One of the most common mistakes foreign buyers make when purchasing property in Torrevieja or anywhere else in Spain is focusing solely on the asking price. However, the true cost of a purchase goes far beyond the advertised amount. Taxes, administrative fees, and other expenses can significantly increase the final budget if not factored in from the outset.

The first major expense is the taxes associated with the purchase. If you buy a resale property, you’ll have to pay the Property Transfer Tax (ITP), the rate of which varies depending on the autonomous community. In the Valencian Community, the standard rate is usually 10%. On the other hand, if the property is newly built, you’ll need to pay VAT and the Stamp Duty (AJD).

These taxes are in addition to notary and registry fees. The public deed of sale must be formalized before a notary and subsequently registered in the Property Registry. Although these amounts are usually less than the taxes, they form part of the total cost of the transaction and must be included in the budget.

Another cost that many buyers don’t anticipate is professional fees. Having a lawyer specializing in real estate law is an investment that provides legal security throughout the entire process. Furthermore, if the transaction requires certified translations, powers of attorney, or legal representation, there may be additional costs.

It’s also important to analyze any outstanding debts associated with the property. While a proper legal review can identify them, some properties may have unpaid community fees, special assessments approved before the purchase, or extraordinary expenses anticipated by the homeowners’ association. These amounts can become an unexpected financial burden for the new owner.

For foreign buyers financing the purchase with a mortgage, there are additional expenses related to the property appraisal, insurance required by the financial institution, and other banking costs. Although legislation has reduced some of these expenses in recent years, they remain factors that must be considered.

Another common hidden cost appears after the purchase. Changing utility accounts, minor repairs, furniture, home insurance, or annual taxes can represent a significant expense during the first few months of ownership.

Therefore, before buying a home in Spain, it is advisable to request a detailed estimate of all costs associated with the transaction. Proper planning allows you to avoid unpleasant surprises and make informed decisions.

Before committing to a purchase, consult with A&G Lawyers and find out exactly how much the transaction will cost you from start to finish.