The transfer tax when buying property in Spain
We are immersed in a difficult economic situation, which logically affects all elements of the country. The Spanish real estate market is also being affected by this situation, and we are witnessing a constant and generalized – although not yet pronounced – drop in the prices of the sale of homes.
One of the most important elements when buying a home is the expenses associated with it. One of them, and generally the most numerous, is the transfer tax (Impuesto sobre transmisiones patrimoniales, or ITP). It is a tax that is levied on all types of economic operations; among them, the sale of homes. We must take this tax into account, because sometimes it can be very high.
For example, in Barcelona it is usually 10-11%; or 8-11% in the Balearic Islands. In addition, today we would like to highlight the case of Andalusia, because, due to the huge drop suffered in 2020 with respect to the number of real estate transactions carried out in our country; and in order to encourage home purchases and boost the real estate market and the economy in general, the Junta de Andalucía has approved a reduced ITP of 7%. Normally around 8-10%.
Therefore, perhaps this is a good time to take the step, fulfill that dream and acquire a home in Spain. As we have already discussed in other situations, it is not as simple and fluid a process as the one we find in the Netherlands. In Spain, the first element we need is patience and adaptation, since there are many elements to take into account during the process.
In addition, the home we want may not meet all the legal requirements to be sold immediately. On many occasions, we come across properties that, in order to comply with the purchase and sale process, require a prior regularization process.
Finally, we strongly recommend that you have legal advice prior to and throughout the operation, and above all, do not sign anything or assume any commitment without having consulted your legal assistance.