Authored by the expert who managed and guided the team behind the Spain Property Pack
Yes, the analysis of Palma de Mallorca's property market is included in our pack
Buying property in Palma de Mallorca as a foreigner means planning for extra costs beyond just the purchase price.
These costs include taxes, notary fees, legal checks, and several other expenses that can add up quickly if you are not prepared.
We constantly update this blog post to reflect the latest tax rates and fee structures so you always have accurate information for your Palma de Mallorca property purchase.
And if you're planning to buy a property in this place, you may want to download our pack covering the real estate market in Palma de Mallorca.
Overall, how much extra should I budget on top of the purchase price in Palma de Mallorca in 2026?
How much are total buyer closing costs in Palma de Mallorca in 2026?
As of early 2026, total buyer closing costs in Palma de Mallorca typically range from 10% to 15% of the purchase price for resale homes (so on a 500,000 EUR property, that means 50,000 to 75,000 EUR or roughly 52,000 to 78,000 USD), while new builds run slightly higher at 12% to 16%.
The minimum extra budget possible in Palma de Mallorca is around 9% of the purchase price (about 45,000 EUR or 47,000 USD on a 500,000 EUR home) if you stay in the lowest tax brackets, skip optional services like a lawyer, and pay cash without a mortgage.
On the high end, buyers in Palma de Mallorca should realistically plan for up to 18% to 22% in closing costs (90,000 to 110,000 EUR or 94,000 to 115,000 USD on a 500,000 EUR property) when hitting top tax brackets and adding lawyer fees, translations, and buyer-side agent charges.
The main factors that determine where you fall in this range are the property price (since Balearic transfer tax is progressive and climbs to 13% on amounts over 2 million EUR), whether you need a mortgage, and how many professional services you hire.
What's the usual total % of fees and taxes over the purchase price in Palma de Mallorca?
The usual total percentage of fees and taxes for property buyers in Palma de Mallorca in 2026 is around 12% for resale homes and 14% for new builds.
The realistic range that covers most standard transactions in Palma de Mallorca runs from 10% on the low end to 16% on the high end, depending on the property price and services used.
Government taxes (transfer tax or VAT plus stamp duty) typically account for 8% to 13% of this total, while professional service fees like notary, registry, and lawyer add another 2% to 3%.
By the way, you will find much more detailed data in our property pack covering the real estate market in Palma de Mallorca.
What costs are always mandatory when buying in Palma de Mallorca in 2026?
As of early 2026, the mandatory costs when buying property in Palma de Mallorca include the purchase tax (either ITP for resale or VAT plus stamp duty for new builds), notary fees for signing the public deed, and Land Registry inscription fees.
Optional but highly recommended costs for foreign buyers in Palma de Mallorca include hiring an independent conveyancing lawyer (especially important given Mallorca's history of unpermitted constructions), professional translation services if you do not speak Spanish, and a technical building survey for older properties.
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What taxes do I pay when buying a property in Palma de Mallorca in 2026?
What is the property transfer tax rate in Palma de Mallorca in 2026?
As of early 2026, the property transfer tax (ITP) in Palma de Mallorca for resale homes is progressive: 8% on the first 400,000 EUR, 9% from 400,000 to 600,000 EUR, 10% from 600,000 to 1,000,000 EUR, 12% from 1,000,000 to 2,000,000 EUR, and 13% above 2,000,000 EUR.
There is no special transfer tax surcharge for foreigners buying property in Palma de Mallorca as of January 2026, although a proposal targeting non-EU buyers has been debated but not enacted.
Buyers pay 10% VAT instead of transfer tax when purchasing a new-build home directly from a developer in Palma de Mallorca, which applies to first deliveries of newly constructed residential properties.
Stamp duty (AJD) in the Balearic Islands is set at 1.5% and applies mainly to new-build purchases alongside VAT, while resale buyers pay ITP instead and do not pay AJD on the purchase deed.
Are there tax exemptions or reduced rates for first-time buyers in Palma de Mallorca?
Tax exemptions and reduced rates for first-time buyers in Palma de Mallorca do exist but depend on specific criteria including age, family status, disability, property value, and whether the home will be your primary residence.
