The asking price is never the figure you need in the bank. When you are budgeting to buy property in Lanzarote, the taxes, notary charges, registry fees, and legal costs add to the agreed price and fall due in euros at points spread over a two- to three-month timeline. Most of the UK buyers we meet in our Puerto del Carmen and Playa Blanca offices arrive with a clear idea of what they want to spend on the property, but no clear idea of what it actually costs to complete. That gap is where offers fall apart.
Below, we set out every cost in the order the money leaves your account, from the reservation deposit through to the tax filings that follow completion, and we separate what you pay from what the seller pays. If you are still weighing up areas and price levels, read our overview of the Lanzarote property market in 2026 alongside this.
The Short Answer: What Buying in Lanzarote Really Costs
Budget 10%-13% on top of the agreed purchase price. On a cash resale purchase, the unavoidable line items usually total 8%-10%, with transfer tax the largest single charge. A Spanish mortgage, or a sensible margin for currency movement, pushes the figure towards the top of that band. New-build purchases are taxed differently and incur two separate charges rather than one. All figures in this article are indicative and were reviewed in September 2026.
On a €200,000 resale apartment bought without a mortgage:
• Transfer tax (ITP) at an indicative 6.5%: €13,000
• Notary fees: around €700 to €1,200, depending on price and deed complexity
• Land registry inscription: around €400 to €800
• Independent legal representation: commonly 1% plus IGIC, or a flat €1,500 to €2,500
• Gestor and administrative costs for filings and utility transfers: around €200 to €400
That is roughly €15,800 to €17,400, so you need between €216,000 and €218,000 available. We would hold closer to €220,000 so that a shift in the exchange rate between agreeing on the price and signing does not leave you short. Test the same maths against live listings, for example, current property for sale in Puerto del Carmen, where two-bedroom apartments frequently sit around that price. Our page on buying property in Lanzarote sets out the same sequence from the process side.
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Key takeaways • Total buyer costs on a Lanzarote resale purchase are indicative, 10%-13% of the price once contingency is included. • Transfer tax (ITP) on resale property in the Canary Islands is indicative of 6.5%, lower than most mainland Spanish regions. • New builds attract IGIC at an indicative 7% plus AJD stamp duty at an indicative 1%, not mainland IVA. • Plusvalia municipal is normally paid by the seller, not the buyer. • The estate agency commission in Lanzarote is paid by the seller, so our fee does not come out of your budget. |
Costs You Pay Before You Complete
Before completion, you will normally pay a reservation deposit, an arras deposit of around 10% of the price, part of your lawyer's fee, and a small charge for the NIE application. The sequence matters more than the individual amounts, because each stage carries a deadline.
Reservation Deposit
Typically, €3,000 to €6,000 is required to take the property off the market while checks begin, is held pending the private contract, and is deducted from the price at completion.
Private Purchase Contract (Contrato de Arras)
Signed once your lawyer has reviewed the title, this commonly requires around 10% of the price, again credited against the final figure. Under a standard arras penitenciales clause, a buyer who withdraws forfeits the deposit, and a seller who withdraws repays double the deposit, so nothing should be signed until the legal checks are complete.
Legal Representation
Most abogados working with overseas buyers invoice part of their fee on engagement and the balance at completion. Instruct a lawyer before the arras contract, not after.
NIE and Bank Account
You need a foreign identification number in Spanish to complete. The administrative charge is small, and timing is the real issue. Our guide to getting a Spanish NIE number covers the routes and paperwork. A Spanish bank account is usually free to open, though non-resident accounts often carry small monthly maintenance charges.
Survey
Not customary in Spain and not required by lenders, but a structural report for an older villa costs a few hundred euros and is worth it when there is any doubt about the roof, terrace, or extension.
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Quick tip: Move your deposit funds into euros before you reserve, not after. It puts the timing of the transfer under your control rather than the completion calendar's. |
Taxes on the Purchase
Resale purchases in Lanzarote are subject to transfer tax (ITP) at an indicative 6.5%, while new builds are subject to IGIC at an indicative 7% plus AJD stamp duty at an indicative 1%. The Canary Islands operate their own indirect tax system, which is why UK guides written for the Costa del Sol or Costa Blanca overstate the tax a Lanzarote buyer pays. Confirm current rates with your lawyer or gestor, or with the Canary Islands tax authority, before you commit.
