The Real Cost of Buying Property in Spain (2026)

This guide is for international buyers looking at a new development on the Costa del Sol, whether off-plan or key-ready new-build. You will get the true all-in cost, not just the sticker price. We show every tax, every fee, and the exact total on a 500.000 euros home.

At a glance: The listing price is never the price you pay. On the Costa del Sol, a new development costs about 12-14% extra in taxes and fees, while a resale (a second-hand home from a private owner) runs about 10-12%. On a 500.000 euros new-build, that is roughly 60.000 to 70.000 euros on top, so your true all-in cost is about 565.000 euros. If you buy off-plan, you also pay in stages during construction, not all at once. If you use a mortgage, you need a deposit of 30-40% in cash.

Here are the headline numbers on a 500.000 euros new development, paid in cash.

• 50.000 euros - IVA at 10%
• 6.000 euros - AJD stamp duty at 1,2%
• 6.050 euros - lawyer at 1% plus IVA
• ~565.000 euros - true all-in cost

That gap between the listing price and the real price is the number one fear for most buyers. Below, we remove the guesswork. Every figure is for 2026, and every example leads with a new development, because that is what we sell on the Costa del Sol.

Why the listing price is not the real price

When you see a home for 500.000 euros, that is just the start. Spain adds taxes and fees on top. These are not optional. They are part of every legal purchase.

The good news: the costs are mostly fixed by law and easy to predict. Once you know them, there are no nasty surprises. The total extra cost depends on two things:

• Is the home a new development (bought from the developer, either off-plan or key-ready new-build) or a resale (a second-hand home bought from a private owner)?
• Are you paying cash, or using a mortgage?

A new development costs a bit more in tax than a resale, but it comes with a fresh build, a 10-year structural guarantee, and modern energy ratings. We lead with the new development below, because that is what we sell, and we show the resale as the alternative for contrast.

Warning: Many buyers budget only 5-7% for extra costs. The real number is 12-14% on a new development. If you plan too low, you can run short of cash on completion day. Always plan for the full amount.

How you pay for a new development

A new development is not paid in one lump. The schedule depends on whether you buy off-plan (still being built) or key-ready (finished and ready to move in).

Off-plan, staged during construction:

• Reservation: a holding deposit of about 6.000 to 10.000 euros to take the home off the market.
• On the private contract: you top up to around 20% to 40% of the price, paid in stages as the building goes up. Each stage payment is protected by a bank guarantee (an aval), so your money is safe if the developer fails to deliver.
• At completion: you pay the remaining 60% to 80% balance when the home is finished and you get the keys.

Key-ready new-build, when the home is already finished:

• Reservation: the same holding deposit to secure the home.
• On the private contract: about 10% of the price.
• At completion: the balance, usually within a few weeks.

Worked example on a 500.000 euros off-plan home:

• ~10.000 euros - reservation
• up to ~200.000 euros - staged payments during the build (20% to 40%, bank-guaranteed)
• the balance - paid at completion when you collect the keys

This staged timing is one of the big differences from a resale. A resale (the alternative, covered below) is paid much faster: a 10% deposit, then the balance four to eight weeks later.

Bonus tip: Always check that every off-plan stage payment is backed by a bank guarantee. This is your protection. A good buyer's agent confirms the guarantee is in place before you pay a single stage.

Taxes on a new development (IVA + AJD)

A new development, whether off-plan or key-ready, has two purchase taxes.

• IVA (the Spanish word for VAT, the value-added tax): 10% of the price for homes. This is the same all over mainland Spain.
• AJD (stamp duty, a tax on the legal deed): 1,2% of the price in Andalucía.

Together, that is 11,2% in tax on a new development.

Worked example on 500.000 euros:

• 50.000 euros - IVA at 10%
• 6.000 euros - AJD stamp duty at 1,2%
• Total purchase tax: 56.000 euros

Bonus tip: Some developments sell the garage space and storage room (called a trastero) on a separate deed. If sold separately, these can carry 21% IVA, not 10%. Ask your agent to confirm the parking and storage are included in the home price. A good buyer's agent checks this for you before you commit.

