When buying a home, the price is not the only outlay. You should budget for a series of taxes and fees that together usually add up to around 10-13% on top of the purchase price. Knowing them in advance lets you plan your budget realistically and avoid surprises.
1. The main tax: transfer tax or VAT
The most important tax depends on whether the home is a resale or a new build:
- Resale — ITP (transfer tax): in the Balearic Islands it is progressive, running roughly from 8% to 13% depending on the property's value.
- New build — VAT + stamp duty: 10% VAT plus stamp duty (around 1.5% in the Balearics).
These are the typical brackets; the exact percentages can vary, so we always confirm the calculation for your specific case before signing.
2. Notary and land registry
Signing the deed before a notary and registering it at the Land Registry carry regulated fees based on the property's price. Together they usually amount to a small share of the total, but they need to be budgeted for.
3. Conveyancing and legal advice
The conveyancer (gestoría) handles the processing of taxes and registrations. In addition, it is highly advisable to have legal advice reviewing charges, licences and documentation before the purchase — a small investment that prevents far bigger problems.
4. Costs if you finance with a mortgage
If you take out a mortgage, budget for the property valuation and the bank's own costs. Since 2019, banks bear much of the mortgage costs, but the valuation is usually paid by the buyer. We help you compare the best financing with local and international banks.
5. An indicative example
For a €500,000 resale home, on top of the price you should roughly budget for:
- Transfer tax (ITP), according to the applicable Balearic bracket.
- Notary, registry and conveyancing.
- Legal advice and, where relevant, a valuation.
In total, around 10-13% extra. We always provide a clear, personalised breakdown before each transaction.
6. Ongoing costs after the purchase
Once you are the owner, you will have some recurring costs: IBI (property tax), the community of owners fee (if applicable), utilities and insurance. They are manageable, but worth including in your planning.
Frequently asked questions
How much should I add to the purchase price?
As a guide, between 10% and 13% extra for taxes, notary, registry and conveyancing.
Which tax do I pay, transfer tax or VAT?
Transfer tax (ITP) on resale homes and VAT (plus stamp duty) on new builds.
Are the costs the same for foreigners?
Yes, the taxes and fees are the same. If you are buying from abroad, we guide you with the NIE, the bank account and all the formalities.
Want to know if it is your moment and how much you would need? Also read our guide to buying as a foreigner, explore our available properties or contact us for a tailored breakdown.
