MORE WOE'S IN THE HOUSING MARKET

In Spain, as in Britain, the buyer must pay sales tax on the property. This is known as Impuesto de Transmisiones Patrimoniales (ITP). It is paid as a percentage of the value of the house. The exact figure varies depending on what type of property is being bought and where it is in the country. (Bearing in mind that ALL properties were over valued back then). Now the tax authorities are combing through home sales dating back over the past four years and comparing the declared sales price to what they believe the real value is. If the house’s sale price does not match with the taxman’s own official valuation of the property, the owner is asked to pay the difference in stamp duty. In some cases this can run to thousands of pounds. The Spanish Government has ALREADY had the tax on the original purchase. This is definitely going to be an issue for prospective purchasers.