Legal Process
We recommend you read and understand the following information and terms as they are of vital knowledge when thinking of purchasing property in Spain. There´s nothing more unpleasant than unexpected surprises, especially when your investment is concerned.
PROPERTY PURCHASE COSTS
You should normally allow 10% of the declared purchase price to cover costs and taxes.
This 10% is broken down as follows:
THE TRANSFER TAX
This makes up the bulk of this at 6% on a resale property.
If you purchase a new property from a developer you will pay 7% IVA (VAT) and 1½% stamp duty.
SOLICITORS
Price varies depending on the purchase price, but on a purchase of €60,000 - €120,000 fees are usually €600.
PROPERTY REGISTRATION FEES
Charged by the property registration office to inscribe the new deed into your name. Average cost between €120 and €300.
NOTARY CHARGES
These are set on a fixed scale by law and will be a minimum of €300 and may be much more depending on what is involved. (ie. mortgage)
WHO PAYS WHAT?
Spanish laws relating to Real Estate transactions stipulate that unless specified by contact taxes and fees are split between the buyer and seller as follows:
• Buyer Pays:
1. The transfer tax or IVA.
2. The fee that you are charged for registering at the property registry.
3. The Notary costs of the first copy and any further copies of the Escritura Publica.
• Seller Pays:
1. The Plus Valia Tax which is a municipal tax that is based on an officially assessed increase in the value since the previous transfer of property.
2. The Notary fees in drawing up the new Escritura Publica.
3. The fee to the Estate Agent who handles the sale.
