We are often asked what the costs are for buying a property in Spain. When buying a Spanish property there are both costs for the buyer and for the seller. However, there are uncertainties about what costs are for the buyer and which are for the seller. We will list certain questions for you.
Notary fees / Escritura: Buyer
These are the cost of preparing the documents, the "Escritura".In general, Spanish law states that these costs should be distributed by the signing parties, meaning that the sellers should take care of the original costs of the deeds "Escritura". and the buyer for the copies. However, Nowadays it is normal that the buyer pays for all these costs. The notary fees are based on the selling price stated in the deeds of the property. As an example: you pay about 675€ for a property of 100.000 € for a property of 1 million euro you have to pay 1000 € to the notary.
Registration costs real estate: Buyer.
It is normally a standard fee also based on the selling price in the deeds. These costs may vary depending on the municipality you live in and in most cases, it is between 400 and 650 €.
Gestoría - Gestor Administration Office: Buyer
The Gestoría is like an accountant who handles tax payments and paperwork to formalize the deed of real estate and mortgages.
Solicitors can also handle all paperwork and normally charge around 1% of the selling price.
Property Transfer tax: Buyer
When buying a second-hand property, the buyer has to pay property transfer tax. For newly built properties, the buyer pays instead VAT or better said the IVA of 10%.
The property transfer tax is a tax that varies from region to region
In Valencia, Catalonia, and Galicia region, the property transfer tax is 10%.
In the Balearics, it is 8% for properties under 400.000 euros, 9% for properties between 400.000 and 600.000 euros and 10% for properties of more than 600.000 euros.
In Andalucía you pay between 8% and 10%, and in the Canary Islands 6.5%
Property valuation costs : Buyer
In case a buyer needs a mortgage, the bank has to make a valuation of the property. In this case, the buyer will pay around 800 /1000 € for this appraisal.
New construction: Buyer
When you buy a new house directly from the developer, you pay10% IVA (VAT) instead of paying the normal transfer tax. In addition, you also pay a tax on documented legal acts or Tax on documented legal acts (IAJD) in Spanish (Impuesto de Actos Jurídicos Documentados).
Agency Commission: Seller
If you sell real estate through a real estate agents, you must pay a commission. Estate agents usually ask about 6% commission in Spain. The seller may deduct the commission from the Agency from his joint tax on profits. As a salesperson, you may want to request the services that the agency offers. Good brokers also need the legal know-how to make contracts, request NIE numbers and after-sales services such as changing the energy bills and community costs to the new owner, for example.
Seller can offer the property to various Real estate Agents.
Sellers can advertise their property through various Real Estate Agents. Nevertheless, some agents will want to offer the seller to sell them through the agreement in order to request a smaller commission.
Income tax provision for non-residents - Rentención: Seller
If the seller is not a resident of Spain, he must pay in Spanish 3% income tax or Retención which goes directly to the tax office to cover any taxes arising from the sale. However, the seller can claim a refund if he considers that his tax is less than 3%.
Energy certificate: Seller
From 1 June 2013, according to Spanish law, all owners of real estate who want to sell or rent their property require an energy certificate. These certificates must be issued by a qualified certifier such as architects, surveyors or technical house engineers. The costs for such a certificate may vary depending on the size of the property and may be between 100 and 500 €. The invoice for this certificate can also be deducted from the capital gains tax
municipal capital gains tax on the transfer of real estate Seller:
The plusvalía is a tax on the increase in the value of the land on which the property is located. This is paid to the local town hall. The plusvalía municipal is calculated on the basis of 3 factors:
The period of ownership, the location of the property and the cadastral ground value.
The plusvalía tax can easily be requested at the town hall where the property is located.
According to the law, plusvalía municipal - taxes are paid by the seller and it can be a considerable sum of money. Nevertheless, the plusvalía can be paid by the buyer if he has agreed to it..