How much I need to buy a house in Spain
The short answer is between 28% and 33% of the price, in cash and before you sign. The long one explains where each point comes from, why it changes depending on where you buy, and what to do if you are not there yet.
The short answer is between 28% and 33% of the price, in cash and before you sign. The long one explains where each point comes from, why it changes depending on where you buy, and what to do if you are not there yet.
The short answer: between 28% and 33% of the price
Spanish banks finance at most 80% of the property's value, so the remaining 20% comes from you. On top of that come the taxes and transaction costs, which run from 8% to 13% depending on the autonomous community and on whether you are buying second-hand or new-build. For a 200,000 EUR home that is between 56,000 EUR and 66,000 EUR in cash, available before you sign. This is not the monthly payment: it is the money you have to have in the account that day.
- 20% deposit, because financing goes up to 80%
- Another 8% to 13% in taxes and costs
- A 200,000 EUR home asks for between 56,000 EUR and 66,000 EUR
Where each point of those costs comes from
The bulk is tax. On a second-hand home you pay the ITP (impuesto de transmisiones patrimoniales, the transfer tax), set by each autonomous community, from 6% in Madrid, Navarre, Ceuta and Melilla up to the top bands of 13% in Catalonia or the Balearics. On a new build there is no ITP: you pay 10% VAT plus AJD (stamp duty on documented legal acts). And then, in both cases, notary, land registry, administrative agent and valuation, which together come to around another 2%.
- Second-hand: ITP from 6% to 13% depending on your community
- New build: 10% VAT plus stamp duty (AJD)
- Notary, registry, agent and valuation: around 2%
Almost every community has reduced rates, and almost nobody looks
The percentages above are the general rates, but practically every community applies reductions that can knock several points off: for being under 35, for large families, for disability, for buying protected housing (VPO) or for buying in a municipality at risk of depopulation. The conditions and price limits vary from one community to another and are changed fairly often, so it is worth checking your own community's tax website before taking any figure as read: on a 200,000 EUR home, three points of difference is 6,000 EUR.
- Common reductions for age, large families or disability
- They usually have price and income limits: check yours
- Three points of ITP on a 200,000 EUR house is 6,000 EUR
The most expensive mistake: emptying your buffer for the deposit
Plenty of people scrape together exactly the deposit and the costs, put it all on the table and move in with a zero balance. It is the most fragile moment possible: you have just taken on a thirty-year mortgage and a house that, if it is second-hand, almost certainly needs something. A breakdown, a building levy or one weak month of income turns straight into card debt. The purchase money has to be money on top of your emergency fund, not instead of it.
- Add your emergency fund on top of the purchase money
- Set aside for the move, furniture and the first year's repairs
- If buying leaves you at zero, you cannot afford it yet
The costs that show up after the keys
The mortgage payment is not the only thing that changes in your budget. From the day you sign you pay IBI (the council property tax), the community of owners' fee, home insurance — which the bank will require — and the maintenance the landlord used to handle. On a normal flat that easily adds between 100 EUR and 250 EUR a month that did not exist when you rented. If you do the sums with the mortgage payment alone, you will come up short in exactly the first year, which is when you have least room.
- IBI, community fees and home insurance, every month
- Maintenance becomes yours: boiler, damp, appliances
- Count on 100 EUR to 250 EUR a month on top of the payment
What to do if you are not there yet
You have three levers and it is worth ordering them. The first is lowering the target: the price you can pay depends on your savings, so a home 15% cheaper brings the finish line more than a year closer. The second is clearing debt: every payment you cancel raises what the bank will lend you and frees up money to save. The third is time, the only one that does not hurt but that requires knowing how much you can really set aside each month — and here almost everyone overestimates, because they calculate from a good month.
- Lower the target before straining the budget
- Clearing expensive debt raises your capacity and your saving at the same time
- Work out your monthly saving from your real spending, not from a good month
Frequently asked questions
Can I buy without having the 20% deposit?
It is possible but difficult, and it comes out more expensive. Some lenders finance above 80% for very specific profiles — civil servants, high and stable income, guarantors — or when the property is from their own repossessed portfolio, but they usually make up for it with a worse rate or tied products. There are also public guarantee schemes for young buyers, with conditions and limits that vary by community. Planning on 80% is the prudent approach; if a better option turns up, all the better.
Can the costs be rolled into the mortgage?
As a general rule no: the bank calculates the loan on the valuation or purchase price, not on the taxes. That is why the costs have to be in cash. There are occasional exceptions, but it is best not to count on them when doing your sums, because if they do not materialise you end up unable to sign with the house already chosen.
What happens if the valuation comes in below the sale price?
The bank lends on the valuation, not on what you agreed to pay. If you buy for 200,000 EUR and it is valued at 185,000 EUR, the 80% is calculated on the 185,000 EUR, so you would have to put the difference in from your own pocket, on top of the deposit. It is one of the most common reasons a purchase falls through at the last minute, and why it is worth leaving yourself a margin rather than scraping to the last euro.
Is new build or second-hand better for tax?
It depends where you buy. VAT on new builds is 10% across Spain, so in communities with low ITP, such as Madrid or Navarre, second-hand works out cheaper in tax terms. In communities with high ITP the opposite can be true. And there is another, less obvious factor: new builds are usually handed over later, which gives you extra months to keep saving, but also obliges you to make staged payments during construction.
How long does it take to gather that amount?
It depends entirely on your real savings capacity, which almost nobody knows precisely. If you save 500 EUR a month, gathering 60,000 EUR is ten years; if you save 900 EUR, a little over five. Before setting yourself a deadline, work out how much you can really set aside by looking at your last few months of transactions, not at what you think you spend. The gap between those two figures is usually several hundred euros.
How much should be left over after paying the mortgage?
The bank's benchmark is that your payments do not exceed 35% of your net income, but that is their limit, not yours. A more useful criterion: after the payment, the IBI, the community fee and the insurance, you should still be able to save something each month. If the mortgage leaves you at exactly zero, technically you can afford it and in practice you will live under strain for thirty years.
The figure is big. The plan to get there, not so much
Knowing you need 60,000 EUR is frightening until you divide it by the months you have left. mPF works out how much you can really set aside each month from your real spending and shows you how far along the goal you are, without you writing anything down.
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