If you’re considering buying property in Spain, one of the most common questions is: Do I have to pay annual property taxes? The answer is yes, but the good news is that Spain’s property tax system is far more affordable than in many other countries.
What is IBI? Spain’s Annual Property Tax
Spain’s annual property tax is called IBI (Impuesto sobre Bienes Inmuebles). This tax is similar to property tax in the U.S. or council tax in the U.K. and is paid to the local town hall (Ayuntamiento). The cost of IBI varies based on location, property value, and municipal tax rates, but here’s a general breakdown:
- ? 2-bed, 2-bath apartment: Around €500 per year
- ? Larger villa: Between €1,000 – €1,500 per year
- ? Luxury properties with extensive land: Up to €2,500 per year
How Does Spain’s Property Tax Compare to Other Countries?
For context, property tax rates in the U.S. can be as high as 2% of a home’s value—meaning a $500,000 property could cost $10,000 per year in taxes. In contrast, property taxes in Spain are much more manageable, making it an attractive destination for expats, retirees, and property investors.
Other Costs to Consider When Owning Property in Spain
In addition to IBI, homeowners in Spain should also budget for:
✅ Basura Tax (Waste Collection Fee) – Typically €100-€200 per year
✅ Community Fees (for apartments or gated communities) – Varies based on amenities
✅ Non-Resident Property Tax (if you don’t live in Spain full-time)
Thinking About Buying Property in Spain?
Whether you’re a first-time buyer or an experienced investor, understanding Spain’s property taxes is essential for making informed decisions. If you have any questions about property ownership costs in Spain, feel free to contact us—we’re here to help!