Buying a home involves more than just the purchase price. At Buckingham Property Advisors, We want you to be fully informed about all the associated costs so that you can plan your investment properly.
Principal Taxes
VAT or ITP: Which one applies?
The tax you will pay depends on whether you buy a new or second-hand home:
New Housing (VAT):
- 10% of purchase price for primary residence
- 21% for second home or luxury home (over 450m²)
- Additional: AJD (Stamp Duty) between 0.5% and 1.5%
Second-hand housing (ITP):
- Varies according to the autonomous community
- Between 6% and 11% of purchase value
- Madrid: 6%
- Catalonia: 10%
- Andalusia: 7%
Notary and Registry fees
Notary
Costs regulated by official tariff:
- 100.000€ house: approximately 600-850€.
- 200.000€ house: approximately 850-1.200€.
- 500.000€ house: approximately 1.500-2.000€.
Land Registry
Similar to the notary fees, between 400€ and 1.500€ depending on the value of the property.
Administrative Expenses
Although optional, it is highly recommended. A gestoría is in charge of:
- Document processing
- Registration
- Tax settlement
- Typical cost: 300-600€.
Home Appraisal
Mandatory if you apply for a mortgage:
- Cost: 250-500€.
- Performed by official appraiser
- Valid for the bank
Mortgage Expenses (if applicable)
Opening: 0.5% - 1% of borrowed capital
Appraisal: 250-500€
Bank management: 300-600€
Home insurance: Mandatory, 200-500€ per year
Life insurance: Recommended, varies according to age and capital
Other Expenses to Consider
Municipal Capital Gains: In case of purchase from heirs or donation
Community of owners: Monthly fee if apartment or urbanization
IBI (Real Estate Tax): Annual, varies by municipality
Supplies: Water, electricity, gas
Moving and renovations: If necessary
Practical Example
For a second-hand home of 250.000€ in Madrid:
- ITP (6%): €15,000
- Notary fees: 900€.
- Registration: 700€.
- Agency: 450€.
- Total expenses: approximately €17,050 (6.8%)
If you also apply for a mortgage of 80% (200.000€):
- Opening (1%): 2.000€.
- Appraisal: 350€.
- Bank administration: €450
- Total additional: €2,800
- Grand total: 19,850 (7.9%)
Buckingham Councils
1. Budget the 10-12% of the purchase price for additional expenses
2. Compare mortgage offers - costs can vary significantly
3. Negotiate with the seller some minor expenses
4. Consultation with experts to optimize your tax situation
Our Integral Service
At Buckingham Property Advisors, we accompany you throughout the whole process:
- Personalized tax advice
- Accurate expense calculator
- Contact with trustworthy agencies
- Negotiation with banks
- Complete documentation management
Do you have any doubts about the purchase costs? Request a free consultation with our consultants and get a detailed breakdown for your specific case.