The asking price is only the opening line. From Andalucía's 7% transfer tax to new-build VAT, notary signatures and the quiet annual bills that follow, here is what buying on the Costa del Sol really costs.
There is a particular moment, usually on a terrace with the light going amber over the Mediterranean, when a buyer decides. The view settles it; the arithmetic comes later. This guide is about that later part: the taxes, fees and quieter obligations that sit between the asking price and the keys in your hand. None of it is mysterious, but it rewards being understood before the offer goes in, not after.
A note first on what buying no longer brings. Spain's Golden Visa was abolished in April 2025 — buying property no longer grants residency. Whatever you may have read in older brochures, a purchase today is a home, an investment or both. It is not a residence permit, and anyone planning to live here should look at the visa routes that remain open separately from the purchase itself.
The first question: resale or new-build?
Walk through a 1990s pueblo-style townhouse in the hills, with its terracotta floors worn smooth and bougainvillea spilling over the wall, and then step into a freshly finished apartment where the glass still smells of cleaning solution. Beyond the aesthetics, these two homes are taxed in entirely different ways, and that single distinction shapes your budget more than anything else.
Resale homes: Transfer Tax (ITP)
When you buy a property from a private owner, you pay Impuesto de Transmisiones Patrimoniales. Andalucía's transfer tax (ITP) on a resale purchase is 7%. Set by article 41 of Andalucía's tax law, Ley 5/2021, it is paid by the buyer after completion and is usually the largest single cost beyond the property itself. On a resale villa of €800,000, that is €56,000.
The same law sets reduced rates for a narrow group of purchases: 6% where the home becomes the buyer's main residence and is valued at no more than €150,000, and 3.5% for certain qualifying buyers, within value limits of €150,000 or €250,000 depending on the case. Both depend on the property being the buyer's main home, so a holiday or second home pays the general rate. Simple enough, but ITP is only one of the lines on the bill.
New-build homes: VAT and stamp duty (AJD)
Buy from a developer and ITP falls away, replaced by 10% VAT (IVA) on the price of a residential property, the reduced rate that article 91 of the VAT Act, Ley 37/1992, applies to homes, plus stamp duty, Actos Jurídicos Documentados, at 1.2% in Andalucía under article 49 of Ley 5/2021. The same €800,000 figure becomes €80,000 in VAT and €9,600 in AJD. VAT is normally paid in stages alongside the payments to the developer, which matters for cash-flow on an off-plan purchase. That difference between the two routes is exactly why the next set of costs deserves its own attention.
The signatures: notary, registry and legal fees
The notary's office in Marbella or Málaga is a hushed, wood-panelled sort of room, where documents are read aloud in Spanish and an interpreter murmurs alongside. Here the title deed, the escritura, is signed, and from here it travels to the Land Registry to be recorded in your name.
Together, notary fees, registry fees and independent legal fees typically add around 1–1.5% of the purchase price. Notary and registry charges follow regulated scales; legal fees are agreed with your lawyer. That lawyer is worth every euro: they check the title is clean, that there are no outstanding debts attached to the property, that the building has its licences in order and that community and municipal charges are paid up. If there is one line not to economise on, it is this one, and it leads naturally to the practical paperwork every buyer needs.
The practicalities: NIE, bank account and deposits
Before any of this, you will need an NIE, the foreigner's identification number that Spain uses for every tax and property transaction. A Spanish bank account follows, partly for paying the purchase and partly because utilities and local taxes are most easily settled by direct debit afterwards.
Once an offer is accepted, it is common to sign a private purchase contract and pay a deposit, frequently around 10%, with the balance due at the notary. Your lawyer will explain the terms. Under the most common form, the penitential deposit described in article 1454 of the Civil Code, a buyer who withdraws loses that deposit, while a seller who withdraws returns it doubled. One further detail catches out many: if the seller is a non-resident, article 25.2 of the Non-Residents' Income Tax Act requires the buyer to withhold 3% of the agreed price and pay it to the Spanish tax authority on the seller's account, using form Modelo 211. Your lawyer handles this, but it is worth knowing the money in your transfer will not all go to the seller.
If you are borrowing
Spanish banks lend to non-residents, though usually at lower loan-to-value levels than for residents, and they will want a valuation by an approved valuer, which the buyer pays for. Under the mortgage credit law, Ley 5/2019, the lender pays the notary fees for the mortgage deed, the registration of the mortgage and the gestoría, while the borrower pays for the valuation. Any arrangement fees vary by bank and should be compared carefully. A mortgage broker or your lawyer can lay the offers side by side, and the clearer that picture, the cleaner your total budget.
Putting it together: two illustrative budgets
These are simple arithmetic illustrations on a purchase price of €800,000, not quotations, and they exclude any mortgage costs.
- Resale at €800,000 — ITP at 7% (€56,000) plus notary, registry and legal fees at roughly 1–1.5% (€8,000–12,000). Total costs of roughly €64,000–68,000, or about 8–8.5% on top of the price.
- New-build at €800,000 — VAT at 10% (€80,000), AJD at 1.2% (€9,600) and notary, registry and legal fees at roughly 1–1.5% (€8,000–12,000). Total costs of roughly €97,600–101,600, or about 12.2–12.7% on top of the price.
The gap is real, but so is what a new-build often offers in return: modern specification, energy efficiency and, typically, years before major maintenance is needed. The right answer depends on the home, not the tax rate alone.
After the keys: the running costs
The purchase is a single event; ownership is a rhythm. Every year there is IBI, the municipal property tax, set by each town hall on the property's cadastral value, and a local refuse collection charge. Homes in a gated urbanisation or apartment building carry community fees, which can vary greatly depending on gardens, pools and security. Non-resident owners also file an annual Spanish non-resident income tax return, Modelo 210, on the property, whether or not it is let, and any rental income is declared on the same form. Add home insurance and utilities, and you have the true annual cost of a life by the sea. Asking for the latest IBI receipt and community fee statement before you commit is one of the simplest, most revealing questions a buyer can ask.
Where you buy shapes the numbers
Because the percentages are fixed, location is where budgets really diverge. The same 7% reads very differently on a frontline apartment along Marbella's Golden Mile than on a townhouse in a quieter pueblo inland. Our Marbella area guide explores the coast's most established address, while the Estepona area guide looks at a town where many new developments have been rising in recent years, which brings the VAT-and-AJD route into sharp focus.
A considered next step
Numbers are easier with a person beside you. At Beyond Blue, we work online but never at arm's length: we can build a cost breakdown around the specific home you are considering, resale or new-build, and introduce you to independent lawyers who will see the purchase through from first thought to front door. Browse our current Costa del Sol property for sale, tell us the area and price bracket you have in mind, and we will come back with a hand-picked shortlist and the real all-in figure for each.
