The True Cost of Buying Property in Spain: Taxes, Fees and What to Budget

Buying property in Spain typically costs 10-12% more than the advertised purchase price for resale properties, and around 12-14% more for new builds. Why? Because the advertised housing price doesn’t include taxes, legal fees, notary costs and registration – something all buyers need to know before setting their budget.

Most UK buyers underestimate the additional costs. The Spanish system is structurally different from the UK, and if you have only ever bought property in England, the additional costs here may come as a surprise. The experts at Bromley Estates understand every step of the property-buying process in Marbella, so they’ve broken down every step for you, as well as provided guidance on what each expense covers.

If you’re ready to understand what happens after you find a property, our step-by-step buying process in Spain covers the reservation contract, due diligence, private purchase contract and completion in full detail.

Why are buying costs in Spain higher?

In the UK, property purchases involve stamp duty, solicitor fees and survey costs. In Spain, taxes are split between central and regional government, meaning the rate you pay depends on where in Spain you buy and whether the property is a new build or a resale.

Unfortunately, the answer to “how much extra will I pay?” is not a single number. It depends on the property type, the community it sits in and whether you’re taking out a mortgage.

For buyers looking at properties for sale in Marbella and the wider Costa del Sol region, the good news is that Andalusia has one of Spain’s most competitive tax frameworks. A 2021 reform simplified and reduced the region’s main resale property tax from a progressive 8-10% scale to a flat 7%, making it notably more attractive than regions like Catalonia or Valencia, where rates can reach 10%.

The type of property you buy is also key to determining the full cost. The two types of property purchase (new build or resale) are taxed differently, and understanding the split is essential when managing a budget.

New build vs resale tax implications

The most important rule in Spanish property tax is that ITP and VAT are mutually exclusive. You pay one or the other, but never both. The one you pay depends on whether the property is a new build or a resale.

Costs when buying a new build in Spain

When you buy a new-build property directly from a developer, you pay VAT (Impuesto sobre el Valor Añadido – IVA) rather than transfer tax. This is a national rate set by the central government.

VAT (IVA): 10% of the purchase price

This applies to all residential new-build properties across mainland Spain.

In addition to VAT, new-build buyers pay Stamp Duty:

Stamp Duty (Actos Jurídicos Documentados – AJD): 1.2% in Andalusia

AJD is levied on the notarised deed and applies only to new-build purchases. In Andalusia, the current rate is 1.2%. Other regions charge between 0.5% and 1.5%, so the rate varies if you are buying outside Andalusia.

Combined, VAT and AJD add approximately 11.2% in tax to the purchase price of a new-build property in Andalusia, before professional fees are added.

If you’re considering a new development on the Costa del Sol, you can browse our current new developments in Marbella and the Costa del Sol to see what is available.

One thing to consider: garage spaces and storage units (trasteros) sold with separate title deeds in new developments may be subject to VAT at 21% rather than 10%. This can add several thousand euros to the property’s advertised price. Always check whether parking and storage are included in the residential title or held separately.

Costs When Buying a Resale Property in Spain

When you buy a resale property, you pay ITP (Impuesto sobre Transmisiones Patrimoniales) – commonly referred to as Property Transfer Tax. VAT does not apply.

ITP in Andalusia: 7% flat rate

Andalusia currently applies a flat 7% rate on resale property purchases. This rate replaced a progressive scale of 8-10% in 2021, making the Costa del Sol one of the more cost-effective areas in Spain to buy a resale property.

For comparison, Catalonia and Valencia charge 10% ITP, and Madrid charges 6%. Andalusia, at 7%, sits in a competitive position for international buyers.

ITP is calculated on whichever is higher: the declared purchase price in the deed or the official cadastral reference value set by the Spanish land registry authority. Since 2022, this reference value system has made it harder to under-declare the purchase price, so buyers should always budget on the full market price paid.

A reduced ITP rate of 3.5% may apply in specific circumstances in Andalusia, for example, for certain first-time buyers or buyers with disabilities. These reduced rates apply to residents in Spain, not non-residents. If you believe you may qualify, discuss it with your Spanish lawyer before completing.

Legal and professional fees: What to budget beyond tax

Beyond the main purchase tax, a Spanish property purchase involves several professional fees, which are not optional. They’re part of the legal process of transferring ownership, and your budget should treat them as fixed costs.

Notary fees

All Spanish property purchases must be formally completed before a public notary (notario), who prepares and witnesses the signing of the title deed (escritura). Notary fees in Spain are regulated by the central government, which means all notaries charge the same rates for the same services.

The typical cost of a public notary is between €600 and €1,200, depending on the declared purchase price and complexity of the deed.

The notary’s role is to formalise the transaction. They do not advise either party, check for debts on the property, or act in the buyer’s interest. Your lawyer will arrange these steps.

Land Registry fees

After the deed is signed at the notary, the property must be registered in the Land Registry (Registro de la Propiedad). Until the property is registered in your name, you’re not legally the owner in the eyes of third parties, which creates major issues if you later want to sell, mortgage or rent the property.

