Alicante Property Buyers Benefit as ITP Drops from 10% to 9%

A welcome saving for anyone buying a resale property in Alicante

There is good news for property buyers in Alicante: the general Property Transfer Tax, known in Spain as ITP (Impuesto sobre Transmisiones Patrimoniales) has dropped from 10% to 9% for most resale property purchases in the Valencian Community, which includes Alicante, Valencia and Castellón.

The change took effect from 1 June 2026. Under Ley 5/2025, the general rate for taxable property transfers is now 9%, while properties valued at more than €1,000,000 continue to be taxed at 11%. The same reform also reduces the general AJD rate from 1.5% to 1.4%.

For buyers looking at homes in Alicante, Jávea, Dénia, Moraira, Altea, Torrevieja, Orihuela Costa or anywhere else on the Costa Blanca, this is a meaningful reduction in the upfront cost of buying a property.

What is ITP?

ITP is the tax paid when buying a resale property in Spain. In simple terms, if you buy a second-hand home from a private seller, you normally pay ITP instead of VAT.

This is one of the biggest additional costs buyers face when purchasing in Alicante. It is paid on top of the purchase price and sits alongside other costs such as notary fees, Land Registry fees, legal fees and, where relevant, mortgage-related costs.

For years, the standard ITP rate in the Valencian Community was 10%. The move to 9% may sound like a small one-point reduction, but in real money it can save buyers thousands of euros.

How much could buyers save?

The saving is easy to understand: buyers now save 1% of the taxable property value compared with the previous 10% rate.

For example, on a property priced at €150,000, the old 10% ITP would have been €15,000. Under the new 9% rate, the ITP would be €13,500, giving the buyer an estimated saving of €1,500.

On a property priced at €250,000, the old 10% ITP would have been €25,000. Under the new 9% rate, the ITP would be €22,500, giving the buyer an estimated saving of €2,500.

On a property priced at €400,000, the old 10% ITP would have been €40,000. Under the new 9% rate, the ITP would be €36,000, giving the buyer an estimated saving of €4,000.

On a property priced at €650,000, the old 10% ITP would have been €65,000. Under the new 9% rate, the ITP would be €58,500, giving the buyer an estimated saving of €6,500.

For many buyers, that saving could cover a large part of their legal fees, furniture budget, moving costs or initial improvements after completion.

Why this matters in Alicante

Alicante remains one of Spain’s most attractive property markets, particularly for international buyers, retirees, lifestyle movers and investors looking for sun, sea, strong infrastructure and year-round appeal.

The Costa Blanca offers a wide range of property options, from apartments close to the beach to villas with sea views, golf properties, rural fincas and lock-up-and-leave holiday homes. In a competitive market, every percentage point matters.

The reduction from 10% to 9% makes Alicante property slightly more accessible by lowering the amount buyers need to have available at completion. This is especially important because purchase taxes and fees in Spain are usually paid upfront and cannot always be rolled into a mortgage.

Does the new 9% rate apply to all properties?

Not quite. The 9% rate applies to most standard resale property purchases in the Valencian Community, including Alicante. However, there are important exceptions.

Properties valued above €1,000,000 remain subject to the 11% rate under the same legislation. In addition, some buyers or property types may qualify for different reduced rates depending on their personal circumstances and the purpose of the purchase.

This is why buyers should always check their position with a qualified lawyer or tax adviser before signing.

What about new-build properties?

The ITP reduction is mainly relevant to resale homes. New-build properties are treated differently for tax purposes.

When buying a new-build home in Spain, the buyer generally pays IVA at 10% instead of ITP. For new-build purchases, AJD is also relevant. From 1 June 2026, the general AJD rate in the Valencian Community is reduced to 1.4%.

In short:

Resale property: usually ITP, now generally 9%

New-build property: usually IVA at 10%, plus AJD

High-value property above €1 million: special rules may apply

Why timing matters

For buyers who were already planning to purchase in Alicante, the timing of completion is important. The new 9% rate applies to taxable events from 1 June 2026 onwards.

That means the key date is not simply when you start viewing properties, make an offer or sign a reservation contract. What matters for tax purposes is the relevant taxable event, which in a normal property purchase is linked to completion and formal transfer.

Buyers should ask their solicitor to confirm exactly which rate applies before completion.

A practical example

Imagine you are buying a resale apartment in Alicante for €300,000.

Under the previous 10% rate, the ITP would have been:

€300,000 x 10% = €30,000

Under the new 9% rate, the ITP is:

€300,000 x 9% = €27,000

That is a saving of €3,000.

For many buyers, €3,000 is not a minor amount. It could pay for a fitted wardrobe package, air-conditioning upgrades, new appliances, legal costs or several months of community fees.

What should buyers do now?

If you are considering buying a property in Alicante, this tax reduction is a good reason to review your budget carefully. A lower ITP bill may give you slightly more flexibility, but it should not replace proper financial planning.

Before committing to a purchase, buyers should check whether the property is resale or new-build, confirm whether the 9% ITP rate applies, ask about any reduced rates or exemptions they may qualify for, budget for all additional purchase costs, make sure the taxable value has been reviewed correctly, and speak to an independent lawyer before signing contracts.

The new rate is positive news, but it is still essential to understand the full cost of buying before making a decision.

What this means for sellers

The ITP reduction is also good news for sellers. Lower buying costs can make a property more attractive, especially to buyers comparing Alicante with other regions of Spain.

For a buyer choosing between similar properties, a tax saving of several thousand euros can influence affordability and confidence. This may help support demand in the resale market, particularly for well-presented homes in desirable coastal and inland locations.

Sellers should not assume that the tax cut alone will sell a property, but it is a useful point to highlight in marketing conversations. A buyer who understands the saving may feel more comfortable moving forward.

Final thoughts

The drop in ITP from 10% to 9% is a positive development for Alicante’s property market. It reduces one of the largest upfront costs of buying a resale home and gives buyers a little more breathing room in their budget.

For anyone looking to buy on the Costa Blanca, the message is clear: Alicante has become slightly more affordable from a tax perspective, but professional advice remains essential.

Whether you are buying a holiday home, relocating permanently or investing in a resale property, understanding the new ITP rate could help you plan more confidently and avoid unexpected costs at completion.

If you are thinking about buying or selling property in Alicante, now is a smart time to review your options, update your budget and speak with a local property expert who understands the new tax landscape.