Resale Property: Transfer Tax
Impuesto de Transmisiones Patrimoniales is calculated on the declared purchase price stated in the deed and is payable by the buyer, normally within 30 working days of signing, with your lawyer or gestor filing and settling it. One point catches buyers out: the tax office can review a declared value it considers below market and issue a supplementary assessment months later, which is why we never advise under-declaring a price.
New Build Property: IGIC and Stamp Duty
A newly built property purchased from a developer is subject to IGIC, the Canary Islands' general indirect tax, rather than mainland Spanish IVA. The indicative rate on new residential property is 7% against 10% IVA on the mainland, with Actos Juridicos Documentados (AJD) at an indicative 1% on the notarised deed. A new build, therefore, carries roughly 8% in tax, compared with roughly 6.5% on an equivalent resale. For a € 250,000 purchase, that is a difference of around € 3,750, worth factoring in when comparing a new development against an established resale.
Plusvalia municipal, the local tax on the increase in land value since the seller acquired the property, is normally the seller's responsibility. Occasionally, a contract attempts to pass it to the buyer, and your lawyer should flag that clause immediately. Rates and allowances change, so treat every figure here as general guidance and confirm the current position with a qualified Spanish lawyer or tax adviser.
Professional and Registration Fees Explained
Notary, land registry, legal, and gestor charges together come to an indicative 1%-2% of the purchase price, as reviewed in September 2026. Each one buys something specific.
Notary (Notario)
The escritura de compraventa, the public deed of sale, is signed in front of a notary, who verifies identities, confirms the property description, checks that price and taxes are correctly declared, and formally records the transfer. Notarial fees follow a national scale linked to the declared price, so they are not negotiable. The Spanish notarial council publishes the framework.
Land Registry (Registro de la Propiedad)
An inscription registers you as the legal owner and is what makes your title enforceable against third parties.
Independent Legal Representation
Your abogado checks for a clean title, outstanding charges or mortgages, unpaid community fees, illegal extensions, and the correct licences for holiday letting, where that is your plan. Fees are typically 1% plus IGIC or a fixed quote. Using the seller's or developer's lawyer instead of your own is one of the things that most buyers get wrong.
Power of Attorney, Translation, and Gestor
If you cannot be on the island for signing, a notarised power of attorney lets your lawyer sign for you. Arranged in Spain, it usually costs €100- €200, while arranging it in the UK requires notarisation and an apostille, which costs more and takes longer. A sworn translator or a bilingual notary's services are sometimes required, and a gestor handles tax filings, registry submissions, and utility transfers.
Additional Costs When Using a Spanish Mortgage
A Spanish lender will instruct a valuation (tasación), usually for €300 to €600, which is paid by the borrower. Most banks charge an arrangement or opening fee, typically 0.5% to 1.5% of the loan amount. Building insurance is almost always a condition of the loan, and many lenders press for life cover, which affects your monthly cost rather than your completion cost. Under current Spanish rules, the AJD on the mortgage deed falls to the lender rather than the borrower, though your lawyer should confirm this on your specific offer. Our guide to mortgages in Spain for non-residents covers deposit levels, rates, and documentation in full.
Currency: The Cost Most Buyers Miss
You agree a price in euros and pay from a sterling account, so the true cost of your purchase fluctuates daily between reservation and completion. A 3% shift in the rate on a €200,000 purchase is roughly €6,000, more than the notary, registry, and legal fees combined.
Two costs matter here
The transfer fee is usually visible and often small. The margin built into the rate itself is not shown, and high street banks typically take considerably more on it than specialist currency providers, so compare the number of euros that will actually arrive in the Spanish account rather than the headline fee. A forward contract fixes a rate now for a transfer at a set point later, removing the uncertainty between signing the arras contract and completion. We do not recommend or endorse any particular provider, and currency services sit outside our remit as an estate agency, but we do tell every buyer to have this arranged before the arras deposit falls due.
