Every website about buying property in Spain will tell you about the 10% transfer tax. A few will mention solicitor fees. Almost none will give you a complete picture of what you’ll actually spend — from the moment you decide to buy to the moment your first tenant moves in.
I’ve pulled together figures from my own experience buying in the Alicante region in 2024-2025 and conversations with other buyers at different budget levels. Your numbers will vary — refurbishment costs especially depend on property condition, finish level, timeline, and your team on the ground. But this is as close to a real budget guide as I can give you.
A note on the proposed 100% tax on non-EU property buyers
If you’ve been researching buying in Spain recently you’ll have seen alarming headlines about a proposed 100% tax on property purchases by non-EU buyers — which includes UK citizens post-Brexit. Here’s what we actually know.
In January 2025 Prime Minister Sánchez proposed the measure as part of a housing affordability package. It was formally submitted to parliament in May 2025. As of early 2026 it has not been passed into law, and most legal and tax experts following the legislation believe it is unlikely to pass in its current form — it faces significant parliamentary opposition and would require coalition support that isn’t currently there.
That said, some form of additional purchase tax on non-EU buyers remains a real possibility. A more moderate surcharge — an additional 10–20% on top of the existing 10% ITP — is considered more likely if anything does pass.
What this means for UK buyers right now
UK buyers can still purchase property in Spain. The existing rules — 10% transfer tax, standard legal process — apply today.
However there is a structural point worth knowing: buyers purchasing through a Spanish company rather than personally may be in a different position entirely. Business purchases subject to VAT rather than ITP fall outside the scope of the proposed measure as currently drafted. This is one of several reasons — alongside tax efficiency and inheritance planning — why the company structure deserves serious consideration.
This is an evolving situation. I’ll update this article as the legislation develops. For the most current position always check with a qualified Spanish tax adviser before making any purchase decisions.
The Purchase
In the Alicante region you can find apartments starting around €60,000 for something that needs significant work, up to €300,000+ for a renovated property in a prime location. The range is wide because the market is wide — a two-bedroom flat in Elche will look very different from a sea-view apartment in Alicante city.
Budget also shapes what kind of investment you’re making. A buyer with €250,000 could pick up a three or four-bedroom flat needing modernisation and spend €50,000–€70,000 on refurbishment depending on spec and intended tenant profile. A luxury holiday let with premium finishes and standout features commands higher nightly rates but costs significantly more to create. A long-term rental aimed at professionals or students can be finished to a high visual standard for less — your tenant manages day-to-day wear themselves so the priority is durability and appeal rather than turnover-ready facilities. More on that decision in a separate post.
On top of the purchase price, budget for:
Transfer Tax (ITP) — fixed at 10% of the purchase price in the Comunidad Valenciana. No negotiation, no exceptions. On a €100,000 property that’s €10,000. Factor it in from day one.
Notary and Land Registry fees — typically €1,000–€2,000 depending on the complexity of the transaction.
Property sourcing fee — if you use a sourcing company to find and manage the purchase on your behalf, fees vary depending on the scope of service. For a full end-to-end service covering sourcing, legal liaison, refurbishment management, and initial rental setup, budget €6,000–€12,000. For that price you’re buying significant expertise and hand-holding — particularly valuable if you’re buying remotely from the UK.
Purchase cost summary (on a €100,000 property):
Property: €100,000
Transfer tax (10%): €10,000
Notary and registry: €1,000–€2,000
Sourcing/management fee: €6,000–€12,000
Total purchase costs: approximately €117,000–€124,000
Getting Set Up: NIE, Company, and Accountant
Before you can buy anything you need a NIE number — your Spanish tax identity. Without it nothing moves. I’ve covered the full NIE process in a separate post but for budgeting purposes:
Notary (power of attorney): ~€170
Solicitor fee (application, collection, sending): ~€450
NIE total: ~€620
This is a significant decision that deserves its own article — and I’ve written one. But for budgeting purposes, if you decide to buy through a Spanish company as I did, add the following setup costs:
Company formation via notary: €800–€2,900 depending on who you use and where. English-speaking solicitors, particularly those based in Valencia, tend to charge at the higher end. A Spanish-speaking firm on the ground in Alicante will typically come in significantly cheaper.
Power of attorney for a representative to sign on your behalf: ~€180 plus IVA. This should be a limited, task-specific power of attorney — scoped solely to the action you need completed, such as signing the property transfer documents. It should not grant open-ended financial powers. Ask your solicitor to specify the exact permitted actions in the document before you sign.
Virtual registered office address (mandatory — your company must have a Spanish address): €200–€250 per year.
Accountant fees: €80–€150 per month. This is a base retainer — similar to how UK solicitors charge disbursements, each submission to the tax office or Registro Mercantil typically adds to your bill. Budget for quarterly filings, annual corporate tax, and any one-off registrations on top of your monthly fee.
If you buy personally rather than through a company, your accounting costs are significantly lower — a straightforward annual non-resident tax return can be filed through online services for as little as €84, rising to €200–€400 per year if you have rental income to declare.
Setup cost summary (company purchase):
NIE: ~€620
Company formation: €800–€2,900
Power of attorney: ~€180
Virtual office (year one): €200–€250
Accountant (year one): €960–€1,800 plus disbursements
Total setup costs: approximately €2,760–€5,750
Refurbishment
Refurbishment costs in the Alicante region vary by property size, condition, and finish level. A useful way to budget is by square metre — for a full renovation to rental standard, expect approximately €300–€400 per sqm excluding IVA.
