Buying a home in Andalucía? A 2027 tax change could save you thousands

Buyers in Andalucía currently pay the same seven per cent tax on a €160,000 flat as they do on a €500,000 villa, unless they fall under a strict discount ceiling. From 2027, though, that ceiling could widen sharply, and anyone buying a resale home as their main residence could end up saving thousands.

A €50,000 wider band for the cheaper rate

The Junta de Andalucía wants to raise the price ceiling for its reduced six per cent property tax rate from €150,000 to €200,000 from 2027, taking in tens of thousands more resale-home buyers who currently pay the full seven per cent.

Take a buyer paying €180,000 for their main home today. At the current seven per cent general rate, that’s €12,600 in transfer tax. Under the wider threshold, the same purchase would qualify for the reduced six per cent rate instead, a bill of €10,800, a saving of €1,800.

Not every buyer gets that. Someone buying a €200,000 second home, rather than their main residence, or paying above the new ceiling, would only benefit from the smaller general-rate cut, from seven per cent to 6.75 per cent, worth €500 on a €200,000 purchase.

Who actually qualifies for the discount

The reduced rates only apply to Impuesto de Transmisiones Patrimoniales (ITP, the tax paid when buying a resale home in Spain), not to new-build purchases, which are taxed differently through VAT. So the change affects the secondhand market that much of the Costa del Sol and Costa de Almería is built on, rather than off-plan developments. 

A third rate, 3.5 per cent, is reserved for buyers under 35, victims of gender violence or terrorism, residents of villages at risk of depopulation, people with disabilities and large families. That super-reduced ceiling would also rise, to €200,000 generally and to €300,000 for buyers with disabilities or from large families. 

How Andalucía compares with other regions 

Andalucía isn’t the only region cutting this tax. Valencia trimmed its own transfer tax on home purchases earlier this year, and Madrid already charges a flat six per cent regardless of price. Andalucía’s proposed 6.75 per cent general rate would still sit above both, even after the cut.

Andalucía’s eighth tax cut since 2019

Carolina España, Andalucía’s finance minister, announced the change on Thursday September 24, calling it good news for Andalucian families. The regional government estimates around 147,000 buyers stand to benefit, roughly 138,000 from the general-rate cut and 3,700 from the wider reduced-rate band.

It’s the eighth tax reduction Juanma Moreno’s government has introduced since taking office in 2019, when it scrapped the previous tiered rates of eight, nine and 10 per cent in favour of a flat seven. The regional government says its previous seven cuts have saved Andalucians close to €1.8 billion a year between them.

The finance minister has also pledged to keep cutting the general rate by a further 0.25 percentage points every year, aiming for six per cent by the end of the current term.

The timing isn’t accidental either. Spain’s home-buying affordability gap has grown far faster than the rest of the eurozone since 1980, and the country’s housing shortage isn’t expected to ease until at least 2034. Tax relief is one of the few levers a regional government can pull without waiting on Madrid.

The change still has to clear next year’s budget

None of this is law yet. The cut is due to form part of Andalucía’s 2027 budget, which still needs to pass through the regional parliament, where Moreno’s Partido Popular holds an absolute majority after May’s election.

So buyers weighing up a purchase now can’t rely on the lower rate applying before 2027, and should check the ceiling and their own eligibility once the budget is confirmed rather than assuming a discount that hasn’t been approved yet.