Great news! Transfer Tax and stamp duty have both now been reduced for property in Sotogrande
If you are among the many people who have spent much of the coronavirus pandemic browsing a lot of the excellent property Sotogrande has to offer, only to hesitate to take action to make your dream a reality, we have some encouraging news to share with you.
As confirmed by the Boletín Oficial de la Junta de Andalucía, or BOJA – the official gazette of the Junta de Andalucía – property transactions in the autonomous community, including in Sotogrande, will be subject to reductions in both Transfer Tax and stamp duty.
While Transfer Tax in the region is being lowered from the previous rate of between 8% and 10% to a fixed 7%, stamp duty is going down from 1.5% to 1.2%. Both of these measures – designed to help stimulate the local property market and tempt would-be buyers – will remain valid until 31st December 2021.
Stamp duty is known in Spain as Actos Jurídicos Documentados, or AJD, and is paid by the buyer of a newly-built home. Meanwhile, Transfer Tax is referred to as Impuesto sobre Transmisiones Patrimoniales (ITP), and its payment is the responsibility of a buyer when the property under acquisition is deemed to be a second-hand or resale home.
What else do we know about the alterations to these charges?
The Spanish-language bulletin explained of the background of the changes, as translated into English: “Since the declaration of the COVID-19 pandemic by the World Health Organization, the Governing Council of the Junta de Andalucía has been gradually adopting a series of measures of a different nature aimed at mitigating the serious effects that it is producing in the Autonomous Community of Andalucía.”
The document highlighted a decree-law that came into force on 17th March, and which contained “financial and tax support measures to the economic sector, streamlining administrative actions and social emergency measures, to fight against the effects of the evolution of the coronavirus (COVID-19)”.
The gazette continued: “With exclusive validity until December 31, 2021, the levy of the Tax on Patrimonial Transmissions and Documented Legal Acts is reduced in order to promote the economic boost and reactivation of the Autonomous Community of Andalucía.
“Specifically, in the Onerous Patrimonial Transfers modality, the general tax rate applicable to the transfer of real estate and the constitution and alignment of real rights over them is reduced, except those of guarantee, going from the rates of 8%, 9% and 10% to a single general rate of 7%.
“In the same way, the general tax rate is reduced, the Documented Legal Acts modality, for notarial documents, going from the tax rate of 1.5% to the tax rate of 1.2%.”
There might have never been a better time to get into Sotogrande property
Does the above seem like a bold claim to you? Here at BM Sotogrande, we can understand why. However, it is also often said that in times of uncertainty and difficulty, lies opportunity – and we’re certainly convinced that this can be said of the COVID-19 pandemic.
After all, as the BOJA pointed out, last year ended with an approximately 17% decline in the number of homes sold in Andalucía – according to the National Institute of Statistics – and this was accompanied by a fall in prices, especially for resale properties.
This is helping to bring about some very attractive deals for housing on the Costa del Sol at the moment. However, such is the enduring popularity of property in this part of Spain, that this situation is unlikely to last forever.
Now, then, could be a great moment to act if you’re interested in some of the finest and best-value property Sotogrande has available. Reach out to BM Sotogrande’s experts today, and we’ll be delighted to advise and guide you on the possibilities.