It's all very well knowing where your want to buy your property in Spain and how much to spend, but what about the running costs?
Once you’ve bought your new home, you’ll want to know what other recurring expenses you’ll have to pay for, apart from the obvious ones like electricity, water and internet.
Your running costs can be separated into three main categories:
1.Taxes
2. Community Fees
3. Utilities
Property Taxes
- IBI tax (Impuesto Sobre Bienes Inmuebles): The IBI is the "Impuesto sobre Bienes Inmuebles", which can be translated as "property tax". This is a municipally levied tax (similar to Council Tax in the UK) and varies widely from one municipality to another and from one type of property to another. It is worked out based on a percentage of the land value. In practice, this means paying anywhere between €400 per year for a two bedroom apartment up to between €1500 - €2000 per year for a luxury villa in an expensive neighbourhood.
- Basura Tax (Rubbish Collection Tax) - in some areas the cost of refuse collection is included with the IBI tax, in others it is a small separate charge of between only €80 to €130 per year.
- IRNR Non-resident income tax (Impuesto sobre la Renta de No Residentes): This is a yearly tax applicable to non-residents of Spain. Assuming that you don’t earn any sort of income from rent or anything else on Spanish territory, the tax will be calculated based on 24.75% of between 1-2% of the cadastral value. If the cadastral value of your home were 100,000 euro, for example, the IRNR would be 24.75% of 1%, that is, 247.50 euro per year. Of course, the exact value for you will depend on your house’s cadastral value, which you can find out from your lawyer or from the Land Registry Office.
Community Fees
Community fees (comunidad) pay for the maintenance of shared, communal spaces if you live in an urbanización, such as swimming pools, tennis courts, green spaces, stairwells and general cleaning costs. The budget is decided yearly by the owners’ association, which you have the right to be a part of, and is divided between all the neighbours who live there.
Think anywhere between 60 to 300 euros a month. The amount you will pay will be determined by two main factors - 1) how extensive are the services provided, so a community with 24 hour security guards, several swimming pools and gardens with ornate fountains etc. will be more costly than a more modest urbanización and 2) how many neighbours you have to share the cost.
Community fees will generally cover the following:
- Cleaning and maintenance of communal areas;
- Professional services (e.g. concierge, gardeners, pool cleaners, lifeguard etc.);
- Maintenance of elevators;
- Insurance for the communal elements;
- Painting of the outside and common areas of the building every few years
To calculate how much you pay as an individual owner, the square meterage of your property is taken into account. This is then applied as a percentage of the total area to give your share (cuota de participación in Spanish). Obviously, the larger the property, the higher the share and community fees. Your cuota de participación also determines your voting rights – owners of larger properties have a higher percentage of the vote.
Utilities
Electricity
The two main electricity companies are Grupo Endesa (the largest) and Iberdrola. Electricity is billed every two months, usually after meters have been read. However, companies are permitted to make an estimate of your consumption every second period without reading the meter so you should learn to read your electricity bill and check your consumption.
Paying your bills by direct debit from a Spanish bank account is the easiest way, alternatively, you can pay bills at a post office, local banks (listed on the bill) or at the electricity company’s office (in cash).
The amount of your bill will depend on your tariff and consumption. Electric bills for a two bedroom apartment should be around €40 per month whereas a larger villa could pay €100 per month. Note that if you use air conditioning in the hotter months, this can raise another thirty percent on average.
Gas
Mains gas is available only in major cities, and generally not available in the Costa del Sol.
Gas bottles (bombonas) can be delivered to your homes. A 12.5kg bottle costs around €12.50 (the price fluctuates frequently) when delivered to your home or less if purchased directly from a Butano depot. A bottle used just for cooking lasts an average family around six to eight weeks.
Water
Water cost is controlled by the local municipality. The amount you pay is metered and will depend on the area you are in and the amount of water you use. Part of the bill will be for the general upkeep of drainage, sewers, etc. Water bills for a two bedroom apartment should be around €15 per month whereas a larger villa with a garden to water and a private swimming pool could pay €120 per month.
Internet
High speed fibre-optic internet is generally available all over the Costa del Sol. There are several companies to choose from. Costs vary from €20 per month upwards depending on the speed contracted. Many companies offer packages which include international TV packages and phone calls which you can turn on and off on a monthly basis so you only pay for the months that you are using it.