The Ongoing Cost of Owning in Lanzarote
Annual running costs for a Lanzarote property are modest compared with UK equivalents, largely because IBI is low and heating bills are minimal. They still need budgeting for, particularly the tax filing that applies whether or not you let the property.
• IBI (Impuesto sobre Bienes Inmuebles): the annual local property tax, set by each municipality against the cadastral value. In a typical apartment, expect a few hundred euros a year rather than a four-figure UK council tax bill.
• Community fees: payable on any property in a complex, covering pool maintenance, gardens, lighting, and communal insurance. Lifts, large pools, and gated security push the figure up, so check it before offering, especially across property for sale in Playa Blanca, where resort developments vary widely.
• Rubbish collection (basura): a small separate municipal charge, usually billed annually or twice yearly.
• Water and electricity: standing charges apply even on an empty property, so budget for the year rather than the weeks you are there.
• Non-resident income tax (Modelo 210): Non-resident owners file annually. If the property is let, tax is due on the rental income; if it is not let, an imputed income charge applies on the cadastral value. Details are published by the Agencia Tributaria, and your gestor will normally file them.
• Insurance: building coverage is often partly handled by the community policy, but contents and third-party liability are yours.
• Management or key holding: cleaning, changeovers, meter readings, and inspections where the property is let or left empty for months.
Who Pays What: Buyer and Seller Costs
The buyer pays the purchase taxes and the professional fees; the seller pays the agency commission and plusvalia municipal. Indicative amounts, reviewed September 2026:
Paid by the buyer
• Transfer tax (ITP) on resale: 6.5% of the declared price
• IGIC on new build: 7% of the price, plus AJD stamp duty at 1%
• Notary fees: € 700 to € 1,200, customary rather than fixed by law
• Land registry inscription: € 400 to € 800
• Legal fees: 1% plus IGIC, or a fixed quote
• Gestor and filings: € 200 to € 400
• Mortgage valuation and arrangement fee: € 300 to € 600 plus the lender's fee, where a loan is used
Paid by the seller
• Estate agency commission, agreed in the listing agreement
• Plusvalia municipal, varying by municipality and years of ownership
• Retention on non-resident sellers: 3% of the sale price, withheld at completion
IBI for the current year is normally apportioned to the completion date and split by agreement. Some splits are customary rather than fixed in law and can be negotiated within the contract, which is another reason to have your own lawyer drafting rather than reviewing. If you expect to be on the other side of this list one day, our guidance on selling a Lanzarote property sets out the seller's position in the same detail.
• Notary fees: around €700 to €1,200, depending on price and deed complexity
• Land registry inscription: around €400 to €800
• Independent legal representation: commonly 1% plus IGIC, or a flat €1,500 to €2,500
• Gestor and administrative costs for filings and utility transfers: around €200 to €400
That is roughly €15,800 to €17,400, so you need between €216,000 and €218,000 available. We would hold closer to €220,000 so that a shift in the exchange rate between agreeing on the price and signing does not leave you short. Test the same maths against live listings, for example, current property for sale in Puerto del Carmen, where two-bedroom apartments frequently sit around that price. Our page on buying property in Lanzarote sets out the same sequence from the process side.
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Key takeaways • Total buyer costs on a Lanzarote resale purchase are indicative, 10%-13% of the price once contingency is included. • Transfer tax (ITP) on resale property in the Canary Islands is indicative of 6.5%, lower than most mainland Spanish regions. • New builds attract IGIC at an indicative 7% plus AJD stamp duty at an indicative 1%, not mainland IVA. • Plusvalia municipal is normally paid by the seller, not the buyer. • The estate agency commission in Lanzarote is paid by the seller, so our fee does not come out of your budget. |
Costs You Pay Before You Complete
Before completion, you will normally pay a reservation deposit, an arras deposit of around 10% of the price, part of your lawyer's fee, and a small charge for the NIE application. The sequence matters more than the individual amounts, because each stage carries a deadline.
