When you buy a property in Spain, you will have to pay a number of costs over and above the actual purchase price. Generally speaking, you should allow 10–11% on top of the purchase price to cover all these costs.
Purchases of newly built residential properties are subject to a value added tax – Impuesto de Valor Añadido – in the amount of 10% of the purchase price. In addition to this, you will have to pay 1,2% in stamp duty.
Second-hand properties, on the other hand, are subject to a transfer tax – Impuesto de Transmisiones Patrimoniales – of 8-10% depending on region and price of the property. However, no stamp duty is payable.
Public Notary fees
The buyer is also responsible for paying the Public Notary’s fees when the partners exchange contracts. The actual cost can be difficult to calculate in advance as a range of different factors are involved. However, a reliable rule of thumb is that the fees will total around 0.5% of the purchase price.
Additional costs are linked to registration of the new owner in the property register. Again, it is difficult to state the exact cost in advance, but here, too, a good rule of thumb is 0.5% of the purchase price.
We would also like to remind you that when you take over a property, you will have to pay connection fees and/or duties linked to changing the name on the contracts for water and drains, electricity and gas, if appropriate.
Start up service
Even after you have officially taken over the property, there are still a number of practical issues to deal with, such as declaring and paying taxes and duties, registering the title or setting up electricity and water contracts. If you would like help with all this and more, we at The Real Estate Agency offer our start up serivce. This involves our dealing with all the practical matters so you can relax and enjoy your new home.
If you choose to take out a mortgage to finance a part of your property deal, then some other costs will apply. This means that instead of counting on 10–11% extra, you should allow 13% extra. Naturally, the exact sum may vary depending on the terms you negotiate with your bank.
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