4 calculations you should make before buying a home

One of your goals for 2023 is to become a landlord? It may be the right time if you play your cards right!

Before doing so, we recommend that you know what are the calculations that will help you make sure that you are carrying out a 100% viable operation.

4 calculations you should make before buying a home

Having everything under control before buying a property is essential to make an informed decision and minimize the risk of possible financial problems.

1)     Saving needed to pay the down payment on the house

Generally, banks grant mortgage loans for a maximum of 80% of the total value of the property, if it is a first home.

In the case of a second or third property, the bank will only finance between 60% and 75%.

Therefore, you must have saved the remaining 20%, plus an additional 10% corresponding to the Transfer Tax, ITP.

2)     Monthly mortage payment

This amount will depend on several factors, among them:

• The money you have paid in the down payment.

• The repayment term.

• The price of the property.

• If it is a fixed, variable or mixed mortgage.

It is recommended that, in none of the cases, the payment of the monthly payments corresponding to the mortgage exceeds 30% or 35% of the monthly income of the holders.

3)     Taxes

At the moment of acquiring the home of your dreams, the taxes will vary depending on each autonomous community. They will also depend on the typology of the house; that is to say, if it is a second-hand house or a new construction.

In Catalonia, for the purchase of a second-hand property, you will have to pay:

• The 10% corresponding to the Tax of Patrimonial Transmissions, ITP.

If it is a newly built property:

• 1.5% corresponding to the Tax on Documented Legal Acts, AJD.
• 10% corresponding to the Value Added Tax, VAT.

4)     Other expenses

Finally, there are other expenses associated with the purchase-sale that are always good to take into account, since they refer to the maintenance and the life of the home.

• Home insurance.
• Utilities.
• Debris collection fee.
• Real Estate Tax (IBI).
• Community expenses.
• Possible reforms.

Discover the best properties for sale and rent

In KM2 Real Estate Services – real estate agency in Barcelona and Madrid – we have more than 41 years of experience in the sector, which allows us to be great connoisseurs of the market. A long trajectory in which we have had the opportunity to help countless families to find the home of their dreams.

Our real estate portfolio consists of very good assets located in some of the best areas of the city.

Do you want us to help you find a home that meets all your needs? Contact us, it’s time to make your dream come true.