What Buying a Home in Spain Actually Costs

Budget between 8% and 14% of the purchase price, on top of the price itself.

That is the short answer. The range is wide because the largest cost, transfer tax, is set by each Spanish region rather than nationally.

This article covers what those costs are, what changed recently, and the US tax questions an estate agent has no reason to raise. It is general information, not advice about a particular purchase.

What a resale home costs

On a resale property, the buyer pays the Impuesto sobre Transmisiones Patrimoniales, usually shortened to ITP.

It is a regional tax. The spread between regions is large enough to matter to where you buy.

Cost	Typical amount
Transfer tax (ITP)	6% to 13%, depending on region and price band. Madrid and the Canary Islands sit at the low end. Several regions use sliding scales reaching 11% to 13% on higher-value homes
Notary	Roughly €600 to €1,200 on a typical home, set by national tariff
Land registry	Roughly €400 to €800, also by tariff
Gestoría	Commonly €300 to €600. Freely priced, so negotiable
Lawyer	Typically 1% of the price, and worth having as a foreign buyer

Add those up and a buyer in Madrid might be near 8% all in. A buyer of a higher-value property in a high-ITP region can approach 14%.

Estate agent commission is normally paid by the seller.

What about a new build?

A new build is taxed differently.

Instead of ITP, the buyer pays IVA at 10% on the delivery of the dwelling by the developer. On top of that comes a regional stamp duty, the Actos Jurídicos Documentados. That runs from 0.75% in Madrid and the Canary Islands to about 1.5% in most other regions.

So a reasonable all-in budget on a new build is around 12% to 13%, before lawyer’s fees and mortgage costs.

The Golden Visa no longer exists

This is the item most out-of-date articles still get wrong, including an earlier version of this one.

Spain’s investor residence visa, including the €500,000 real estate route, was repealed by Ley Orgánica 1/2025, de 2 de enero. The repeal took effect on 3 April 2025. No new applications have been accepted since.

Applications filed before that date continue under the old rules. Permits already granted remain valid until their stated expiry, with renewals decided under the rules in force when the original permit was granted.

Anyone moving to Spain now uses the general immigration routes instead, such as the non-lucrative visa or the international teleworking visa.

Buying a property does not, by itself, give you the right to live in Spain.

Is there a new tax on non-EU buyers?

No. Not as of today. This deserves a clear answer, because the claim circulates widely.

In January 2025 the Prime Minister announced an intention to introduce a complementary state tax on transfers of property to non-EU non-residents, at 100%. It was written into a bill presented in Congress in May 2025.

That bill has not been enacted. It has not progressed. Nothing corresponding appears in the BOE, and no region has enacted anything equivalent.

So there is no surcharge in force on non-EU buyers of Spanish property.

It is worth watching, because it would change the arithmetic considerably. It is not worth planning around today. Any article describing it as an existing tax is wrong.

What about a mortgage?

Spanish law sets no statutory loan-to-value cap. So this is bank credit policy rather than regulation.

Market practice is generally more conservative for non-residents. Commonly around 60% to 70% of the lower of price or appraised value, against up to roughly 80% for a resident buying a primary home.

Those percentages are practice rather than law, and they vary between lenders. Treat them as a starting point for conversations.

The US tax consequence nobody raises

There is a US consequence to a euro mortgage that almost nobody mentions at the time.

Under US rules, repaying or refinancing a foreign currency loan can produce a taxable foreign currency gain for a US person. That happens if the dollar has strengthened against the euro since the loan was taken out.

It is a genuine item and it is easy to miss. Worth understanding before you borrow rather than at the point of refinancing.

Debts follow the property

This is the most expensive thing to get wrong on a Spanish purchase. It is also the reason to use a lawyer rather than only a gestor.

Some obligations attach to the property itself rather than to the person who incurred them.

A mortgage is a right in rem. It remains on the property unless cancelled at completion.
Unpaid community fees. Under the horizontal property law, the property is liable for arrears attributable to the elapsed part of the year of acquisition plus the three preceding calendar years.
Unpaid IBI, the local property tax. The property is afecto to the liability on transfer.
Municipal plusvalía is the seller’s tax. Where the seller is non-resident, the buyer becomes substitute taxpayer.

The practical protection is a nota simple from the Registro de la Propiedad, a certificate of no community arrears, and proof that IBI is current. Get all three before completion rather than after.

The NIE

The Número de Identidad de Extranjero is the identification number Spain assigns to a foreigner with economic interests in the country.

