How Much Does It Cost to Buy a Property in Spain in 2024?

How Much Does It Cost to Buy a Property in Spain in 2024?

Space Real Estate
 
What are the purchasing costs in Spain?
 
When buying a property in Spain, several additional costs come must be paid on top of  the purchase price. 
 
These include taxes, legal fees, and other charges. 
 
 
Closing Costs -
 
Transfer Tax (ITP): This is the Spanish equivalent of stamp duty and ranges from 6.5% to 10% of the purchase price, depending on the region. For instance, in Andalucia it’s 7%,in Valencia and Catalonia, it’s 10%, and Murcia 8%. 
 
Notary Fees: Typically around 1% of the purchase price.
 
Legal Fees: Usually 1% of the purchase price plus VAT, with a minimum charge often ranging between €1,000 to €2,000. 
 
VAT on New Builds: For new-build properties, expect to pay 10% VAT and 1.5% stamp duty.
 
Generally we will advise to budgetl 10-14% of the purchase price to cover these costs, although this can vary by region and financing options. 
 
 
 
Ongoing Costs when you own a property in Spain -
 
 
Taxes and Fees, once you own a property in Spain, ongoing costs are relatively low compared to other parts of the world, particularly when it comes to property taxes. 
 
Annual Property Taxes- Locally known as SUMA in the Alicante area or IBI in Andalucia, this is the equivalent to council tax, this is paid annually to the local town hall. The amount varies based on the property’s location and rateable value. In some areas, this may also include refuse collection (basura). 
 
Community Fees- If your property is part of a resort or urbanization, you’ll need to pay community fees for the upkeep of communal areas like swimming pools, gardens, and lifts. Fees can vary significantly, especially in developments with amenities like golf courses or spas.
 
 
Cost of Living in Spain 
 
Despite inflation affecting much of Europe, Spain remains a cost-effective option.
 
Utilities bills, these will include your water, electricity and gas. These will of course be based on your usage, generally per month you would expect to spend €100 on electricy and €50 on water.
 
Internet and telephoneacombined landline, broadband, and mobile phone package might cost about €50 per month
 
 
 
Income Tax Considerations for Spanish Property Owners
 
If you own a holiday home in Spain, you’ll be subject to non-resident income tax, even if you don’t rent out the property. This tax is based on the property’s rateable value (valor catastral). The tax rate is 1.1% of the rateable value, taxed at 19%. If you decide to rent out your property, the income is taxed at 24% for non EU passport holder with no deductions permitted, for EU passport holders the tax is 19% with deductons allowed.
 
 
Buying a home in Spain offers a combination of affordable living and relatively low ownership costs, making it an attractive option for buyers in 2024. However, it’s crucial to budget for all the associated costs—both upfront and ongoing—to ensure a smooth and financially sound investment.