Costs of Buying a New-Build Property in Andalucía
A practical guide to IVA, AJD, staged payments and the additional costs involved when purchasing a new property on the Costa del Sol.
Request a personal cost estimateIVA on the purchase price of a new residential property
AJD generally payable on the notarised new-build purchase
General rates for guidance. Exact treatment can depend on the property, transaction and buyer’s circumstances.
How Is a New-Build Purchase Taxed?
When a newly constructed home is purchased directly from a developer, the transaction is generally subject to IVA rather than the ITP charged on a normal resale purchase.
IVA
The general IVA rate for a new residential property is currently 10%. It is normally paid to the developer alongside the relevant purchase payments.
AJD
The notarised purchase is also generally subject to Actos Jurídicos Documentados. The general AJD rate in Andalucía is currently 1.2%.
Which Costs Should You Include?
The developer’s advertised price is only the starting point. Include the following items in your total budget.
IVA
Generally 10% of the purchase price for a new residential property.
AJD
Stamp Duty generally charged at 1.2% in Andalucía.
Independent Legal Fees
For contract review, legal checks, payments, completion and registration.
Notary & Registry
For the title deed and registration of your ownership after completion.
Mortgage Costs
These may include valuation, advice and separately agreed bank expenses.
Extras & Connections
Upgrades, utility connections, snagging, furniture and administrative services.
Estimated New-Build Purchase Costs
These examples show the main taxes and an estimated allowance for other usual purchase costs.
| Purchase price | IVA 10% | AJD 1.2% | Other estimated costs | Estimated total |
|---|---|---|---|---|
| €300,000 | €30,000 | €3,600 | €6,000–€9,000 | €339,600–€342,600 |
| €500,000 | €50,000 | €6,000 | €10,000–€15,000 | €566,000–€571,000 |
| €1,000,000 | €100,000 | €12,000 | €15,000–€25,000 | €1,127,000–€1,137,000 |
Illustrative estimates only. Options, furniture, mortgage financing and ongoing ownership costs are excluded.
How Do Staged Payments Work?
The exact schedule is set out in the contract. A typical new-build purchase may include these stages.
Reservation
An initial payment reserves the chosen property.
Private Contract
A larger percentage is paid when the private contract is signed.
Construction
Further instalments may be due at agreed building milestones.
Completion
The outstanding balance is paid when the title deed is signed.
Registration
AJD and other costs are settled and ownership is registered.
Bank Guarantees for Off-Plan Purchases
Payments made before construction is completed should receive the legal protection applicable to advance payments for new housing. This is commonly provided through an individual bank guarantee or insurance guarantee.
Each protected payment should be traceable to the designated account and supported by the relevant documentation.
What Should Be Verified?
Independent checks remain essential even when buying directly from a recognised developer.
Developer and Land Ownership
Confirm the developer, registered landowner and authority to build and sell the project.
Planning and Building Licence
Verify the planning position, building licence and approved project documentation.
Contract and Specifications
Check the payment schedule, completion terms, plans, finishes and agreed extras.
Guarantees
Confirm protection for advance payments and the building warranties available after completion.
Completion Documentation
Review the completion, occupancy and administrative documents required for lawful use.
Community and Ongoing Costs
Request estimates for community fees, IBI, utilities and the maintenance of shared facilities.
Snagging and Completion
Before or around completion, the property should be inspected against the plans, specifications and agreed finishes. A snagging inspection records visible defects and incomplete work for the developer to address.
Buyers should also confirm practical arrangements such as keys, meters, utility contracts, community administration and the handover of manuals and warranties.
New-Build Buying Costs Explained
Do I pay ITP on a new-build property?
A normal first purchase of a completed new home directly from a developer is generally subject to IVA and AJD rather than ITP.
Is IVA included in the advertised price?
Not always. Marketing prices are frequently shown before taxes and additional costs. Confirm in writing whether IVA is included or payable on top.
When is IVA paid?
IVA is normally paid alongside each taxable payment to the developer, including staged payments, with the remaining balance settled at completion.
Are off-plan payments guaranteed?
Advance payments should receive the applicable legal protection, but every guarantee and payment should be independently checked before money is transferred.
Is the expected completion date guaranteed?
The contract should define the expected date, permitted extensions and consequences of delay. Your lawyer should review these clauses before signing.
Are furniture and upgrades included in the buying costs?
No. Furniture, optional upgrades, interior design and additional installations should be budgeted separately unless expressly included in the purchase contract.
Download the Andalucía Buying Costs Checklist
A practical checklist covering taxes, payment stages, guarantees, completion documents and professional costs.
Understand Every Payment Before You Commit
O’live can help you compare new developments, understand the payment schedule and prepare an initial overview of the expected purchase costs, with independent legal and financial specialists confirming the final figures.