Costs to consider when buying property in Spain
Anyone who’s ever bought a house mutters to themselves about all the extra costs involved. We’d love to tell you that Spain is different, but it’s not. As a rule of thumb you should allow 10-12 per cent of the purchase price for all the costs involved with buying your Spanish home.
These include:
Fees
Legal fees are normally between 1 and 2 per cent of the purchase price plus Value Added Tax (IVA), currently at 16 per cent.
Notary fees are fixed by law and are based on a sliding scale depending on the amount of land and size of property. Fees usually amount to between 1 and 2 per cent of the declared value of the property.
Land Registry fees – to register the new owner at the Land Registry costs around 60% of the notary fees.
Taxes
Transfer tax (ITP) at 7 pr cent of the purchase price on resale properties. If you’re buying from a developer, this is replaced by Value Added Tax (IVA) at 7 per cent plus Stamp duty at 0.5 per cent.
Added value tax (‘Plusvalia’) – this is a land tax based on the increased value since the last sale. It’s normally payable by the seller but it can be stipulated that the buyer has to pay. That’s something for your lawyer to negotiate.
If you have a Spanish mortgage
Allow an additional 1 per cent for registering your mortgage and a 1 per cent arrangement fee.
Example costs for a property costing €250,000 (with no mortgage)
Purchase Price (includes agent’s fees) 250,000€
Legal Fees (1% of purchase price) 2,500€
Notary Fees (1% of purchase price) 2,500€
Land Registry Fees (60% of notary fees = 2,500€) 1,500€
Transfer Tax (7 per cent) 17,500€
Total payable 274,500€
For further information on buying and the costs in involved, get in touch with VIVA today!
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