When purchasing property in Spain, buyers should be aware of several fees and taxes that will significantly impact the total cost of the investment. Understanding these costs upfront is crucial for effective budgeting and avoiding unexpected financial surprises.
1. Property Transfer Tax (Impuesto de Transmisiones Patrimoniales – ITP): This is a primary tax for resale properties. Rates vary by region but generally range from 6% to 10% of the property’s purchase price.
2. Value Added Tax (IVA) and Stamp Duty (AJD): For new properties, instead of ITP, buyers pay IVA at a rate of 10% for residential properties. Additionally, there is a stamp duty (AJD) ranging from 0.5% to 1.5%, depending on the region.
3. Notary Fees:** These fees are mandatory for the formalisation of the sale and typically range between 0.5% and 1% of the property price. The exact amount depends on the complexity and the value of the transaction.
4. Land Registry Fees: After notarization, the sale must be registered in the Land Registry. Fees for this service generally range from 0.1% to 0.5% of the purchase price.
5. By Legal Fees: Hiring a lawyer is highly recommended to handle the transaction’s legal aspects, ensure due diligence, and protect the buyer’s interests. Legal fees usually range from 1% to 2% of the purchase price.
6. Mortgage Costs: If the purchase is financed with a mortgage, additional costs include valuation fees (approximately €300-€600), arrangement fees (around 1% of the loan amount), and mortgage stamp duty (0.5% to 1.5% of the loan amount).
7. Additional Costs: Other potential costs include survey fees, if you opt for an independent property survey, which can add several hundred euros to your expenses.
In summary, when buying property in Spain, buyers should expect to pay an additional 10% to 15% of the property price in fees and taxes. Proper planning and budgeting for these costs are essential for a smooth purchasing process. Consulting with local real estate experts and legal advisors can provide tailored guidance and help navigate the complexities of the Spanish property market.
If you are looking to buy a property in Spain and need a mortgage, email mark@vci-network.com for the latest criteria