Useful information

Costs involved in buying a property

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Taxes

IGIC
(Indirect General Canary Tax). This tax has to be paid upon purchasing any new property – it currently stands at 5% of the purchase price – and is to be paid directly to Alicur.
Plusvalía.
(Capital Gains Tax) This tax is only payable when a transfer of title is involved and, in this case, Alicur would have to pay this tax as the Law clearly indicates that it is the Seller who pays it.
IBI
(Rates) This is a local property tax collected yearly by the Council. The amount to be paid is set by the Council.

Costs behind Signing of Deeds

The costs involved in the Signing of Deeds (expressed as a percentage of the value of the property) depend upon the way in which you purchase the property. Basically, there are three different scenarios:

If you do not require a mortgage.
The costs involved would amount to approximately 2% of the purchase value. That amount would be needed to pay the expenses behind the Signing of the Deed of Sale – Notary’s Fee, Taxes and Registration of Deeds. If you wish, we can recommend an Agency (Gestoría) that will do all the paperwork for you or, if not, we can tell you how to do it yourself.
If you want to take over your property’s existing mortgage* (taken out by Alicur)

*This is usually referred to as Subrogation (Subrogación) in Spain

The costs involved would amount to approximately 4% of the purchase value. That amount would be to pay the following:
  1. The expenses behind the Signing of the Deed of Sale with Subrogation,, on a single Deed (Purchase and Transfer of Title), namely Notary’s Fee, Taxes and Registration of Deeds
  2. Bank Charges:
    • Subrogation fee (based upon the the value of the existing mortgage)
    • Novation fee (if you change the initial terms and conditions of the mortgage)
    • Refinancing fee (if you request a larger mortgage, to which you would have to add the cost of a new property valuation)
    • Household Insurance (this is obligatory)
    • The Signing and Registration of the Deeds (carried out by the bank’s own Agency).
If you do not want to take over your property’s existing mortgage, but need to mortgage the property with another bank.
This could bring the costs involved up to 8% of the purchase value – it all depends on the conditions you negotiate with your bank. That amount would be to pay the following:
  1. The expenses behind the Signing of the Deed of Sale
    Notary’s Fee, Taxes and Registration of Deeds.
  2. The expenses behind the Signing of the Mortgage.
    Notary’s Fee, Taxes and Registration of Deeds.
  3. Bank Charges.
    • Opening fees
    • Property valuation
    • Household insurance (this is obligatory)
    • The Signing and Registration of the Deeds (carried out by the bank’s own Agency).