How much it costs to buy a home in Madrid: taxes and fees (2026)
When you buy a home, the purchase price is not the only outlay. It is wise to set aside an additional 7% to 8% of the price for taxes and transaction costs. Knowing this in advance avoids surprises at signing.
On a resale home, set aside 7% to 8% of the price for taxes and fees.
Second-hand homes: transfer tax (ITP)
Buying a resale home means paying Transfer Tax (ITP). In the Region of Madrid the general rate is 6%, one of the lowest in Spain. It must be paid within 30 working days of signing the deed before a notary.
New-build: VAT plus stamp duty
For a new-build home, instead of ITP you pay VAT (10% on housing) and Stamp Duty (AJD), which in Madrid is 0.75%.
Notary, Registry and other costs
On top of taxes come notary and Land Registry fees, set by official scales and identical across Spain, calculated on the declared price. If there is a mortgage, add the valuation; and, optionally, the agency that handles the paperwork.
An example at the top end
On a 1,200,000 € resale home, the 6% ITP alone is 72,000 €, plus notary, registry and agency. Budgeting 7–8% of the total price is a prudent rule for this segment.
There are reductions —for example, a 4% ITP for buyers under 35 on a main home below 250,000 €— that do not apply to prime property, but it is worth knowing the full picture before buying.
This article is informational and does not constitute tax or legal advice. Every transaction is different; consult a professional before deciding.