2f92c678/64f0e320bc0f9a4586557d90_Calculating%20costs%20in%20Spain%201000%20x%206333.png)
One thing that can trip you up when you buy property in Spain are the additional costs associated with the acquisition.
While property prices in Spain are relatively affordable compared to the rest of Europe, the taxes and other acquisition costs can come as a surprise.
As a rule of thumb, when purchasing a property in Spain, you should budget for an additional 12-16% on top of the purchase price to cover fees and taxes. If you are intending to take out a Spanish mortgage, you will also need to factor in an additional 2-4%.
Below is an overview of the acquisition costs that you should take into account.
Transfer Taxes on Established Property
If buying an established property, the following transfer taxes or “ITP” (Impuesto sobre lasTransmisiones Patrimonilaes) for each autonomous community apply.
Transfer Taxes on New Property
If buying a new-built home, you will need topay VAT, which, with the exception of the Canary Islands, is 10% of the property purchase price.
A second tax is also added to VAT for new-built homes. This tax is known as AJD and is the equivalent to stamp duty in Spain. The actual amount depends on each Autonomous Community.
Following is a breakdown of what to expect:
Notary Fees
Notaries in Spain review official contracts, witness signatures, makesure taxes get paid and bear responsibility for recording sales on the property registry. It is the responsibility of the buyer to appoint and pay for the notary and they generally cost between 0.5% and 1% +VAT.
Land Registry
The Land Registry (Registro de la Propiedad) officially records the ownership of the property in your name once the purchase has been completed. For this, fees of between 0.5% and 1.5% +VAT are charged, depending on the purchase price, location, property type and whether a mortgage is involved.
The good news is that if you have taken out a mortgage, the financial institution who you took out the mortgage through is responsible for this payment.
Legal Fees
Legal fees are usually a percentage of the purchase price – generally 1-2% +VAT. With Expat Estate, the majority of the legal fees are included in our buyer advisory fee.
Mortgage Costs
If you need to take out a mortgage there will be some additional costs that will vary depending on the financial institution you get the loan through. Generally, you will need to pay for a valuation on the property which will cost between €250 – €600. Once the valuation is complete, it is valid for 6 months from the date of issue.
Some banks may charge you a fee to either open an account or take out a mortgage and this fee can be up to 2% of the capital loaned. Note that in order to take out certain mortgages, banks may also require you to take out home or life insurance as well.
Buyer Advisory Fee
A buyers’ advisor can assist you with the entire purchase process. From finding the perfect property to negotiating the price, reviewing the legal contracts, undertaking due diligence,support with mortgage broking and visa applications and looking after the administration of the whole purchase process. Allow for 3% of the property purchase price +VAT for buyer advisory services.