As a rough guide by property size:
50sqm (1-bed): €15,000–€20,000
75sqm (2-bed): €22,500–€30,000
100sqm (3-4 bed): €30,000–€40,000
All figures plus 21% IVA.
A full refurbishment typically covers: demolition and clearance, new flooring throughout, tiling, replastering and painting, replacement windows and doors, full rewiring, new plumbing and water heater, new bathrooms, and a fitted kitchen with appliances. Older buildings in the Alicante region frequently need electrical capacity upgrades too — worth factoring in early.
Budget for surprises
However detailed your quote, something unexpected will come up. A non-standard door frame that needs to be built from scratch. A council permit not included in the builder’s price — typically around €500. An electrical upgrade required by the building, not just the flat.
A sensible rule: add 10–15% contingency on top of any quote before you commit to a purchase price. If you don’t need it, great. If you do, you won’t be scrambling.
A note on IVA
Spanish construction quotes are subject to 21% IVA. Always check whether quotes are ex IVA or inc IVA before comparing — the difference on a €35,000 refurbishment is over €7,000.
Furnishing
Furnishing costs depend almost entirely on your rental model and target tenant. There are broadly two approaches:
Long-term rental — your tenant will live in the property and manage day-to-day wear themselves. The priority is durability, visual appeal, and good photography. You don’t need luxury finishes but you do need it to look clean, modern, and well thought through. Budget €5,000–€10,000 for a 3-4 bedroom flat furnished to this standard.
Premium or holiday let — higher nightly rates justify higher investment. Statement pieces, quality appliances, features that photograph well and justify the price point. Budget €15,000–€30,000+ depending on size and spec.
One thing worth doing yourself
However you furnish it, get the photography right before you list. Warm, bright, well-edited images make a significant difference to enquiry levels — especially if you’re managing the listing remotely and can’t be there to show people around in person. It’s worth spending time on this, or briefing whoever manages your listing very specifically on what you want.
Furnishing cost summary:
Long-term/serviced rental spec: €5,000–€10,000
Mid-range: €8,000–€15,000
Premium/holiday let: €15,000–€30,000+
Ongoing Annual Costs
Once the property is tenanted and running, your annual costs are predictable and manageable. Here’s what to budget for:
Monthly costs:
Building community fees: €15–€30/month depending on the building
Property management fee if using a local agent: typically 8–12% of monthly rent
Accountant retainer (company ownership): €80–€150/month plus disbursements
Annual costs:
IBI (Spanish council tax equivalent): €200–€350 depending on property value and location
Home insurance (building and landlord cover): €150–€300/year. Basic building-only cover starts lower, but for a furnished rental property with tenants you’ll want landlord cover that includes contents and liability. Shop around — English-speaking brokers are available in the Alicante region and worth using for a first policy.
Rubbish collection tax (tasa de basuras): €40–€60/year
Virtual office (if buying through a company): €200–€250/year
A note on utilities and rental model
For long-term rentals, tenants typically take on utilities in their own name — standard practice in Spain that removes a variable from your monthly costs.
I took a different approach. The flat is let as a serviced rental on maximum 11-month contracts. This is a deliberate commercial decision: in Spain, tenants who remain beyond certain contract thresholds can acquire legal staying rights that are difficult and costly to unwind — unpaid rent situations can become protracted legal battles. Capping contracts at 11 months avoids this entirely.
Keeping utilities in the company name also makes practical sense when letting by the room. There’s no changeover stress when a tenant moves in or out — no bills to transfer, no new accounts to open. Internet is particularly worth controlling yourself: installing a new connection requires engineers to drill through walls, and you want that done once, properly, on your terms. With utilities in your name you have full visibility of the property’s debt position and can ensure everything is paid on time, every time.
The trade-off is that utilities become part of your monthly costs rather than the tenant’s. Factor €150–€250/month into your numbers if you take this approach, offset partially by the ability to price it into your room or flat rate.
Annual cost summary (company ownership, serviced rental):
Property management: €1,300–€1,960/year
Accountant: €960–€1,800/year plus disbursements
IBI: €200–€350
Insurance: €150–€300
Virtual office: €200–€250
Rubbish tax: €40–€60
Total ongoing annual costs: approximately €2,850–€4,720
What Can You Expect to Earn?
Rental yields in the Alicante region vary depending on location, property size, rental model, and how well the property is managed and marketed. Here’s an honest picture.
Gross yield — annual rental income divided by purchase price — typically runs at 8–12% for well-located properties in the Alicante region bought at the right price. This is the number agents and sourcing companies will quote you. It looks attractive. It is attractive — but it’s not what lands in your account.
Net yield — after all running costs — is the number that matters. Realistically budget for 4–6% net on a well-run property. On a €100,000 purchase that’s €4,000–€6,000 per year, or €330–€500 per month.
On a higher budget purchase of €150,000–€160,000 all in — covering purchase, setup, refurbishment and furnishing — a net return of 4–6% represents €6,000–€9,600 per year, or €500–€800 per month.
What affects your yield most:
Occupancy — empty rooms cost you. Marketing, pricing, and good management matter.
Rental model — serviced rooms on 11-month contracts can generate more than a single long-term tenant but require more active management. Know which model suits you before you buy.
Location within the region — Alicante city commands higher rents than Elche or inland towns, but purchase prices are higher too. The yield arithmetic can actually work better in less obvious locations.
Management quality — a good local property manager who knows the market, prices correctly, and maintains relationships with tenants is worth their fee many times over.
The honest bottom line
Alicante property is not a get-rich-quick investment. It is a solid, real-world asset that generates predictable cash flow, sits in a growing market, and compounds quietly over time. If that sounds like what you’re looking for, the numbers stack up.