When considering buying property in Marbella, understanding the associated purchase costs and taxes is crucial. This guide will provide you with a comprehensive overview of what to expect, ensuring you are well-prepared for your investment. At MPM Real Estate Buyer Consultants Marbella, we aim to make your property buying experience as smooth and enjoyable as possible.

Understanding Purchase Costs in Marbella

When purchasing property in Marbella, the costs involved can be broadly categorised into purchase price, taxes, and additional fees. Typically, the total purchase costs amount to approximately 10% of the property’s sales price. This includes various taxes, legal fees, and other expenses directly related to the purchase.

For new properties purchased directly from developers, buyers are required to pay a VAT of 10% of the sale value, plus a 1.2% stamp duty. However, for commercial premises, some garages not attached to a dwelling, and plots of land, the VAT is 21% plus 1.2% stamp duty.

For resale homes, a Transfer Tax is applicable, set at 7% of the reference value of the property. The reference value is determined by the cadastral value and market values, updated annually. It’s essential to consult the Cadastre Headquarters website to obtain the reference value of a property.

Breakdown of Property Taxes in Marbella

Property taxes in Marbella can be complex, with several types to consider. The main taxes include the Real Estate Tax (I.B.I.), Wealth Tax, and the recently introduced Solidarity Tax.

The Real Estate Tax (I.B.I.) is levied by the Town Hall and is a percentage of the cadastral value of the property. Rates vary depending on the municipality, typically ranging between 0.3% and 1.3% of the cadastral value. It’s important to obtain a copy of the last I.B.I. receipt from the seller before finalising the purchase.

Wealth Tax in Andalusia is currently 100% subsidised, meaning it is not payable. However, the Solidarity Tax on Great Fortunes, applicable to individuals with net wealth exceeding 3 million euros, ranges from 1.7% to 3.5%. This tax is currently under appeal but remains applicable for now.

Legal Fees and Other Associated Costs

Legal fees and other associated costs are an integral part of the property buying process in Marbella. Notary fees and the registration of title in the Land Registry are stipulated by law on a sliding scale, amounting to approximately 1.5% of the purchase price.

Engaging a local lawyer is advisable to guide you through the investment process. The lawyer’s fee is typically around 1% of the purchase price. Additionally, it is necessary to register the new ownership by registering the deed of sale (escritura pública) at the Land Registry.

Other associated costs include community charges, which are fees paid to the Community of Owners for the maintenance of common areas in urbanisations or condominiums. These fees must be up to date at the time of signing the deed of sale.

Tax Incentives for Property Buyers

There are several tax incentives available for property buyers in Marbella. For instance, there are reductions in transfer tax for residents, professionals, and companies under specific conditions. For properties intended as the main residence and valued under 150,000 euros, the transfer tax is reduced to 6%.

Further reductions apply for buyers under 35 years of age, victims of domestic violence or terrorism, or those purchasing in municipalities with depopulation issues, with the transfer tax set at 3.5%. Additionally, individuals with disabilities or members of large families can benefit from a reduced transfer tax of 3.5% for properties valued under 250,000 euros.

For those engaged in business activities related to real estate, a reduced transfer tax of 2% is applicable, provided the property is resold within five years. These incentives can significantly reduce the overall cost of purchasing property in Marbella.

Tips for Managing Costs and Taxes Effectively

Managing purchase costs and taxes effectively requires careful planning and professional advice. Here are some tips to help you navigate the process:

  • Engage a local lawyer to guide you through the legal aspects of the purchase.
  • Consult a tax advisor to understand the specific tax implications and incentives available to you.
  • Ensure all community charges and taxes are up to date before finalising the purchase.
  • Utilise the services of a reputable real estate consultant, such as MPM Real Estate Buyer Consultants Marbella, to assist with property search, negotiation, and legal processes.

By following these tips, you can ensure a smooth and cost-effective property buying experience in Marbella.

At MPM, we are committed to making your dream of owning a beautiful home in the Marbella area a reality. Our dedicated buyer agents are here to guide you every step of the way, ensuring that you find the perfect property that meets your unique preferences and needs. Ready to discover the key to your dream home? Contact our expert team today and let us help you unlock the doors to your future.