The costs of buying a home, without the small print
The excitement of buying a new home, whether a long-term residence or a favourite holiday retreat, is usually accompanied by concern about the financial commitment.
Normalmente en las inmobiliarias vemos anuncios que ofertan casas a determinados precios, pero ¿este precio corresponde con el dinero que se va a tener que pagar el comprador?
The answer is no, since there are several additional expenses that are not usually indicated, because it is assumed that the buyer knows all these costs (error).
In Dream Sun Spain We are aware that not everyone has to know the additional costs involved in the acquisition of a property, therefore:
We explain below all the costs involved in the purchase of a house:
– Precio de Compra: This is the advertised sale price, before taxes or fees. It is the amount stated in the reservation contract and the notarised deed of sale, payable to the seller.
– Estate agency fees: The agency charges a fee for its marketing and advisory work. Depending on the agency and location, this may be paid by the seller, buyer or shared. Always clarify who pays and whether it adds to your purchase costs.
Taxes: The purchase of a house always carries a tax that is called ITP or Property Transfer Tax, a tax whose percentage is set by each autonomous community. The rate in the Valencian Community is 10% of the purchase price. If buying a new-build home directly from the developer or builder, the applicable tax is VAT, instead of the ITP, and which is also paid 10%, but in this purchase made with VAT there is an additional 1.5% tax called Stamp Duty (Actos Jurídicos Documentados) and that many times you forget to calculate it.
– Notary and Land Registry fees: These costs are generally paid by the buyer, although the reservation or deposit contract can agree a different split with the seller. As an approximate guide, on a €200,000 home allow approximately €1,000 in notary fees and €500 in Land Registry fees.
– Legal Advice Costs: No esta de mas y es muy recomendable siempre contar con el asesoramiento de un asesor fiscal o abogado para que revise y redacte todos los documentos y nos guie en el proceso de compra, para evitar problemas. El coste depende del profesional a que se contrate, pero puede estar sobre un 1% del valor de la compra.
– Municipal capital gains tax (plusvalía municipal): by law, this is payable by the seller unless the deposit contract provides otherwise. An exception requires the buyer to pay when the seller is foreign or not resident in Spain.
Connecting or transferring utilities: After the purchase you have to change or activate (if not available) the water supplies, electricity, internet, etc. This may amount to an additional cost depending on the population and the existing supply contracts.
And finally, costs that are not proper to the purchase, but if they are costs to dispose of the housing as the Homeowners' association charges, the Property tax, refuse collection charges and other expenses.
A good real estate agency will inform you of all these details so that the purchase process is the most rewarding possible.
In Dream Sun Spainwe are committed to keeping the illusion of our customers and that is why we always report clearly of all these details, so that they make the right purchase decision and adapted to their tastes and needs.
If you have any doubts about this article or need advice, contact us without obligation.
