The price agreed with the seller is never the final cost of a property in Spain. On top of it you will have to pay taxes, notary and registry fees and, if you need one, the costs linked to your mortgage. Knowing them in advance avoids unpleasant surprises on completion day and lets you prepare the funds you will need.
Resale properties: Transfer Tax (ITP)
When you buy a second-hand property from a private seller, the main tax is the Impuesto sobre Transmisiones Patrimoniales (ITP). In Andalusia the general rate is 7% of the purchase price, a single flat rate applied since 2021. Reduced rates exist for certain buyers and situations, such as young people or people with disabilities purchasing their main home, provided that the legal requirements and price limits are met.
New-build properties: VAT and stamp duty
If you buy a new home directly from the developer, you do not pay ITP. Instead, you pay VAT (IVA) at 10% on the price of the dwelling, together with up to two parking spaces and storage rooms sold with it, plus Stamp Duty (Actos Jurídicos Documentados, AJD) on the deed, which in Andalusia is generally 1.2%. Commercial premises, plots of land and garages bought separately are taxed at 21% VAT.
Notary and Land Registry
The title deed is signed before a Spanish notary and then registered at the Land Registry. Both fees are set by official tariffs and depend mainly on the price and the length of the deed. They are much lower than the taxes, but they must be included in your budget. Our purchase costs calculator gives you an indicative figure for your case.
If you need a mortgage
Since the Real Estate Credit Law (Law 5/2019), the bank pays the notary fees of the mortgage deed, its registration, the processing agency and the stamp duty on the mortgage. The buyer usually pays the property valuation and any copies of the deed they request. You can estimate your monthly payment with our mortgage simulator.
Buying from a non-resident seller
If the seller is not a tax resident in Spain, the buyer must withhold 3% of the price and pay it to the Spanish Tax Agency on the seller’s behalf, using form 211, within one month of the purchase. If this is not done, the property itself is liable for the unpaid amount, so it is an essential step that your lawyer should handle at completion.
Checks before you sign
- A recent nota simple from the Land Registry to confirm who owns the property and whether it has mortgages, seizures or other charges.
- Certificates showing that the property is up to date with the community fees and the municipal property tax (IBI).
- The town planning status of the property, its licences and, for rural properties in Andalusia, whether any irregular construction has been regularised.
- The energy performance certificate, which the seller must provide.
- A clear private purchase contract (reservation and deposit) that protects your money if the sale does not go ahead.
Costs after the purchase
Once you are the owner, remember the yearly costs: IBI, community fees, the municipal rubbish collection charge and, if you are not resident in Spain, the annual non-resident income tax on the property, even when it is not rented out.
How we can help
At Ramallo Abogados we give you a personalised breakdown of all purchase costs before you commit, check the legal status of the property, prepare the funds with you and can represent you with a Power of Attorney if you cannot travel to Spain. Contact us and tell us about the property you are interested in.
This article provides general information and reflects the rules in force when it was published. It is not legal advice: every case must be studied individually.
