The costs associated with buying a property in Spain: What you need to know before acquiring your new home

Before embarking on the purchase of a property in Spain, it is essential to understand the costs associated with this transaction. Spain imposes a series of taxes and fees that can have a significant impact on the total cost of purchase. In fact, according to estimates, the costs associated with buying a property in Spain can represent up to 13% of the total purchase price.

This proportion may seem high, but it is important to understand that these costs include various elements, such as VAT, notary fees, property taxes, and other administrative expenses. By understanding these costs and planning for them in advance, buyers can avoid financial surprises and ensure that their budget is in line with their expectations.

We will examine in detail each element of the costs associated with buying a property in Spain, providing clear explanations of what to expect at each stage of the process. Whether you are considering buying a new property or a resale property, understanding these costs is essential for making informed decisions and ensuring a smooth real estate transaction.

1. Taxes:

• VAT (Value Added Tax): For new properties, VAT is currently set at 10% in 2023, or
• ITP (Property Transfer Tax): For second-hand properties, ITP generally ranges between 6% and 10% depending on the autonomous community.

2. Registration, Notary, Cadastre, and AJD:

• Property Registration: Fees associated with registering documents signed before the notary, usually between 400 and 700 euros.
• Notary: Notary fees for drafting contracts, regulated by the State and variable depending on the property price.
• Cadastre: Fees for registering documents signed before the notary, also regulated and dependent on the property price.
• AJD (Tax on Documented Legal Acts): Tax applicable to the purchase of new properties, with the amount varying by region, usually between 1% and 1.5% of the purchase price.

3. Management or Lawyer:

• Administrative Management: Fees for the services of a management firm, which can assist with tax filings and other administrative formalities.
• Lawyer: Some buyers choose to hire a lawyer to advise them throughout the property purchase process in Spain.

By understanding these different costs in detail, you will be better prepared to handle the expenses associated with buying a property in Spain. Keep in mind that the amounts may vary depending on various factors, so it is recommended to consult with a professional to get advice tailored to your specific situation.