How much does it cost to buy a home in the Balearic Islands?
As a non-resident buying a resale home in the Balearic Islands, plan on paying roughly 10% of the purchase price on top of the price itself. Nearly all of that is tax. The notary, the Land Registry and your own advisers make up only a small part of the bill.
Transfer tax on resale homes
If you buy from a private seller rather than a developer, the main cost is the Balearic transfer tax, ITP (Impuesto sobre Transmisiones Patrimoniales). It is collected by the Balearic Tax Agency (ATIB) and is the largest cost of the purchase. At the time of writing (September 2026), the rate rises through five bands:
| Part of the value | Rate on that part |
|---|---|
| Up to €400,000 | 8% |
| €400,000 to €600,000 | 9% |
| €600,000 to €1,000,000 | 10% |
| €1,000,000 to €2,000,000 | 12% |
| Over €2,000,000 | 13% |
A €750,000 home is not taxed at a flat 10%. Each slice of the value is taxed at its own rate and the amounts are added up. That total is turned into an average rate, to two decimal places, which is then applied to the whole taxable value. This is why your notary's figure can differ by a few tens of euros from an online estimate.
ITP is paid on form 600 within one month of signing the deed. Your lawyer or the notary's gestoría usually files it, but the duty is yours.
You may see Balearic rates of 4%, 2% or 0% advertised. All of them require the home to become the buyer's main residence and its value to stay under a low limit. A non-resident's holiday home always pays the standard bands.
The Catastro reference value sets a floor
Since January 2022, ITP has not always been based on what you pay. The Catastro, Spain's property survey office (not the Land Registry), gives every property a reference value, the valor de referencia. Tax is charged on the reference value or the deed price, whichever is higher.
Pay less than the reference value and you are taxed on money you never spent, which happens more than people expect with older rural houses. Ask your lawyer to check the reference value on the Catastro's online portal before you sign a reservation, and if it is above the agreed price, build the extra tax into your offer. The reference value only matters for resale homes.
New builds: VAT and stamp duty
A newly built home bought direct from the developer carries no transfer tax. Instead you pay:
- VAT (IVA) at 10% of the contract price, paid to the developer with the price.
- Stamp duty (AJD) on the deed at 1.5%, or 2% if the property is worth €1,000,000 or more. It is a Balearic tax due within one month of signing, like ITP.
Reduced stamp duty rates are for residents buying a main home. A home also counts as new only on its first sale by the developer. Buy it from the first owner and the resale bands apply.
Notary, Land Registry and lawyer
Notary and Land Registry fees follow official scales and are the same across Spain.
- Notary: the scale's rate falls as the price rises. On a €750,000 home the base fee is about €575, before copies, pages and 21% VAT.
- Land Registry: registration protects your ownership against third parties. On a €750,000 home it is about €320 plus VAT, and never more than roughly €2,200 whatever the value.
- Lawyer: fees are freely agreed, commonly around 1% of the price plus VAT in the islands, often with a minimum. Get a written quote showing what is included and whether the NIE, power of attorney or military permit cost extra.
Buying from a non-resident seller
If the seller does not live in Spain, you must keep back 3% of the deed price and pay it to the Spanish tax agency for them, on form 211, within one month of signing. This comes out of the price and is not an extra cost to you. The seller reclaims any excess through their own non-resident tax return. If you fail to pay it, the tax office can recover it from the home you have just bought, so it belongs in the private contract and the completion statement from the start.
The town hall can also claim the seller's municipal gains tax (plusvalía municipal) from you. It is due within 30 working days of the sale, so ask your lawyer to estimate it and withhold that too.
A worked example at €750,000
Take a €750,000 resale villa bought from a non-resident seller, with the reference value below the price and professional fees left out:
- Transfer tax: €32,000 + €18,000 + €15,000 across the bands, an average rate of 8.67%, giving €65,025.
- Notary and Land Registry base fees, before VAT and copies: €893.
- Total taxes and fees: €65,918.
- Withheld for the seller's tax: €22,500, part of the price rather than a cost.
As a new build, the same home would carry €75,000 of VAT, €11,250 of stamp duty and the same €893 in fees, a total of €87,143. You can try your own figures with the free calculator.
More detail in the book. Chapters 3 and 6 of Buying a Home in the Balearic Islands as a Non-Resident cover this with worked examples, deadlines and the risks behind the figures.
General information based on the rules in force in September 2026, not legal or tax advice. Rules change often: check your own case with an independent Spanish lawyer or tax adviser before you act.
Related: Buying a country house on rural land in the Balearics · What does a non-resident pay each year on a Balearic home?