How Much Does It Really Cost to Buy a Property on the Costa del Sol?
By George Nayda
11 March 2025
8 min read
AVOID MISTAKES
How Much Does It Really Cost to Buy a Property on the Costa del Sol?
Most buyers budget for the property price. But here’s what most don’t see coming: the real costs behind the dream.
Why the Listed Price Is Just the Beginning
Picture this:
You find your dream property in Marbella for €700,000. You mentally commit. But then the numbers start climbing. Not because of a scam but because of the silent partners in every property transaction: taxes, legal fees, notaries, and more.
Buyers are often blindsided by 10 to 13% in additional costs.
For a €700K property? That’s €70K to €91K extra.
Breakdown: What You’ll Actually Pay
Here’s a simple breakdown:
Transfer Tax (ITP): 7% for resale properties (most common).
VAT + Stamp Duty: 10% + 1.2% for new builds.
Notary Fees: €600 to €1,500 depending on property price.
Land Registry Fees: Similar range to notary.
Legal Fees: Usually 1% of the purchase price (+VAT).
Banking Costs: Currency conversion + transfer fees can bite if you're buying from abroad.
Optional but recommended:
Technical Survey: €400 to €800 (depending on the size of the property).
Mortgage Costs: If financing, add setup fees, valuation, and life insurance.
Let’s Talk About Taxes
Taxes are what catch most foreign buyers off guard.
If you’re buying a resale, that 7% ITP can sting.
If it's a new build, the 11.2% total in VAT and stamp duty.
But that’s not all. Some regions (notably Andalusia) offer tax reductions under certain conditions like being under 35, or buying a habitual residence. Worth checking with your lawyer.
If you plan to rent it out? You’ll also pay income tax (non-residents pay 19% EU / 24% non-EU on net rental income).
The Hidden Costs No One Mentions
Community Fees: Some gated communities can charge €200 to €500 per month.
IBI (Annual Property Tax): Ranges from €500 to €3,000+ depending on the property.
Garbage Collection Fee: A few hundred euros per year.
Home Insurance: Often mandatory with a mortgage.
Furnishing & Setup: If it's not turnkey, expect another €10K to €30K for furnishings.
These aren’t technically "buying" costs, but they add up fast.
How to Budget Like a Pro
Always use the +12% rule. Take your property price and add 12% for total buying costs.
So for a €500K home, your real budget is €560K. If you only have €500K all-in, look at properties around €440K max.
Work with a lawyer who speaks your language and gets the nuances of international buyers. And please: don’t just rely on what the agent tells you. A good agent will walk you through the full cost structure upfront. A great one will tailor it to you.
Final Word: No Nasty Surprises
Buying on the Costa del Sol is one of the best lifestyle and financial decisions you can make. But only if you walk in with eyes wide open.
Don’t let unexpected costs sabotage your experience. Ask questions. Compare fees. And plan for more than just the property price.
If you want to double-check your numbers or talk through your situation, I’m just a WhatsApp away. Zero pressure. Just clarity.
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