BUYING LAND IN SPAIN
Buying urban plots (or land) is the first step you must take to make this investment. The choice of land is one of the main factors that will determine whether your business will succeed or fail.
The area where the land is located is very important. In the center of the cities, the land is highly valued. Generally, companies that are engaged in building buildings can cover this cost. Since its cost will be atomized according to the number of units that are built. Therefore, if you want to build a house, you will have to move a little away from the most central areas.
The price of a piece of land depends on many factors apart from the location, such as the building index, the maximum height, the minimum plot and zoning.
Also, you must take into account before buying land the situation regarding land use so that it coincides with your investment project.
VALUES TO INVEST IN PLOTS TO BUILD
Below we will provide some values for you to take into account when carrying out your financial project.
In neighborhoods located between 7 and 15 km from the city center, calculate an average of 500 euros per square meter. Therefore, a land of 500 square meters will have an approximate value of 230 to 250 thousand euros.
In addition to the price of the land, you must calculate the taxes to be paid. In the event that the seller is a natural person, they must pay the ITP (Property Transfer Tax): 10% of the value of the land.
If the seller is a legal person, he must pay VAT: 21% of the value of the land.
Tax on Documentary Legal Acts (IAJD): average approximately 1% to 1.5%.
To this you must add the notary fees and property registration fees.
If you want to build for your own home, the house project will have your stamp, since you will do it according to your needs.
BUILD THE HOUSE ON YOUR OWN PLOT
If the house is to be sold for a profit, you may want to let the professionals decide what is best for profitability purposes.
The first step is to order a project and choose the company that is going to develop the direction of the work.
Here we give you an idea of the costs that this first stage will demand. In the first place, for the architecture project and the construction management, you must calculate a cost of 20% of the total value. For example, in the construction of a house of 200 square meters with a value of 240,000 euros, he calculates that this value will be 48,000 euros. In addition, you will have to add energy efficiency engineer expenses, where you will spend approximately €1,300. For geotechnical studies, €800 and for topographical studies, €200 approximately. In total, the cost of these three items would be €2,300.
Subsequently, in the second stage the work is developed. The price per square meter built has an average value of €1,200. Of course, these costs are highly variable. If the project is for your own home, the cost will surely rise, because you will look for better quality, more exclusive and durable materials. In our example, calculating a house of 200 square meters, the value of the construction will amount to 240,000 euros.
You must take into account the following costs:
#Value Added Tax (VAT): 10% on the total value of the constructed area.
#Tax on Constructions, Installations and Works (ICIO): 4% on the price of the construction.
#Town Hall Building License: 4% on the construction price.
#First occupancy license: It has a value of 0.05% of the total.
In our example you should add to the total cost the sum of 43320 euros.
Other expenses to take into account are electrical, water and gas installations, which add up to approximately €3,000.
CONCLUSION OF INVESTING IN PLOTS TO BUILD
The project of your own house made to measure is an incredible idea. It's like building your own dream. But in addition, it can be a great investment in the real estate market. It all depends on getting the numbers right. Do not get too excited about the process and spend more than you should, respect the investment project and entrust all this to an architecture company that generates confidence in you and specializes in these issues.
All the prices that appear in this article are merely indicative. The margin can vary widely depending on your goals, the location of the land, and the quality of the construction above all else.
The important thing is that you keep in mind that, although the real estate market behaves in a changing way, investing in land has proven to be something safe and profitable in the long term. Go ahead with this adventure of investing in land to build on! Not only will you earn money, but you will have a great experience seeing your work grow from seed to full creation.
Our Real Estate Agents will help you find the property that best suits your needs (location and budget).
We accompany you at all times, in the buying and selling process, whether you want to buy or sell.
Enter – Real Estate Agency in Alicante:
+34 678 00 88 00