If only it was as simple as paying the amount that is shown on the house’s price tag. Often, we are left scratching our heads trying to calculate how much the whole property purchasing process will cost. Well no need to fear as we are here to help you understand what expenses to expect when buying your dream home in Alicante.
The quick answer is 15% of the purchase amount, however, this amount will be slightly lower the higher the cost of the house. This percentage will also vary depending on whether a mortgage is requested too.
If we break things down there are seven main payments to consider. The first and most expensive is the ITP (Property Transfer Tax – in English). The price of this will vary depending on which autonomous community the house is in, but it will most likely be between 6 and 10% of the property’s cost. In Alicante and throughout the Valencian community the amount is usually 10%.
The second payment to consider is that of the Notary. This amount varies depending on the price of the house and the number of pages used in the deed. For example, a house worth €150,000 would result in an invoice of between 600 and 750 euros, depending on the deed length.
The third expense to consider is that of the Land Registry. If we take the price of the previous example (€150,000), this would cost between 450 and 600 euros. The Land Registry cost will always correspond to the cost of the Notary.
The fourth expense will depend on whether you hire an external agency to prepare, pay and present the tax models before the ‘Conselleria,’ as well as the deed of sale before the Property Registry. Although not obligatory, we advise you to do so, to ensure a smooth and safe sale. The average amount of these procedures can be estimated at 390 euros plus VAT.
The fifth expense is that of the lawyer who will defend your interests as a buyer. Although this step is optional, we highly recommend you do so as the buyer is the most vulnerable figure in a property’s sale transaction. Your lawyer will ensure that the sale of the property is properly defined in the Cadastre (an official Spanish record used to calculate the amount of tax owed) and in the Land Registry. A lawyer will also ensure that the agreement made will include all legal guarantees and will not contain any hidden surprises for the buyer. The price of this service will be previously agreed and can either be a fixed price or a percentage of the sale. On average this will cost between 1 and 1.5% as a minimum.
The last expense will be the transfer of utility services. Although it may seem like a simple process, it can be difficult as a certificate of habitability, issued by the City Council, will be required if the property is older than 10 years. To do this you will need to hire a technical architect to inspect the house and issue a report.
We recommend that you entrust the help of all stated professionals to ensure that the purchase process goes as smoothly as possible.