A notary will not complete a purchase deed without one.

You apply on form EX-15. You can do it at a Spanish consulate before you travel, or in Spain at a Comisaría de Policía or Oficina de Extranjería by appointment.

A representative can apply on your behalf with a power of attorney. That is worth arranging early if your purchase is on a timetable.

What the market is doing

Spanish house prices have been rising firmly rather than drifting.

The national statistics institute recorded an annual increase of 12.9% in the first quarter of 2026. Second-hand homes rose 13.5% and new builds 9.1%. Transaction volumes have been broadly stable at high levels.

What that means for a buyer is straightforward. This has not been a market where waiting is free. It is also not a market where the transaction costs above get recovered quickly if you buy and sell within a couple of years.

Questions Americans should ask before buying

The purchase costs are the visible part. For a US citizen there are three further questions with larger financial consequences.

Does the property push you into wealth tax?

Spanish real estate counts toward the Impuesto sobre el Patrimonio. The state exempt minimum is €700,000 per taxpayer, with a further exemption of up to €300,000 for a primary residence. Regions vary considerably.

A purchase that looks affordable on the mortgage arithmetic can create an annual tax that was never in the budget.

Does buying change your residency picture?

Owning a home in Spain does not by itself make you a Spanish tax resident. It can contribute to the assessment of where your economic interests sit. If the purchase comes with more time in Spain, count the days.

What happens when you sell?

A sale is taxable in Spain and, for a US citizen, on the US return as well.

The US principal residence exclusion and the Spanish reinversion relief have different conditions. It is entirely possible to qualify for one and not the other. Buying is the moment to understand that, not selling.

There is also a reporting point. Real estate held outside Spain is one of the three Modelo 720 categories, each with its own €50,000 threshold. So a US property you keep after moving is likely reportable. Modelo 720 covers the detail.

Should you buy in the first year?

My general view, and it is a view rather than a rule, is that renting for the first year is usually better.

Transaction costs of 8% to 14% on the way in are a substantial hurdle if you discover the city or the neighborhood is not right.

Regions also differ enough on tax that where you buy has consequences beyond lifestyle. And a first year in Spain surfaces plenty of other financial questions, which are easier to resolve without an illiquid asset attached.

Still choosing a region? Where Americans Actually Retire in Spain is a starting point. The wider checklist is in Five Financial Mistakes Americans Make Before Moving to Spain.

Frequently Asked Questions

How much should I budget beyond the price?

Between 8% and 14% on a resale, driven mainly by regional transfer tax. Around 12% to 13% on a new build, where IVA and stamp duty apply instead.

Can I still get residency by buying property?

No. The investor visa, including the €500,000 property route, was repealed with effect from 3 April 2025.

Do the previous owner’s debts become mine?

Some do. Community fee arrears for the current year plus three preceding years, and unpaid local property tax, attach to the property itself. Checking before completion is essential.

Will buying make me a Spanish tax resident?

Not on its own. Residency generally turns on spending more than 183 days a year in Spain, or on where your main economic interests sit. Property ownership can form part of that assessment.

Working with a cross-border adviser

A Spanish lawyer handles the conveyancing. A gestor handles the paperwork.

What tends to have nobody assigned to it is what the purchase does to your overall position. The wealth tax exposure. The currency and mortgage decision. The eventual sale on two tax returns. And where the money comes from without triggering an unnecessary gain.

Cross Border Wealth Advisors is a fee-only fiduciary firm serving US citizens living in or moving to Spain. I hold both the CFP® certification and an Enrolled Agent license, so the tax consequences and the planning decision get worked through together.

Everything above is general information, not advice about a particular purchase, and not legal or immigration advice.

Weighing a purchase in Spain? Book an introductory conversation at cbwealthadvisors.com or email info@cbwealthadvisors.com.

Sources

Disclosures

This article is general educational information published by Cross Border Wealth Advisors, a company of Gersten Financial Planning Inc., an investment adviser registered with the State of California (CRD 309890). It is not investment, tax, legal or immigration advice.

Tax, immigration and property rules change. The figures here are stated as of the date above. Where this article describes something as a proposal rather than law, that distinction is deliberate. Cost ranges are illustrative and will differ for any particular property. Cross Border Wealth Advisors is fee-only and receives no commissions. Registration does not imply a certain level of skill or training.

Please read the full article disclosures, which apply to everything published here.

The Costs of Buying a Home in Spain