Reservation Deposit
Typically, €3,000 to €6,000 is required to take the property off the market while checks begin, is held pending the private contract, and is deducted from the price at completion.
Private Purchase Contract (Contrato de Arras)
Signed once your lawyer has reviewed the title, this commonly requires around 10% of the price, again credited against the final figure. Under a standard arras penitenciales clause, a buyer who withdraws forfeits the deposit, and a seller who withdraws repays double the deposit, so nothing should be signed until the legal checks are complete.
Legal Representation
Most abogados working with overseas buyers invoice part of their fee on engagement and the balance at completion. Instruct a lawyer before the arras contract, not after.
NIE and Bank Account
You need a foreign identification number in Spanish to complete. The administrative charge is small, and timing is the real issue. Our guide to getting a Spanish NIE number covers the routes and paperwork. A Spanish bank account is usually free to open, though non-resident accounts often carry small monthly maintenance charges.
Survey
Not customary in Spain and not required by lenders, but a structural report for an older villa costs a few hundred euros and is worth it when there is any doubt about the roof, terrace, or extension.
|
Quick tip: Move your deposit funds into euros before you reserve, not after. It puts the timing of the transfer under your control rather than the completion calendar's. |
Taxes on the Purchase
Resale purchases in Lanzarote are subject to transfer tax (ITP) at an indicative 6.5%, while new builds are subject to IGIC at an indicative 7% plus AJD stamp duty at an indicative 1%. The Canary Islands operate their own indirect tax system, which is why UK guides written for the Costa del Sol or Costa Blanca overstate the tax a Lanzarote buyer pays. Confirm current rates with your lawyer or gestor, or with the Canary Islands tax authority, before you commit.
Resale Property: Transfer Tax
Impuesto de Transmisiones Patrimoniales is calculated on the declared purchase price stated in the deed and is payable by the buyer, normally within 30 working days of signing, with your lawyer or gestor filing and settling it. One point catches buyers out: the tax office can review a declared value it considers below market and issue a supplementary assessment months later, which is why we never advise under-declaring a price.
New Build Property: IGIC and Stamp Duty
A newly built property purchased from a developer is subject to IGIC, the Canary Islands' general indirect tax, rather than mainland Spanish IVA. The indicative rate on new residential property is 7% against 10% IVA on the mainland, with Actos Juridicos Documentados (AJD) at an indicative 1% on the notarised deed. A new build, therefore, carries roughly 8% in tax, compared with roughly 6.5% on an equivalent resale. For a € 250,000 purchase, that is a difference of around € 3,750, worth factoring in when comparing a new development against an established resale.
Plusvalia municipal, the local tax on the increase in land value since the seller acquired the property, is normally the seller's responsibility. Occasionally, a contract attempts to pass it to the buyer, and your lawyer should flag that clause immediately. Rates and allowances change, so treat every figure here as general guidance and confirm the current position with a qualified Spanish lawyer or tax adviser.
Professional and Registration Fees Explained
Notary, land registry, legal, and gestor charges together come to an indicative 1%-2% of the purchase price, as reviewed in September 2026. Each one buys something specific.
Notary (Notario)
The escritura de compraventa, the public deed of sale, is signed in front of a notary, who verifies identities, confirms the property description, checks that price and taxes are correctly declared, and formally records the transfer. Notarial fees follow a national scale linked to the declared price, so they are not negotiable. The Spanish notarial council publishes the framework.
Land Registry (Registro de la Propiedad)
An inscription registers you as the legal owner and is what makes your title enforceable against third parties.
Independent Legal Representation
Your abogado checks for a clean title, outstanding charges or mortgages, unpaid community fees, illegal extensions, and the correct licences for holiday letting, where that is your plan. Fees are typically 1% plus IGIC or a fixed quote. Using the seller's or developer's lawyer instead of your own is one of the things that most buyers get wrong.
Power of Attorney, Translation, and Gestor
If you cannot be on the island for signing, a notarised power of attorney lets your lawyer sign for you. Arranged in Spain, it usually costs €100- €200, while arranging it in the UK requires notarisation and an apostille, which costs more and takes longer. A sworn translator or a bilingual notary's services are sometimes required, and a gestor handles tax filings, registry submissions, and utility transfers.