The alternative: taxes on a resale home (ITP)

A resale is the contrast to a new development. It is a second-hand home from a private seller, and it does not pay IVA. Instead, you pay ITP (the transfer tax on resale homes).

In Andalucía, ITP is 7% of the price. There is no separate stamp duty on a resale, because ITP replaces it.

Worked example on 500.000 euros:

• ITP at 7%: 35.000 euros

So a resale costs less in tax than a new development. Here is the difference side by side.

• New development (11,2%): 56.000 euros
• Resale (7%): 35.000 euros

But a new development brings lower running costs, a 10-year structural guarantee, and modern energy ratings, and off-plan lets you spread the payments across the build. The choice is about more than just tax.

Bonus tip: On a resale, ITP must be paid within 30 days of signing the deed. Your lawyer handles this for you. Do not leave Spain thinking the job is done; the tax payment comes just after signing.

Notary and Land Registry fees

Every purchase in Spain is signed in front of a notary (a public official who makes the sale legal). After that, the home is recorded in the Land Registry (Registro de la Propiedad, the official record of who owns the property).

Both fees are set by law and are similar at every office.

• Notary fee: about 600 to 1.200 euros.
• Land Registry fee: about 400 to 700 euros.

Worked example on 500.000 euros:

• ~1.500 euros - notary
• ~1.000 euros - Land Registry
• Total: ~2.500 euros

These are small next to the tax, but they are real. Budget for them.

Lawyer fees

You are not required by law to use a lawyer. But for an international buyer, it is the smartest money you will spend. On a new development, a good lawyer checks the building licence, the developer's track record, and that every off-plan stage payment is covered by a bank guarantee. On a resale, the lawyer checks the home carries no debts and that the seller really owns it.

• Typical lawyer fee: about 1% of the price, plus 21% IVA on the fee.

Worked example on 500.000 euros:

• 5.000 euros - lawyer fee at 1%
• 1.050 euros - IVA on the fee at 21%
• Total: ~6.050 euros

Danger: Never use only the developer's lawyer (or, on a resale, the seller's lawyer). They work for the other side. You want your own independent lawyer who works only for you. This protects you from inherited debts and planning problems.

At Spain Developments, we are an independent buyer's agent. The developer pays our fee, so you pay us nothing. We also help you find a trusted independent lawyer, so you are never alone in the process.

Mortgage costs (if you borrow)

If you pay cash, you can skip this section. If you borrow, add a little more.

Spanish banks lend non-residents about 60% to 70% of the price. So you need 30% to 40% of the price in cash, plus all the costs above. The deposit is not a "cost" as such, but you must have it ready.

Extra mortgage costs:

• Property valuation (the bank's check on the home's value): about 300 to 600 euros.
• Bank arrangement fee: 0 to 1,5% of the loan. Often negotiable.

Good news: since 2019, Spanish law makes the bank pay the mortgage stamp duty, the mortgage notary fee, and the mortgage registry fee. You do not pay those. Check your bank does not try to add them.

Worked example on 500.000 euros with a 65% mortgage (325.000 euros loan):

• ~500 euros - valuation
• 3.250 euros - arrangement fee at 1%
• Total: ~3.750 euros

Bonus tip: Spanish banks do not lend you the money for taxes and fees. That 12-13% must come from your own savings. Plan your cash carefully.

Small but real extra costs

A few more small costs apply, mostly for international buyers:

• NIE number (your Spanish tax ID for foreigners): about 10 to 150 euros, depending on whether you use an agent to speed it up. You cannot buy without it.
• Spanish bank account: usually free to open, but you will need one.
• Power of attorney (if you cannot attend the signing in person): about 150 to 300 euros.
• Utility connections (water, electricity) on a new-build: about 200 to 500 euros.

