7 costs that you should take into account once you become an owner

Owning a property entails fixed expenses that tenants of a rental apartment generally do not have to pay.

We analyze the seven common expenses that the owner of any property must pay and calculate how much these expenses can amount to annually.

7 expenses that you will have to pay when owning a home

1- Mortgage monthly payments

If you have financed the home with a mortgage loan, you must pay the monthly mortgage payments month by month. In Spain, the average amount of the mortgage payment is around 648 euros, according to data from the IMIE Local Markets statistics prepared by Tinsa.

According to data from Tinsa, the average monthly mortgage payment in Spain was €648 per month in the first quarter of 2023

2- The Real Estate Tax

The Real Estate Tax, popularly known as the IBI, is an annual municipal tax whose cost varies depending on the home and the autonomous community in which it is located. The cost of the IBI is limited to a minimum of 0.4% and a maximum of 1.3% of the cadastral value of the property.

According to data from the Ministry of Finance, in 2022 owners paid between 320 euros and 804 euros of IBI depending on their place of residence.

3- Home insurance and life insurance

When purchasing a home with financing, the bank may force you to take out home or life insurance. Normally, each policy costs between 150 euros and 400 euros per year and the most common payment method is the annual premium. That is, you will pay the full fee every 12 months.

Home and life insurance may be mandatory if you take out a mortgage to buy your home

4- The community of neighbors

Another expense to pay when you become an owner is the neighborhood association fee. This is a monthly expense that each neighbor must pay to maintain the property: cleaning service, community area, repairs... In general, this expense is, on average, between 50 and 110 euros per month, and may be less or double depending on the features of the property, maintenance needs and the autonomous community.

5- Municipal taxes

In addition to the IBI, your municipality is likely to make you pay other local taxes, such as the garbage tax, a rate that varies from one municipality to another. According to a study by the National Organization of Consumers and Users (OCU), the average price of the garbage tax in Spain is 89.99 euros per year.

The waste tax is a tax set by each locality that ranges from 30 euros to 190 euros per year.

The city with the highest garbage tax is San Sebastián, where you pay, on average, 190 euros, while the cities with the cheapest waste tax are Soria or Alicante, where you pay 30 euros on average.

6- Housing supplies

By owning a home, you will be responsible for paying for supplies, such as water, electricity, gas, Internet and other related expenses. Furthermore, if it is a newly built home, you will also have to pay an extra price to register the supplies.

• According to the Spanish Electricity Network, the average monthly electricity bill expense is 40.50 euros.
• The price of the gas bill, according to the Institute for Energy Diversification and Saving (IDAE), ranges between 25 euros and 60 euros per month.
• According to data from the Spanish Association of Water Supply and Sanitation, the price of monthly water consumption ranges between 7.6 euros and 38 euros.
• For Internet and mobile line rates, Spaniards pay 53 euros on average.

7- Expenses associated with the mortgage

Finally, you must also take into account the expenses related to the mortgage. Although it is not the most common, it is possible that the bank makes you pay for related services, such as the bank account or linked cards. Also, it may force you to contract mandatory services such as a home alarm for a bonus on the loan.

According to Asufin calculations, products linked to the mortgage can cost around 600 euros more per year.  

In summary, these will be, on average, the annual expenses that you will have as an owner when you become the owner of a home:

Source : Fotocasa.es