Additional Costs When Using a Spanish Mortgage
A Spanish lender will instruct a valuation (tasación), usually for €300 to €600, which is paid by the borrower. Most banks charge an arrangement or opening fee, typically 0.5% to 1.5% of the loan amount. Building insurance is almost always a condition of the loan, and many lenders press for life cover, which affects your monthly cost rather than your completion cost. Under current Spanish rules, the AJD on the mortgage deed falls to the lender rather than the borrower, though your lawyer should confirm this on your specific offer. Our guide to mortgages in Spain for non-residents covers deposit levels, rates, and documentation in full.
Currency: The Cost Most Buyers Miss
You agree a price in euros and pay from a sterling account, so the true cost of your purchase fluctuates daily between reservation and completion. A 3% shift in the rate on a €200,000 purchase is roughly €6,000, more than the notary, registry, and legal fees combined.
Two costs matter here
The transfer fee is usually visible and often small. The margin built into the rate itself is not shown, and high street banks typically take considerably more on it than specialist currency providers, so compare the number of euros that will actually arrive in the Spanish account rather than the headline fee. A forward contract fixes a rate now for a transfer at a set point later, removing the uncertainty between signing the arras contract and completion. We do not recommend or endorse any particular provider, and currency services sit outside our remit as an estate agency, but we do tell every buyer to have this arranged before the arras deposit falls due.
The Ongoing Cost of Owning in Lanzarote
Annual running costs for a Lanzarote property are modest compared with UK equivalents, largely because IBI is low and heating bills are minimal. They still need budgeting for, particularly the tax filing that applies whether or not you let the property.
• IBI (Impuesto sobre Bienes Inmuebles): the annual local property tax, set by each municipality against the cadastral value. In a typical apartment, expect a few hundred euros a year rather than a four-figure UK council tax bill.
• Community fees: payable on any property in a complex, covering pool maintenance, gardens, lighting, and communal insurance. Lifts, large pools, and gated security push the figure up, so check it before offering, especially across property for sale in Playa Blanca, where resort developments vary widely.
• Rubbish collection (basura): a small separate municipal charge, usually billed annually or twice yearly.
• Water and electricity: standing charges apply even on an empty property, so budget for the year rather than the weeks you are there.
• Non-resident income tax (Modelo 210): Non-resident owners file annually. If the property is let, tax is due on the rental income; if it is not let, an imputed income charge applies on the cadastral value. Details are published by the Agencia Tributaria, and your gestor will normally file them.
• Insurance: building coverage is often partly handled by the community policy, but contents and third-party liability are yours.
• Management or key holding: cleaning, changeovers, meter readings, and inspections where the property is let or left empty for months.
Who Pays What: Buyer and Seller Costs
The buyer pays the purchase taxes and the professional fees; the seller pays the agency commission and plusvalia municipal. Indicative amounts, reviewed September 2026:
Paid by the buyer
• Transfer tax (ITP) on resale: 6.5% of the declared price
• IGIC on new build: 7% of the price, plus AJD stamp duty at 1%
• Notary fees: € 700 to € 1,200, customary rather than fixed by law
• Land registry inscription: € 400 to € 800
• Legal fees: 1% plus IGIC, or a fixed quote
• Gestor and filings: € 200 to € 400
• Mortgage valuation and arrangement fee: € 300 to € 600 plus the lender's fee, where a loan is used
Paid by the seller
• Estate agency commission, agreed in the listing agreement
• Plusvalia municipal, varying by municipality and years of ownership
• Retention on non-resident sellers: 3% of the sale price, withheld at completion
IBI for the current year is normally apportioned to the completion date and split by agreement. Some splits are customary rather than fixed in law and can be negotiated within the contract, which is another reason to have your own lawyer drafting rather than reviewing. If you expect to be on the other side of this list one day, our guidance on selling a Lanzarote property sets out the seller's position in the same detail.
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