Why taxes and legal steps matter
Buying a home in Spain is exciting, but many foreign buyers are surprised by the extra costs and paperwork involved. If you’re from the UK, the Netherlands, or elsewhere in Europe, it’s important to understand the legal process and property taxes in Spain before you sign anything.
Here’s a clear breakdown of what expats need to know.
🏛️ Step 1: Get your NIE (Número de Identidad de Extranjero)
- Required for all foreigners buying property.
- Issued by Spanish police or consulate.
- Needed to pay taxes, open a bank account, and sign at the notary.
💶 Step 2: Understand the main property taxes
- ITP (Impuesto de Transmisiones Patrimoniales)
- For resale properties.
- Usually 10% of the purchase price in the Valencian Community.
- IVA (Value Added Tax)
- For new-build properties.
- 10% VAT + 1.5% Stamp Duty (AJD).
- Notary and Land Registry fees
- Around 1–2% of the purchase price.
- Lawyer fees
- Usually 1% of the purchase price, worth every euro for peace of mind.
📑 Step 3: The legal process
- Reservation contract – small deposit (€3,000–6,000) to take property off the market.
- Private purchase contract (Contrato de Arras) – usually 10% deposit, sets timeline for completion.
- Notary signing – final payment, deed signed, property officially yours.
- Registration – property recorded in your name at the Land Registry.
⚠️ Common mistakes to avoid
- Not checking if the property has debts (community fees, mortgages, utilities).
- Relying only on the seller’s agent.
- Forgetting ongoing taxes (IBI – local property tax, €200–800/year depending on size).
- Not budgeting for annual non-resident tax if you don’t live in Spain full-time.
🌍 Why expats choose Sunny Spain Realty
- Independent buyer representation (we work for you, not the seller).
- Negotiation to lower purchase price.
- Coordination with trusted lawyers and notaries.
- Clear breakdown of all costs upfront, so there are no surprises.
✨ Conclusion
Buying property in Spain is safe and rewarding—if you understand the taxes and legal process. With the right support, you can avoid mistakes, save money, and enjoy your new life in Spain stress-free.
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