If you're planning to buy a property in Spain in 2025, it's crucial to be aware of the various costs and taxes involved. Navigating these additional expenses can be daunting, especially if you are an expat moving to Spain for the first time. This guide breaks down the costs and fees to help you better prepare for your property purchase in Spain.
Initial Considerations
Before delving into the specifics of buying property in Spain, it's important to note that a mortgage is not the sole financial commitment you will encounter. Spanish banks typically finance up to 80% of the property's value if it will be your primary residence. This means you'll need to have at least 20% of the property value saved for the deposit. Additionally, you must consider other expenses such as taxes, notary fees, and various administrative and legal costs.
Primary Costs
The total expenses related to buying a property in Spain, excluding the deposit, typically amount to between 10% and 12% of the property's purchase price. These figures include various compulsory fees, regardless of whether the property is new or pre-owned. Here are the primary expenses you'll need to account for:
Notary Fees
In Spain, notaries perform the role that solicitors ordinarily handle in the UK when a property is bought. Their fees are regulated by the state and vary depending on the property's price. For instance, notary fees can range from €600 to €875, but the cost for a €250,000 property might be around €1,000.
Land Registry Fees
Registering the property deeds signed by the notary also incurs a cost, which is governed by Spanish regulations. These fees are generally between €400 and €700, depending on the property's price.
Taxation
Taxes are a significant part of the cost of purchasing property in Spain, and the types and amounts depend on whether the property is new or pre-owned.
New Properties:
- VAT (IVA - Impuesto sobre el Valor Añadido): For new-build homes, you will have to pay a VAT of 10% of the property price. In the Canary Islands, this tax, known as IGIC (Indirect General Canary Islands Tax), is reduced to 7%.
- Stamp Duty (AJD - Actos Jurídicos Documentados): This is an additional tax on new properties, which varies by region. For instance, it ranges from 0.5% to 1.5% of the property price.
Pre-owned Properties:
- Property Transfer Tax (ITP - Impuesto sobre Transmisiones Patrimoniales): This tax is payable on the purchase of pre-owned homes. Rates vary from 4% to 10%, depending on the autonomous community. For example, in Ceuta and Melilla, the rate is 6%, while it can be as high as 10% in regions like Catalonia and Valencia.
Regional Tax Rates: New Property Purchases (2025):
| Autonomous Community |
AJD |
VAT |
| Andalucía |
1.2% |
10% |
| Aragón |
1.5% |
10% |
| Asturias |
1.2% |
10% |
| The Balearic Islands |
1.2% |
10% |
| The Canary Islands |
1.0% |
7% |
| Cantabria |
1.5% |
10% |
| Castile-La Mancha |
1.5% |
10% |
| Castile and Leon |
1.5% |
10% |
| Ceuta |
0.5% |
10% |
| Madrid |
0.75% |
10% |
| Valencia |
1.5% |
10% |
| La Rioja |
1.0% |
10% |
| Melilla |
0.5% |
10% |
| Murcia |
1.5% |
10% |
| Navarre |
0.5% |
10% |
| The Basque Country |
0.5% |
10% |
Regional Tax Rates: Pre-owned Property Purchases (2025):
| Autonomous Community |
ITP |
| Andalucía |
7% |
| Aragón |
8% |
| Asturias |
8% |
| The Balearic Islands |
8% |
| The Canary Islands |
6.5% |
| Cantabria |
10% |
| Castile-La Mancha |
9% |
| Castile and Leon |
8% |
| Ceuta |
6% |
| Madrid |
6% |
| Valencia |
10% |
| La Rioja |
7% |
| Melilla |
6% |
| Murcia |
8% |
| Navarre |
6% |
| The Basque Country |
4% |
For certain groups, such as large families, individuals with disabilities, and young buyers, there could be reduced tax rates. For instance, in Madrid, families with three or more children may only pay 4% property tax if they buy a new home as their primary residence.
Additional Costs
Adviser Costs:
Hiring a 'gestor' (an administrative adviser) can be beneficial, especially if you don't speak Spanish. These advisers can help with tax settlements and paperwork. This service usually costs around €300.
Mortgage-Related Costs:
If you need to take out a mortgage, you should be aware of potential additional expenses:
- Property Valuation: Required for obtaining a mortgage; this service can cost between €250 and €600. Some banks may cover this cost.
- Mortgage Opening Fee: Some banks may charge an opening fee, which could be up to 2% of the loan amount, though many banks nowadays do not apply this charge.
Buying a property in Spain involves several additional costs and taxes beyond the property's sale price. Understanding these expenses is crucial to avoid any unexpected financial burdens. Always consult with local professionals to get accurate, tailored advice based on your specific circumstances.
By planning ahead and budgeting for these essential costs, you can enjoy a smoother process as you embark on this exciting journey of purchasing your new home in Spain.