Apart from the emotional aspect when buying a house abroad, we must take into consideration the legal aspects involved in the process, as it might not be the same if a couple is buying, their sons/daughters, a company…or if we buy something new or second hand. In all the cases, one thing is clear, there would be some taxes involved. One of our tasks apart from finding your dream house, is to provide you with the more accurate information related to this aspect as well.
In general terms, the Spanish Administration is charging the buyer a 10% tax applied on the sales Price, as VAT tax for new built or ITP tax if it is second hand. Apart from this tax, conveyance costs (Notary, Register, supply companies…) can be estimated at a about 2,5% for second hand properties and 3,5% for new built as other taxes are involved in this process as well. This means that you should consider an extra cost of around 12,5-13,5% on top of the sales price for the property you choose.
Foreign citizens buying a property in Spain must obtain a NIE (fiscal identification number) prior to their purchase. It is also necessary to have a Spanish bank account to debit supply contracts, expenses and other fees. This bank account must be operational before the purchase in case of buying second hand properties or if you plan on getting a mortgage in Spain. This is not the case of new built properties though.
Generally speaking the annual costs of having a property in Spain include the following: yearly property council tax, garbage and rubbish collection local fee, non resident yearly income tax, supply contracts fees, community costs (if any) and mortgage cost (if any). In most of the areas this can be covered with around 1500 to 1800€/ year.