Buying a home is increasingly unattainable for many citizens in our country, since this acquisition represents one of the most significant economic investments in a person’s life, especially since the price of housing in Spain seems to have no ceiling. Although not all Spaniards can afford to buy a property, there are some lucky ones who manage to face the economic obstacles and they have the possibility of owning the house of their dreams.
New construction homes are usually preferred by buyers, since these have a series of advantages compared to second-hand ones such as greater energy efficiency, more customization options, fewer reforms and also has extras such as a swimming pool or garage, among others. So much so, that in 2022, six out of ten buyers considered buying a new construction homeas reported by the Fotocasa real estate portal.
However, this choice comes at a price, as New construction homes are, on average, between 5% and 10% more expensive, although its price can increase “much more”, according to the Appraisal Society. Therefore, if an average of 165,000 euros is paid for a property of 80 square meters; in the event that it is a new construction, it will be paid between 173,250 euros and 181,500 euros; that is, between 8,250 and 16,500 euros more.
Taxes when buying a home
In addition to notary expenses, appraisal expenses or even those of the Property Registry, among others; People who purchase a new construction home must pay a series of taxes.
The most important tax that must be assumed when acquiring a new construction home is VAT (value added tax), whose amount will amount to 10% of the final sale price (although in the Canary Islands the Tax will be applied General Indirect Canarian whose percentage stands at 6.5%) . Therefore, if a person takes the step of buying a house whose price amounts to 200,000 euros, the VAT will mean 20,000 euros that must be paid to the Treasury.
To this tribute must be added the Tax on Documented Legal Acts (IAJD), whose price will range from 0.5% to 1.5% depending on the autonomous community where the property is located. This tax is only paid when applying for a mortgage and, since the entry into force of the new Mortgage Law, it is the banking entities that are obliged to pay it.
On the other hand, in the event that the home is used, the most important tax that must be paid will be the Property Transfer Tax (ITP), whose cost will range from 6% to 10% depending on the autonomy where you reside and the proportion imposed on the registered price. The buyers have a maximum period of 30 days from the deed to make the payment to the Tax Administration of the autonomous community.