A new tax reduction is set to make buying a resale property in Andalucía more affordable, with further reductions planned over the coming years.
The Junta de Andalucía has announced plans to reduce the general rate of Property Transfer Tax (Impuesto de Transmisiones Patrimoniales, or ITP) from 7% to 6.75% from 2027. The measure forms part of a wider commitment to gradually reduce the tax to 6% by the end of the current legislative period, with the rate intended to fall by a further quarter of a percentage point each year.
For buyers considering a property in Marbella, Nueva Andalucía, Estepona, Benahavís or elsewhere along the Costa del Sol, the announcement represents another change to consider when calculating the overall cost of a purchase.
What Is Changing?
At present, the general ITP rate for the purchase of a resale property in Andalucía is 7%. Under the proposed 2027 budget measures, this will fall to 6.75%.
The Junta has estimated that almost 147,000 people could benefit from the announced tax changes, with around 138,000 expected to benefit specifically from the reduction in the general rate.
The planned reduction is part of a longer-term commitment to bring the general rate down to 6%, with annual reductions of 0.25 percentage points.
Planned ITP Reduction
Current rate: 7%
2027: 6.75%
Following annual reductions: 6.5%, then 6.25%
Target rate: 6%
The exact application of future reductions will depend on the relevant annual budgets and legislation.
Higher Price Limits For Reduced Rates
The changes are not limited to the general ITP rate.
The Junta has also announced an increase in the property value threshold for certain reduced rates. The current €150,000 limit will rise to €200,000 for the 6% reduced rate applicable to qualifying purchases of a main residence.
The threshold for the 3.5% super-reduced rate will also increase from €150,000 to €200,000 for qualifying groups, including buyers under 35 and certain other categories.
For buyers with a recognised disability or members of large families, the property value threshold will rise to €300,000.
These reduced rates are subject to specific eligibility requirements, so buyers should confirm their individual circumstances before relying on a reduced rate.
What Does This Mean For Property Buyers?
The reduction may appear modest as a percentage, but on a high-value property even a small change in the tax rate can translate into a meaningful saving.
For example, on a €1,000,000 resale property, a 7% ITP rate would represent €70,000 in tax. At 6.75%, the amount would be €67,500 — a difference of €2,500.
On a €2,000,000 property, the difference would be €5,000.
The planned reduction towards 6% would create a larger difference over time. At 6%, ITP on a €1,000,000 property would amount to €60,000, compared with €70,000 at the current 7% rate.
Of course, ITP is only one part of the total cost of purchasing property in Andalucía. Buyers should also account for legal fees, notary and registration costs, financing expenses where applicable, and other purchase-related costs.
Resale Properties vs New Developments
One important distinction is that ITP applies to the purchase of resale properties. New-build properties purchased from a developer are generally subject to VAT rather than ITP, meaning the announced ITP reduction does not apply in the same way to newly built homes.
This distinction is particularly relevant in Marbella and the Costa del Sol, where both established villas and apartments and newly developed residences form an important part of the property market.
A Changing Tax Landscape
The planned ITP reduction is part of a broader set of measures announced by the Junta aimed at improving access to housing and supporting property purchases in Andalucía. The regional government has also highlighted measures relating to first-home guarantees and increasing the supply of affordable housing.
For property buyers, the key takeaway is straightforward: from 2027, the general ITP rate for qualifying resale property purchases is planned to fall from 7% to 6.75%, with further reductions planned towards 6%.
As always, buyers should obtain up-to-date legal and tax advice before completing a purchase, as the applicable tax rate can depend on the type of property, its value and the buyer’s individual circumstances.
