If you’re thinking of investing in a property in Spain, and wondering whether it is the right financial decision for you then you might ask the question “how much does it cost to maintain a property in Spain?” There is no exact answer or precise figure to give for this question, but by having an idea of ongoing costs and what to expect, you’ll be better placed to plan for your Spanish property purchase.
The real costs of maintaining a property in Spain will vary on a few things. These include the size of the property, whether you are living in your Spanish home or hiring a property maintenance company to take care of the maintenance of your new home for you. To help give you an idea of the annual costs of owning a home in Spain, here is a breakdown of the charges and fees that you can expect to pay:
It doesn’t matter whether you live permanently in Spain or are a foreigner investing in a holiday home, all owners of Spanish properties will have to pay certain taxes. The first ongoing cost will be IBI (Impuesto sobre Bienes Inmuebles) which is a tax that you pay to your local Town Hall, it roughly translates as ‘Council Tax’ for those in the UK. IBI tax covers the cost of waste collection, infrastructure and other local services. It is payable annually, and you will be subject to financial penalty if you pay your IBI tax late.
Depending on where you live, you can either pay this tax online or you will have to visit your local Town Hall to make payment: each region is different. The IBI rate is also set regionally, meaning the amount you pay will differ depending on whether you live. The amount you will pay is based on your Valor Catastral: the official and registered value of your property. To give you an idea of what you can expect to pay, the IBI of an apartment in Barcelona is 0.6% of the value of the property. In reality, the IBI tax can be between €400 per year for a two-bedroom apartment on the Costa Del Sol, going up to €1500 - €2000 per year for a luxury villa in a more expensive area like Marbella.
Note: You must pay IBI tax regardless of whether you are living in your property or not.
The amount you will spend on State Tax depends on whether you are renting your property or living in in yourself. If you are a non-resident and renting your property out then you must file and pay tax on the rental value of your property in quarterly periods: the state tax for a rented property in Spain is set at 19% of its rental value.
If you are not renting your property out then you will only have to file for your State Tax yearly, and the rate for this is considerably lower: 0.2% in Barcelona.
When you buy a house in Spain, you are strongly advised to secure both building insurance and contents insurance, and this will be another ongoing maintenance cost to consider. If you used a mortgage in order to buy your property then ensuring that the property is protected with adequate building insurance is often a condition of the mortgage offer. You can expect to pay around 0.05% of the purchase price of your property for your annual insurance, typical prices hover between €250-350 per year for the Costa Del Sol.
Of course, with the soaring cost of energy prices, it would be impossible to discuss how much it costs to maintain a property in Spain without mentioning utility bills. The amount your utility bills will cost will depend on the size of your property, whether or not it is occupied or left empty, and you should note that the monthly utility bills will also be higher for a rented apartment.
Even if your property is vacant, you will still have monthly costs of owning a home in Spain for your utilities, simply to keep the accounts open. For that same apartment in Barcelona that we are using as our example property, these will be approximately €15/month for water, €20/month for electricity, and €6/month for gas. If the apartment is rented, these charges could increase to as much as €150/200 per month, and it’s worth noting that inflation and utility costs are on the rise, so these numbers are only going to go up throughout 2022.
If the property you have purchased is in a community (often these are gated communities or apartment complexes) then you may be liable for community charges in order to pay for the maintenance and upkeep of your community. These charges vary considerably depending on the services offered within your community, but you should agree to this figure before you purchase your property, so your community charges shouldn’t be a surprise. For an average Spanish apartment, you can expect your community charges to be between €50 and €100 per month: for a larger property, or one with extensive community perks and benefits, this rate could be much higher.
Other Charges to Consider
Other charges to consider will depend on the facilities you have in your property: the needs of each property will be different. If you own your own pool, for example, then pool heating and maintenance costs should be considered. The costs of maintaining a garden may be a factor is you have your own outside space. The costs of exterior paintwork and interior decoration should also be considered if you haven’t purchased a brand-new property. A good rule of thumb is to make a list of everything that you think you will have to maintain or update on both a monthly an annual basis, in order to calculate the real costs of these additional charges.
How Much Does It Cost to Maintain a Property in Spain?
To sum up, you can expect to pay the following charges in order to maintain a property in Spain, although you should be aware that these figures are approximate, and don’t replace doing your own research for your individual property needs:
- 0.15% Local tax,
- 0.05% National tax
- 0.05% Insurance
- 0.1% Utilities (for an empty property)
- 0.3% Community charges
- 0.1% Property charges
Are you in the process of looking for a property to buy in Spain? If you’re looking for estate agents on the Costa Del Sol then why not get in touch ? Our locally based property experts are a font of local knowledge, and are perfectly placed to help you find the home of your dreams.