You have found the villa, the view is perfect and the price looks like a bargain compared with anything at home. Then someone mentions "costs", and the number goes up by a figure that would buy a decent car. Here is what to budget for when buying in Spain, so the surprise happens on paper and not at the notary's office.
The rule of thumb
Set aside an extra 10% to 15% of the purchase price for taxes and fees. Where you land in that range depends mostly on which region you buy in and whether the property is new or resale.
Buying a resale property
Most homes Britons buy are resale, and the big cost is property transfer tax, known as ITP. It is set by each region, so the same house costs a different amount depending on which side of a regional border it sits. Typical rates in 2026 are:
- Madrid: around 6%
- Andalucía, including the Costa del Sol: around 7%
- Balearic Islands: around 8% to 11%, rising with the price
- Valencia region, including the Costa Blanca: around 10%
- Catalonia: around 10%
Rates and reduced rates for some buyers change from time to time, so check the current figure for your region before you commit.
Buying a new build
New builds bought from a developer don't pay ITP. Instead you pay 10% VAT (IVA) on the price, plus stamp duty (AJD) of roughly 0.5% to 2% depending on the region. In the Canary Islands, a local tax replaces VAT at a lower rate.
The fees on top
- Notary: usually a few hundred to around €1,200, depending on the price.
- Land Registry: typically a few hundred euros.
- Lawyer: around 1% to 2% of the price plus VAT. Not legally required, but strongly recommended unless you enjoy reading Spanish contracts for fun.
- NIE: the foreigner's identity number you need before you can buy anything. The fee is small, but getting an appointment can take weeks.
- Mortgage costs: if you borrow, budget another 2% to 4% of the loan for valuation, arrangement and related fees.
A worked example
Take a €300,000 resale apartment in Andalucía. Transfer tax at 7% is €21,000. Add around €1,500 for the notary and Land Registry, and a lawyer at 1% plus VAT, roughly €3,600. That's about €26,000 in costs before any mortgage fees, so you need around €326,000 rather than €300,000.
Borrowing as a non-resident
Spanish banks lend to UK buyers, but usually only up to about 70% of the value for non-residents, so you need a deposit of at least 30% plus the costs above. Exchange rates matter too. A small move in sterling can change the price of your dream home by thousands, which is why many buyers fix a rate with a currency specialist rather than leaving it to their high-street bank.
Costs that come later
Once you own the property, expect annual local property tax (IBI), community fees if you are in a development, and non-resident income tax if you don't live there full time, even if you never rent it out. When you sell, there is capital gains tax and a local tax on the increase in land value. None of these are huge, but they are easier to plan for than to discover.
Next steps
A good independent lawyer will check the property is legal, debt-free and properly registered before you sign anything. Expat Confidant can introduce you to a vetted Spanish property lawyer and a currency specialist to help you get the numbers right.
This guide is general information, not legal or financial advice. Tax rates vary by region and change over time, so check the current position with a qualified adviser.