Costs and taxes when buying a home

Buying a home is one of the most important financial decisions a person can make in their life. However, in addition to the purchase price, it is essential to take into account the costs and taxes associated with this transaction in Spain. There are numerous expenses and taxes that must be considered when formalising the transaction and becoming an owner. We explain what the taxes and expenses are when buying a property.

These expenses include the valuation of the property, notary fees, registry costs and the corresponding taxes (such as VAT and ITP). Experts recommend having savings equivalent to 10% or 12% of the price of the property, depending on the autonomous community, to meet these compulsory expenses. The total amount to be paid will depend on whether the property is new or used, as well as its value. Below, we will summarise each of these concepts.

The costs of buying a home: the buying and selling process

Notary fees

When purchasing a property, whether new or used, it is important to consider the expense related to the notary’s office. Notary fees, known as tariffs, are regulated by the state and are uniform for identical services. In the case of the public deed of sale, prices vary between 600 and 875 euros, depending on the value of the property. For example, for a flat worth 100,000 euros, the fees would be approximately 850 euros.

Land Registry

There is also a cost associated with registering the deeds that have been signed before the notary in the land registry. Again, these fees are set by regulation and vary directly according to the price of the property, although they generally range between 400 and 650 euros.


The buyer of a property must also have an additional fund to cover taxes, although these will vary according to the price of the property and whether it is new or second-hand, which determine the costs when buying a property.

In the case of the purchase of a new home, the most significant tax is VAT, which in 2023 stands at 10% in all of Spain except the Canary Islands. This means that it would represent 10,000 euros for a 100,000 euro property and 25,000 euros for a 250,000 euro property. However, in the Canary Islands the IGIC (Impuesto General Indirecto Canario) is applied, which has a tax rate of 6.5%. It is important to note that in the case of social housing, VAT can be 4%, although this varies according to the autonomous community and the type of social housing in question.

In addition to VAT, a second tax must be added: the Stamp Duty (Impuesto de Actos Jurídicos Documentados, IAJD). This tax remains the responsibility of the buyer and its amount will depend on each autonomous community.

On the other hand, in the case of second-hand properties, the most relevant tax is the Transfer Tax (ITP). The amount to be paid will depend on the percentage applied to the price established in the deed and on the autonomous community in which the property is located, although in general a tax rate of between 6% and 10% is applied.

Here you have the ITP according to the autonomous community:

Andalusia 7% Aragon 8% Asturias 8% Balearic Islands 8% Canary Islands
Asturias 8% Balearic (Islands) 8% Canary (Islands) 6.5% Cantabria 10% Castilla La Mancha 9% Castilla y León 8% Cataluña 10% Cantabria 10% Castilla La Mancha 9% Castilla y León 8% Cataluña 10% Cantabria

Castile La Mancha 9% Castile and Leon 8% Catalonia 10% Ceuta 6% Ceuta 6% Ceuta 6% Ceuta 6% Ceuta
Ceuta 6% Community of Madrid 6% Community of Valencia

Community of Madrid 6% Community of Valencia 10% Extremadura 8% Extremadura 8% Galicia 9% Galicia 9% Valencia 9% Extremadura
Galicia 9% La Rioja 7% Melilla

La Rioja 7% Melilla 6% Murcia 8% Navarra 6% Basque Country 7%

It is important to mention that in the case of subsidised housing (VPO), large families, people with disabilities and young people, reduced tax rates are generally applied. For example, in Madrid, large families who purchase a market property will pay a 4% transfer tax (ITP) on the price established in the deed, as long as the property purchased is intended as their habitual residence.


The contracting of an agency is an optional expense when buying and selling a property. This entity is responsible for processing the settlement of taxes and carrying out other administrative procedures. As they are independent professionals, there are no established fees and they are usually contracted mainly when applying for a mortgage for the purchase of the property. The approximate cost of a gestoría is around 300 euros, which is in addition to the costs of buying a property.

Mortgage costs

In case the buyer decides to acquire the property, whether new or used, through a mortgage loan, it is important to bear in mind that there will be some additional costs apart from those related to the purchase and sale.

Valuation of the property

If the buyer decides to apply for a mortgage, he or she must pay for the services of an appraiser to determine the value of the property and allow the bank to determine the percentage of financing it can provide. In general, financial institutions usually lend up to 80 per cent of the purchase price or appraised value, although some may finance up to 90-100 per cent of the purchase price, usually choosing the lower value. In 2023, the cost of the appraisal ranges between 250 and 600 euros, depending on the appraiser, the type of property and its valuation. The appraisal is valid for 6 months from the date of issue.

Since the entry into force of the new Mortgage Law in June 2019, the rest of the expenses, such as notary fees, registration and Stamp Duty (AJD), are assumed by the bank.

Opening commission

The origination fee can be up to 2% of the borrowed capital, depending on the agreement with the financial institution. This amount is deducted directly from the amount given to the borrower. However, it is important to mention that many banks do not apply this penalty, which does not always affect the costs when buying a home.

Stamp Duty Tax

This tax is payable when a notarial deed is executed, which subsequently has to be entered in the register and has an associated financial amount. As of November 2018, a decree law came into force that establishes the liability of banks to pay this tax.


The expenses when buying a home related to the notary are generated by the formalisation of the public deed of the mortgage loan. Since June 2019, these expenses are assumed by the entity.

Land Registry

There is also a cost involved in registering deeds that have been executed before the notary. Again, the fees are set by regulations. From June 2019, these costs are borne by the entity.


The bank that grants the mortgage selects an agency to perform the administrative tasks and carry out the corresponding procedures. From June 2019, these costs are assumed by the entity. In addition, the agency must reimburse the borrower for any excess money, deliver the invoices and deeds after paying the notary and registry fees that are not covered by the financial entity. It is important to remember that the Stamp Duty (AJD) is paid by the bank.

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