Calculating the cost
You perhaps have in mind exactly what you would like your ideal property in Spain to look like, where it should be situated and the dimensions and specifications it should include. Trouble is, one doesn’t seem to have been built yet. The solution? Build one of your own.
There are clear advantages in taking control, including removing the profit of the agent and avoiding some of the risks associated with buying from one. However, building your own property in Spain comes with risks of its own and you need to calculate your budget carefully.
Calculating the cost
Although the majority of costs lie within purchasing the plot and the building work itself, there are other costs which are very easily forgotten about.
Please find a summary of the total costs involved in building your home below:
- Purchasing the plot: This depends on the m² pricing of the area.
- Building work: We recommend you talk to your architect about the prices, as it can vary depending on the material used.
- Professional fees: Make sure you discuss the fees with your architect and the solicitor, depending on the type of project.
- Taxes and licences: Double-check the costs with your town hall.
It is important that you select your site carefully. It might sound obvious, but it is crucial that you check with the local municipality in Spain, that you have the permission to build and what restrictions there might be, in terms of dimensions of the building.
You need to consider your utilities too. Is your plot accessible from a public road? Are services available including water supply, sewage and electricity?
On top of the building costs and the price of the plot, you must add the costs of the deed of sale, notary fees and registration in the Land Registry in Spain. This usually comes to around 1% of the purchase price.
The transfer tax is 10% and if you are a company you will have to pay 21% in VAT (IVA). There is also a VAT charge on the building work, which amounts to around 10% of the contract budget. VAT also applies to architects’, technicians’ and builders’ fees all at a rate of 21%.
Making sure it’s legal
However expert you feel you may be, engaging an architect in Spain is essential. You must have the correct licences to go ahead and apply for provisional water and electricity supply whilst the property is being built.
It might sound like an obstacle race to construct your own home and it’s certainly not for the faint-hearted, but it could still be a cheaper way to ensure that you get exactly what you have dreamed of.
Hire experts in conveyancing and property law that can be with you at every step of the way to make your new home legal. Having put in so much blood, sweat and tears into its construction, the last thing you want is to be told it’s got to come down.