The cost of registering the property is usually between €400 and €1,000, depending on the property value.

Legal fees

An independent Spanish lawyer is not a legal requirement for the purchase of property. For UK buyers purchasing in Spain, it is effectively essential because of the level of expertise required.

A Spanish conveyancing lawyer (abogado) will check for outstanding debts secured against the property, verify planning and urban development status, review the contract terms, handle the filing of ITP or VAT on your behalf, and manage the process through to completion. They act solely in your interest, unlike the notary, who is a state official.

The cost of a Spanish lawyer is approximately 1% of the purchase price, plus Spanish VAT of 21%.

On a €400,000 property, you can expect to pay around €4,000 to €4,840 in legal fees, including VAT.

Gestor fees

A gestor is a professional who coordinates the submission of documents to the tax authority, liaises with the Land Registry, and manages the administrative paperwork between notary, bank and buyer. Your lawyer often handles this role, but on some transactions, a separate gestor is required.

The cost of a gestor is usually between €300 and €500.

Bank transfer and currency costs

For UK buyers, one cost that rarely appears in guides is the conversion of GBP to EUR for a large purchase. High street bank exchange rates and international transfer fees can add a meaningful sum to the total spend.

On a €400,000 purchase, a 1% difference in the exchange rate versus the mid-market rate represents €4,000. Using a currency specialist rather than a bank for the transfer can reduce this cost significantly.

The NIE: A non-negotiable first step

Before you can sign any property deed in Spain, you need an NIE (Número de Identificación de Extranjero). This is a Spanish tax identification number issued to foreign nationals, and without it, the transaction cannot proceed at the notary.

For UK buyers, an NIE can be obtained through the Spanish Consulate in the UK before you travel, or in person at a Spanish police station (comisaría) with the appropriate documents. The process can take several weeks if done from the UK, so it’s worth starting early.

What does it cost to buy in Marbella?

To make this concrete, here are two realistic scenarios based on the current Costa del Sol property market. These figures are estimates based on current typical costs. Your lawyer will provide a precise breakdown specific to your transaction before you commit to anything.

Scenario A: €400,000 resale apartment in Marbella

Additional costs as a percentage of the purchase price are approximately 8.7%.

Andalusia’s flat 7% ITP sits below the Spain-wide average, which is why this scenario comes in at the lower end of the typical 10-12% national range. Buyers purchasing in regions with higher ITP rates (like the 10% in Valencia or Catalonia) would face significantly higher totals for the same property price.

Scenario B: €500,000 new-build villa off-plan in Costa del Sol

Additional costs as a percentage of purchase price are approximately 12.9%.

These two scenarios illustrate the difference between buying resale and new build. The new-build in Scenario B costs roughly €29,000 more in additional costs than the resale apartment in Scenario A, despite the purchase price being only €100,000 higher. That gap is almost entirely driven by VAT replacing the lower ITP rate.

Ongoing costs to consider

While the purchase price of a Spanish property is a one-off, owning property in Spain carries annual costs that should also form part of your budget.

IBI (Impuesto sobre Bienes Inmuebles) – annual property tax

IBI is the Spanish equivalent of council tax, and is charged by the local municipality based on the cadastral value of the property.

The typical rate of IBI is between 0.4 and 1.1% of cadastral value per year. Your lawyer will confirm the current IBI figure as part of due diligence.

Community fees

If the property resides within a gated development, monthly community fees will likely apply. These cover maintenance of shared areas, pools, gardens, lifts and security.

These typically range between €50 to €200 per month, but premium developments with extensive facilities can be higher.

Non-resident income tax (IRNR)

Even if you don’t rent out the property, Spain taxes non-resident property owners on a notional imputed income each year. For EU residents, the rate is 19% of 1.1% of the cadastral value. For non-EU residents, including UK nationals post-Brexit, the rate is 24%.

As a rough indication: on a property with a cadastral value of €200,000, the annual IRNR bill for a UK buyer would be approximately €528.

This is an area where specialist tax advice is essential. This guide is intended as a general overview. You should speak to a qualified Spanish tax adviser before purchasing property.

Organising your finances before you buy

A few points worth considering before you make an offer on a Marbella property.

Spanish mortgages for non-residents

Spanish banks can lend up to 70% of the property value for non-resident buyers, compared to up to 80% for Spanish residents. A UK buyer purchasing a €400,000 property would need a minimum of €120,000 in cash for the deposit, plus the full amount of all taxes and fees on top, since purchase costs cannot be added to a mortgage.

Budget carefully. Your deposit, plus all purchase costs, must be available in full before you reach the notary.

Confirm your legal team early

Don’t wait until you find a property to appoint a lawyer. Having a conveyancing lawyer in place before you start searching means you can act quickly when the right property comes up, and your lawyer can advise on any contract before you sign a reservation.

If you’re ready to commence your search for a dream property in the Costa del Sol, we can help you. Get in touch with the team at Bromley Estates to get the ball rolling on your new life on the Spanish south coast.