What costs are involved when selling my house in Spain?
17 August 2008 @ 22:35
When selling your property in Spain, many sellers are not fully aware of what they are going to have to fork out in terms of costs before getting the real net figure they want in their hand.
Make sure you take into account the following costs when selling:
1) Plus Valia - every seller has to pay a tax based on the incremental value of the land which the property occupies over the amount of years you have owned it. (eg: small apartments may be about 50 Euros per year, whereas villas may be a few hundred euros and more per year of ownership)
2) Community Fees: Make sure your Community Fees are up to date - normally you will have to present a CERTIFICADO DE COMUNIDAD to the buyer on signing the Escritura.
3) IBI & Utilities- Ensure your local tax council rates are up to date. You will have to provde the original proof od payment at the signing. Also ensure your utility bills are paid to date.
4) Mortgage Cancellation Fees - Your bank will probably have anywhere from a 0.5% to 1% cancellation charge on the balance of your outstanding mortgage
5) Mortgage Notary Cancellation & Registration Fees - In addition to point 4), as a seller you will have to ensure your mortgage is cancelled at the Notary and Registry. This may cost anywhere form 600 Euros to 1000 Euros, and is an amount that wil probably be retained by the seller to ensure this is done
6) Non Resident Retention Tax at 3%: If you are non-resident in Spain, the buyer of your property will also have to retain 3% of the Escritura Sales Price to pay directly to the Spanish tax man (hacienda) on your behalf. Residents do not have any retentions made on them.
7) Agents Commission - If you have used an Agent to sell your property, then you will also have to account for the Agents fees which can range from a 3% to 8% depending on the agent, and the agreement you have made with them.
Obviously you will still have your Capital Gains Tax Liability (18% on profit), but that will depend on your profit. For non-residents, the 3% retention tax counts towards this. Those of you who are making a loss still have to pay out the 3% retention tax, but can reclaim it back from the Spanish tax providing you have all the correct documentation and receipts to prove you have made a loss and paid your annual taxes.
Once you know what all of these costs may be, you can then work backwards to calculate what price you need to sell at inorder to walk away with the amount you have in mind in your hand.
That's all for today.
The Naked Agent Spain
Author of : "Your Stripped-Down Guide to Buying a Property and Getting a Mortgage in Spain"