These are not large, but they add up. Budget around 500 to 1.000 euros for this group.

Currency exchange: a hidden cost

This one catches many buyers. If you earn in pounds, krona, or złoty, you must change your money into euros. The home is priced in euros.

High-street banks often add a poor exchange rate plus fees. This can cost up to 3% of the amount you send. On a 500.000 euros purchase, 3% is 15.000 euros lost to a bad rate.

A specialist currency broker usually beats the bank. The saving can be thousands of euros. You can also "lock" a rate in advance, so a falling pound does not raise your price between offer and completion.

Worked example: Sending about 565.000 euros (price plus costs). A bank rate could cost you 3% more than a broker. That is a possible saving of up to 17.000 euros by using a specialist.

Bonus tip: Plan your currency transfer early, not on signing day. Rushing a large transfer is how people lose money. We can point you to trusted FX (foreign exchange) specialists who serve Costa del Sol buyers.

The full cost breakdown on 500.000 euros

Here is the complete picture for a 500.000 euros home on the Costa del Sol, paying cash. First the new development (what we sell), then the resale as the alternative.

New development, paying cash

• 500.000 euros - purchase price
• 50.000 euros - IVA at 10%
• 6.000 euros - AJD stamp duty at 1,2%
• 1.500 euros - notary
• 1.000 euros - Land Registry
• 6.050 euros - lawyer at 1% plus IVA
• 700 euros - NIE, bank, utilities
• Total extra costs: 65.250 euros
• Total all-in cost: 565.250 euros

If this is an off-plan home, the all-in figure is the same, but the cash goes out in stages: about 10.000 euros to reserve, 20% to 40% in bank-guaranteed payments during the build, and the rest at completion. A key-ready new-build follows the faster path: reservation, then 10% on the contract, then the balance on completion.

Resale, paying cash (the alternative)

• 500.000 euros - purchase price
• 35.000 euros - ITP transfer tax at 7%
• 1.500 euros - notary
• 1.000 euros - Land Registry
• 6.050 euros - lawyer at 1% plus IVA
• 700 euros - NIE, bank, utilities
• Total extra costs: 44.250 euros
• Total all-in cost: 544.250 euros

So a 500.000 euros new development really costs about 565.000 euros all-in. That is roughly 13% more than the listing price. A resale comes to about 544.000 euros, roughly 9% more.

Note: This breakdown assumes a cash purchase. With a mortgage, add about 3.750 euros in mortgage costs. With a foreign currency, factor in the exchange spread too. Remember that an off-plan purchase spreads the payments over the build, while a resale is paid in just four to eight weeks.

How much cash do you really need?

This is the question that matters most. Two simple cases, both on a new development.

Paying cash, new development, 500.000 euros: you need the full all-in amount, about 565.000 euros. On an off-plan home you release it in stages over the build; on a key-ready home you pay it over a few weeks.

Using a 65% mortgage, new development, 500.000 euros:

• 175.000 euros - deposit (35% of price)
• ~65.250 euros - taxes and fees
• ~3.750 euros - mortgage costs
• Total cash needed: ~244.000 euros

The bank lends the other 325.000 euros. This is why honest planning matters. You should know your true number before you fall in love with a home.

At Spain Developments, we give you this full breakdown for any home you like, before you commit. There is no buyer fee, because the developer pays us. Our job is to make sure you have no nasty surprises.

Conclusion

The real cost of buying a new development on the Costa del Sol is about 12-14% on top of the price. On a 500.000 euros new-build, that means around 565.000 euros all-in. The biggest items are IVA, stamp duty, and your lawyer; the easiest savings come from a good currency broker. If you buy off-plan, you spread the payments across the build, with the balance due at completion. A resale, by contrast, costs about 10-12% on top and is paid much faster. Plan for the full amount and there will be no shocks on completion day.

Want the exact all-in number for a home you have seen? Get in touch with Spain Developments and we will break it down for you, with no fee and no pressure.