Buying Costs in Spain: What Foreigners Actually Pay on Top of the Purchase Price

The Short Answer: Budget 8–12% on Top of the Purchase Price

When you buy property in Spain as a foreigner, the purchase price is just the starting point. On top of that, you will pay transfer tax (or VAT on new builds), notary fees, Land Registry fees, and legal costs. In Madrid, these extra costs typically total around 8–9% for a resale property. In Catalonia or Valencia, they can reach 12% or more.

Most international buyers underestimate this. Some discover the full picture only at the notary table, weeks before signing. This guide explains every cost, how it is calculated, and how Madrid stacks up against other Spanish regions.

Who This Affects

This guide is for anyone buying property in Spain as a foreigner — whether you are a non-resident buying a second home, an expat relocating for work, or an EU citizen purchasing your first Spanish property. The cost structure is the same regardless of your nationality or residency status. The rates, however, vary significantly by autonomous community.

How Buying Costs Are Calculated

Spanish property purchase costs fall into two categories depending on whether you are buying a resale property or a new build.

Resale Property (Segunda Mano)

ITP — Impuesto sobre Transmisiones Patrimoniales (Transfer Tax)

This is the main tax on resale purchases. It is levied on the declared purchase price (or the official reference value, valor de referencia, if higher — whichever the tax authority deems correct).

Rates by autonomous community (as of 2026):

Madrid's 6% rate is one of the lowest in Spain. On a €600,000 property, the difference between Madrid and Catalonia is €24,000 in tax alone.

Notary Fees

Notary fees are set by a regulated national fee scale and are based on the declared purchase price. For a property in the €400k–€700k range, expect to pay roughly €1,000–€1,800. These fees are split between buyer and seller by convention, though the buyer typically pays for the public deed (escritura).

Land Registry Fees

Registering the property in your name at the Land Registry (Registro de la Propiedad) costs approximately 60–80% of the notary fee — typically €600–€1,200 for a mid-range purchase.

Legal Fees

Hiring a Spanish property lawyer (abogado) is optional but strongly recommended, especially for foreign buyers. Expect to pay 0.5–1% of the purchase price, often with a minimum of €1,500–€2,000. Some international buyers use a gestor (administrative specialist) instead, at lower cost, but legal review of the contract is advisable.

New-Build Property (Obra Nueva)

New builds are subject to VAT rather than ITP:

• IVA (VAT): 10% on residential new builds (21% on commercial property and land)
• AJD (Actos Jurídicos Documentados): Stamp duty — typically 0.5–1.5% depending on the community. In Madrid, this is 0.75%.

Notary and Land Registry fees apply in the same way as resale.

Worked Example: €600,000 Resale in Madrid

This is a complete breakdown of additional costs for a buyer purchasing a €600,000 second-hand apartment in Madrid in 2026, paying cash (no mortgage).

Note: If the same property were purchased in Catalonia, ITP alone would be €60,000 (10%), bringing the total add-on to roughly €65,000 — or nearly 11%.

If You Have a Mortgage

Since the 2019 mortgage law reform, banks absorb most mortgage-related taxes (AJD on the mortgage deed). As a buyer, you pay:

• Property appraisal (tasación): €300–€600
• Bank opening commission (if applicable): 0–1% of the loan amount

This is significantly cheaper than pre-2019, when buyers paid AJD on the mortgage as well.

Common Mistakes Foreign Buyers Make

1. Budgeting only the purchase price The most common error. Always model 8–10% extra in Madrid, 10–12% in other regions.

2. Ignoring the valor de referencia Since 2022, Spain's tax authority uses an official reference value (valor de referencia del Catastro) as the minimum taxable base for ITP. If you negotiate a purchase price below this value, you still pay ITP on the reference value. Always check the reference value before making an offer — your lawyer can do this.

3. Not having a NIE in advance You cannot complete a property purchase without a NIE (Número de Identificación de Extranjero). Getting one takes time. See our NIE guide for the full process.

4. Transferring funds without a compliant trail Spanish notaries are required to verify the origin of funds for large property transactions. Wire transfers from foreign accounts are fine, but the documentation must be in order. Cash is not accepted at notary.

5. Skipping the nota simple check The nota simple is the Land Registry extract showing who owns the property, its description, and any charges or encumbrances. Always obtain one before signing anything.

The Madrid Advantage

Madrid's 6% ITP rate is a meaningful financial advantage over most other Spanish regions. For a €600,000 purchase, Madrid saves you €24,000 compared to Catalonia and €12,000 compared to Andalusia — that gap shows up immediately in your purchase costs.

Madrid also has no regional wealth tax (100% bonus) and generous inheritance and gift tax exemptions. For buyers comparing Spanish cities, the overall tax environment in Madrid is consistently the most favourable for buyers in the mid-to-high price range.

You can explore current Madrid property listings on Frankly to get a sense of what your budget covers in different neighbourhoods.

When to Get Professional Help

You should engage a Spanish property lawyer or gestor before signing any document — including a reservation agreement. Specific situations that require specialist input:

• You are buying off-plan (obra nueva) — contracts are heavily weighted toward developers
• The property has any charges, liens, or community debts
• You are buying through a company structure
• You are purchasing with a mortgage from a Spanish bank
• You have any doubt about the valor de referencia or the declared price

A good abogado will review the title, check for encumbrances, verify community fees, and accompany you through the full transaction. Budget at least €1,500–€3,000 for this service on a mid-range purchase.

This article is for informational purposes only and does not constitute legal or tax advice. Please consult a qualified gestor or asesor fiscal for advice specific to your situation.