Buying property in Spain - Overview and Guide
6th Jan 2025
The Spanish property market is showing dynamic growth, supported by strong economic fundamentals and low unemployment. A significant proportion of the population own their own property, but the rental market is also expanding. The low number of new-build dwellings points to a price rise, although prices are still lower than in 2007. For example, in 2023 the average price of a new dwelling was €3 437/m², compared to €1 981/m² for a second-hand dwelling. Barcelona stands out with prices well above the national average, making it one of the most expensive cities in Europe.
A favourable mortgage interest rate of 3.1% and flexible financing options make property purchase attractive, despite the challenge of land shortages and construction costs. The support of a local expert is essential to successfully navigate the property market.
When buying second-hand real estate, you will have to pay an Immovable Property Transfer Tax (Impuesto de Transmisiones Patrimoniales - ITP), which varies between 6-11% of the purchase price, depending on the region of the country where the property is located.
Administrative costs include lawyer's fees, which can amount to 1-1.5% of the purchase price, notary fees of 0.5-1% of the purchase price and a further 0.5-1% for the registration of the property in the Land Registry.
Real estate tax (Impuesto sobre Bienes Inmuebles - IBI) is due annually after the purchase and is 0.4-0.8% of the cadastral value of the property. If the owner is a non-resident of Spain and does not rent the property, he/she will also have to pay the non-resident income tax (Impuesto sobre la Renta de No Residentes - IRNR), which is 0.5% of the cadastral value. If rented, 24.75% of the net rent is taxed.
There are also common charges for the maintenance of the property, which vary for condominiums or apartment complexes depending on the services and facilities provided. Utility charges such as electricity, water and internet are broadly in line with prices in Hungary, but basic charges should also be taken into account.
Important questions to ask before deciding
Think about the lifestyle you want: a friendly expat community or full integration into the local culture? Your choice of property will be influenced by whether you are looking for a holiday home, an investment or a permanent home. An experienced agent can help you find the property that best suits your needs.
If you're ready to take the next step, visit different regions of Spain, familiarise yourself with the property market and contact a RE/MAX Go agent to get the property buying process off to a smooth start.
A favourable mortgage interest rate of 3.1% and flexible financing options make property purchase attractive, despite the challenge of land shortages and construction costs. The support of a local expert is essential to successfully navigate the property market.
Why choose Spain?
Spain not only offers a rich cultural heritage and fantastic gastronomy, but also boasts a high quality healthcare and education system. Its sunny beaches and vibrant cities offer the perfect location for all lifestyles, while there are no restrictions on foreigners buying property.Steps to buying
A trusted real estate agent, such as a member of the RE/MAX network, can help make the buying process stress-free. A good agent will not only help you overcome language barriers, but will also provide in-depth market knowledge to help you choose the right property and complete the necessary administrative steps. From obtaining an ID number to making an offer and paying a deposit, he or she will help you every step of the way. It's important to set your budget in advance so that the agent can help you find the property that best suits your needs and possibilities.Costs related to the purchase of real estate
When buying a property in Spain, there are a number of additional costs and taxes to consider in addition to the purchase price. For new build properties, you will have to pay VAT (VAT/IVA) of 10% of the purchase price, plus stamp duty (Actos Jurídicos Documentados - AJD) of 1-1.5%.When buying second-hand real estate, you will have to pay an Immovable Property Transfer Tax (Impuesto de Transmisiones Patrimoniales - ITP), which varies between 6-11% of the purchase price, depending on the region of the country where the property is located.
Administrative costs include lawyer's fees, which can amount to 1-1.5% of the purchase price, notary fees of 0.5-1% of the purchase price and a further 0.5-1% for the registration of the property in the Land Registry.
Real estate tax (Impuesto sobre Bienes Inmuebles - IBI) is due annually after the purchase and is 0.4-0.8% of the cadastral value of the property. If the owner is a non-resident of Spain and does not rent the property, he/she will also have to pay the non-resident income tax (Impuesto sobre la Renta de No Residentes - IRNR), which is 0.5% of the cadastral value. If rented, 24.75% of the net rent is taxed.
There are also common charges for the maintenance of the property, which vary for condominiums or apartment complexes depending on the services and facilities provided. Utility charges such as electricity, water and internet are broadly in line with prices in Hungary, but basic charges should also be taken into account.
Where should you buy?
Choosing the right location is key. Whether it's a tranquil seaside villa, a picturesque village or a modern city apartment, each region of Spain has its own unique atmosphere and opportunities. Barcelona and Madrid offer vibrant city life, while Bilbao or Seville offer unique cultural experiences.Important questions to ask before deciding
Think about the lifestyle you want: a friendly expat community or full integration into the local culture? Your choice of property will be influenced by whether you are looking for a holiday home, an investment or a permanent home. An experienced agent can help you find the property that best suits your needs.
If you're ready to take the next step, visit different regions of Spain, familiarise yourself with the property market and contact a RE/MAX Go agent to get the property buying process off to a smooth start.
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