All property prices you see, whether in brochures, online, or anywhere else, are net prices for the seller. Purchase tax and associated costs must be calculated in addition to the agreed-upon price with the seller.
The main difference lies in buying new property from a developer or a used property.
Properties bought from developers are subject to Value Added Tax (VAT) at 10% and a stamp duty of 1.2% on top of the purchase price. VAT must be paid on the day of the notarial deed.
Used properties are subject only to a transfer tax of 7%. However, this percentage can vary. The transfer tax can be paid within 30 days of the notarial deed.
Currently, we can already see a significant difference in taxes when buying from developers or private individuals living in homes. For a purchase of 2 million euros, the difference is exactly 100,000 euros!
It’s worth clarifying that private individuals can sometimes be registered as developers and sell property with VAT. The key to determining whether a property is subject to VAT is whether it’s new or completely refurbished. If no one has lived in it, and the owner is registered as a developer, VAT applies.
Lastly, we would like to add a note about purchasing Spanish companies that own a single asset, i.e., property. It’s a common misconception that when you buy shares in a Spanish company, there are no transfer taxes. When buying shares in a Spanish company, taxes may or may not apply, but they always do when it’s an active business. The law states that if you buy a company that owns only one asset, a property, and does not engage in any business activity or employ workers, the transaction is treated as the purchase of the property itself. Therefore, the same taxes that apply to property purchases are applicable. The tax authority has a straightforward way of identifying when such companies change ownership.
WHAT OTHER COSTS ARE INCURRED WHEN BUYING PROPERTY IN MARBELLA, SPAIN?
The rest of the costs are the same for both new and used properties and include:
Legal fees for property purchase in Marbella
Legal fees amount to 1% (+VAT) of the purchase price for straightforward transactions. If the purchase involves a higher amount or you are a repeat client, some law firms may slightly adjust their fees. Sometimes, clients prefer not to use a lawyer to reduce the costs of buying property in Marbella, as it is not mandatory to use a lawyer. We strongly recommend always using a lawyer. A good lawyer not only handles the transaction but also conducts a thorough legal analysis before the purchase and provides the necessary post-sale support.
Notarial and registration fees for property purchase
These fees depend on various factors and are usually estimated, with the final bill issued after the sale. We estimate it to be approximately 0.25% of the purchase price to be on the safe side. If the price exceeds 2 million euros, this percentage will be lower, closer to 0.15% or even 0.1%.
Banking fees when buying property
This pertains to transferring funds to the seller or issuing bank checks. Almost all notarial transactions are conducted using bank checks rather than transfers, and banks charge a fee for issuing these checks or making significant bank transfers. These fees can vary significantly depending on the payment amount, the bank used, and your customer profile. This is something to explore when opening a bank account in Marbella.
Fees related to mortgages when buying a house in Marbella
If you choose to buy property in Marbella with bank financing, you may be surprised to find that the only cost is the property appraisal. The cost of the appraisal ranges from €500 to +€2,000 depending on the size and value of the property. The rest of the costs and taxes are covered by the bank.
We hope this information helps you better understand the additional costs associated with property purchases in Marbella. If you have any further questions or need assistance with Spanish real estate, we are here to help. Thank you for your trust, and see you soon!
