Change in mortgage tax – Earlier this year, the Spanish Government introduced a change in taxes which will finally help to reduce the amount of tax payable by expat property buyers by up to 2%. There has never been a better time to invest in the Spanish property market!
Previously expat buyers were accountable for mortgage tax but the new rule enforced earlier on in 2018, means that mortgage tax will now be paid by the Spanish bank financing the mortgage. This is a welcome change for all expats looking to finance their property purchase with mortgages issued by Spanish banks.
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Previously expatriates purchasing Spanish properties would pay over the odds in mortgage taxe when buying their homes in Spain. The cost of purchasing Spanish property including legal and taxation costs often amounted to over 10% of the actual property price.
Since 2014, the property market has recovered consistently since the 2008 crash. The market has seen a 15% increase on properties being sold since 2017 totalling over 450,000 properties sold in the region.
In 2018, house prices across the whole of Spain are expected to rise by around 5% according to Spanish bank BBVA. Rental prices are also reaching record-highs in major cities such as Barcelona, Palma and Madrid.
This change in mortgage tax couldn’t come at a better time, with expat buyers increasing even with looming Brexit fear.
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