Costs of Buying a Property in Spain

Costs of Buying a Property in Spain

Before you decide to buy a property in Spain, you ought to know exactly what costs are involved, so you can work out what would be a reasonable purchase price, according to your budget.

In general, you will need to allow between 10% and 14% of the purchase price for the expenses.

Although it will be helpful to see a couple of examples in detail, you need to know that the most relevant purchase cost is the transfer tax, recently reduced to 7% flat (for properties in Andalusia). If you buy a brand new property directly from a developer, you will not pay the Transfer Tax, but a 10% VAT + 1,2% Stamp Duty, so the total tax will be 11,2%.

Let’s see three samples for property purchases, with a full breakdown of all the costs involved:

SAMPLE 1. Resale apartment in Andalucia with a purchase price of 320,000,00 Euros

• 7% Transfer Tax:…………………22.400,000
• Lawyers fees (1% + VAT)……….3.872,00
• Notary Fees:…………………………1.400,00
• Land Registry Fees………………….600,00
• Home Insurance………………………350,00
• Various (bank charges, etc)……….378,00
• TOTAL…………………………………29.000,00  Euros

SAMPLE 2 Brand new apartment in Andalucia) with a purchase price of 320.000,00 Euros

• 10% VAT…………………………….32.000,00
• 1,2% Stamp Duty…………………..3.840,00
• Lawyers fees (1% + VAT)……….3.872,00
• Notary Fees:…………………………1.600,00
• Land Registry Fees………………….700,00
• Home Insurance………………………350,00
• Various (bank charges, etc)……….138,00
• TOTAL………………………………..42.500,00  Euros

SAMPLE 3. Resale VILLA in MARBELLA (Andalucia) with a purchase price of 3.000.000 Euros

• 7% Transfer Tax:…………………210.000,00
• Lawyers fees (1% + VAT)………..36.00,00
• Notary Fees:………………………….6.000,00
• Land Registry Fees………………..4.000,00
• Home Insurance…………………….4.000,00
• Various (bank charges, etc)……10.000,00
• TOTAL………………………………279.000,00  Euros

Other possible costs related with the purchase of your property in Spain, will be the initial fees for the water and electricity supply contracts. This depends of the type of property and the supplier company. Sometimes, before you are able to arrange these contracts, you may be requested to carry out some modifications to the electricity and water installations in order to comply with new regulations, especially if the property is quite old. This can be quite expensive for older properties. In some occasions, it might be convenient to have a survey made on the property, which may cost between 500 and 3.000 Euros depending of th characnteristics of the property.

If you are buying with a mortgage,  you will need to add some costs (life insurance, property valuation, etc..). Please ask your bank about this.

Finally, if you are thinking in buying a property in Spain, please enjoy reading this