The advertised price is not the only cost to consider when buying a property in Spain. The transaction also involves taxes, notary fees, Land Registry fees, legal assistance and, when financing is required, certain mortgage-related expenses.
Taxes vary between Spain’s autonomous communities. This article explains the costs applicable in the Valencian Community and on the Costa Blanca, where buyers should generally reserve approximately 11% to 15% in addition to the purchase price.
New-Build Properties
When buying a new property directly from a developer, the main expenses are:
- Value Added Tax: 10% of the purchase price.
- Stamp Duty: 1.4% in the Valencian Community.
- Notary and Land Registry fees.
- Legal fees.
As a general guide, buying a new-build property without a mortgage may require approximately 13% to 15% in additional funds.
Resale Properties
VAT is not normally paid when buying a resale property. The main tax is Property Transfer Tax:
- 9% as the standard rate in the Valencian Community.
- Reduced rates are available for certain buyers and transactions that meet the legal requirements.
Notary fees, Land Registry fees and legal costs must also be considered.
The tax may be calculated using the property’s Cadastral reference value when it is higher than the purchase price or declared value. This should therefore be checked before signing the purchase deed.
As a general guide, buying a resale property without a mortgage may require approximately 10% to 12% in additional funds.
Buying With a Mortgage
When a mortgage is required, the buyer normally pays for the property valuation, any applicable arrangement fee and any linked products they choose to contract.
The bank covers the notary, Land Registry, tax and administrative fees associated with the mortgage deed. This does not include the taxes and expenses related to the property purchase itself.
Before Travelling to Buy a Property
Before you travel, Capital Union Investment will answer your questions, help you estimate the total budget required and prepare the necessary procedures with you.
We will guide you throughout the process so that you can search for and purchase your property on the Costa Blanca with clear information tailored to your circumstances.
The percentages stated are approximate and may vary depending on the property and the buyer’s circumstances. Before paying a reservation deposit or signing a contract, buyers should request an individual calculation and obtain legal and tax advice.
