COSTS IN A PURCHASE
The cost start with the tax that will depend if the purchase is from the developer in which case will be IVA (VAT) or from a private purchase or second transmission which will be transfer tax:
a.- The VAT is 10% in houses and together to this tax it comes as well the stamp duty which is 1,5%, so the tax involved in purchase from the developer will be 11,5% in total. The VAT has to be paid to the developer at the moment of each of the different payments that needs to be paid during the purchase process. The stamp duty will need to be paid within a month after completion and to the tax office.
b.- The transfer tax for second transmission is 8% up to 400.000 euros; 9% from 400.000 to 700.000 euros and 10% from 700.000 on. This tax will have to be paid to the tax office within a month after completion.
Beside the tax the other costs involved are:
- The Notary and Registry costs are the fees of these professionals. The Escritura (title deed) must be signed before a Notary Public and registered in the Land Registry. These costs depend on several factors, i.e., number of folios, price, document adjoined, etc; Usually between those two professionals together will be less than 1% of the price.
- Legal fees.- It is not strictly necessary , but contract a lawyer is highly recommendable (what else can I say), and the costs will depend being the usual figure around 1%.
Finally if you need a mortgage, it will have as well costs as it has tax to pay and notary and registry fees.