Buying property through a company in Palma de Mallorca changes which tax regime applies and typically adds compliance costs, so it is rarely a straightforward tax advantage for a simple personal residence purchase.
The tax difference between new-build and resale in Palma de Mallorca is significant: resale homes attract ITP at 8% to 13% progressively, while new builds attract 10% VAT plus 1.5% stamp duty.
To qualify for first-time buyer reductions in the Balearic Islands, you typically need to provide proof of income, residency intent, property value documentation, and a declaration that this will be your habitual residence.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Spain versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you’re planning to invest there.
Which professional fees will I pay as a buyer in Palma de Mallorca in 2026?
How much does a notary or conveyancing lawyer cost in Palma de Mallorca in 2026?
As of early 2026, notary fees in Palma de Mallorca typically range from 600 to 1,200 EUR (roughly 625 to 1,250 USD) for a straightforward purchase, while conveyancing lawyers commonly charge 0.8% to 1.5% of the price with minimums around 1,500 to 3,000 EUR (1,560 to 3,120 USD).
Notary fees in Palma de Mallorca are tariff-based (set by official regulation) and scale with the property price, while lawyer fees are typically charged as a percentage of the purchase price or a negotiated flat rate depending on transaction complexity.
Translation and interpreter services for foreign buyers in Palma de Mallorca cost around 150 to 400 EUR (155 to 415 USD) for key appointment interpreting and 30 to 60 EUR per page for sworn translations of essential documents.
A tax advisor is highly recommended for non-resident buyers in Palma de Mallorca who plan to rent out their property, with typical costs of 300 to 800 EUR (310 to 830 USD) for initial setup and 200 to 600 EUR (210 to 625 USD) per annual tax return.
We have a whole part dedicated to these topics in our our real estate pack about Palma de Mallorca.
What's the typical real estate agent fee in Palma de Mallorca in 2026?
As of early 2026, the typical real estate agent fee in Palma de Mallorca ranges from 3% to 6% of the sale price plus 21% VAT, which on a 500,000 EUR property means 15,000 to 30,000 EUR (roughly 15,600 to 31,200 USD) plus VAT.
In most Palma de Mallorca transactions the seller pays the agent commission because the seller hires the listing agent, but buyers should confirm this in writing since some agencies charge buyer-side service or reservation fees.
The realistic range for agent fees in Palma de Mallorca runs from 3% plus VAT at the low end (for standard listings) up to 6% plus VAT or more for premium properties or when using a dedicated buyer's agent.
How much do legal checks cost (title, liens, permits) in Palma de Mallorca?
Legal checks in Palma de Mallorca, including title search, liens verification, registry extracts, and planning permit review, typically cost between 300 and 1,200 EUR (310 to 1,250 USD) depending on the property's complexity.
Property valuation fees in Palma de Mallorca, which are required if you take out a mortgage, typically range from 300 to 600 EUR (310 to 625 USD) depending on the property size and location.
The most critical legal check that should never be skipped in Palma de Mallorca is the planning and legality verification, since the island has pockets of unpermitted constructions and extensions that can become the buyer's legal and financial burden.
Buying a property with hidden issues is something we mention in our list of risks and pitfalls people face when buying real estate in Palma de Mallorca.
Get the full checklist for your due diligence in Palma de Mallorca
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What hidden or surprise costs should I watch for in Palma de Mallorca right now?
What are the most common unexpected fees buyers discover in Palma de Mallorca?
The most common unexpected fees buyers discover in Palma de Mallorca include the 3% withholding tax when buying from a non-resident seller, unpaid community-of-owners fees, outstanding IBI property tax, and costs for legalizing unpermitted building works.
Yes, buyers in Palma de Mallorca can inherit unpaid property taxes and community debts attached to the property, which is why you need documentary proof at completion that IBI and community fees are fully cleared.
Scams with fake listings or fake fees do occur in Palma de Mallorca, and the best protection is to insist that all funds go through your lawyer or notary-controlled workflow and to verify the property's title position before paying any meaningful deposit.
Fees usually not disclosed upfront in Palma de Mallorca include extra due diligence costs for planning verification, additional notary copies, translation and power-of-attorney administration, and sometimes buyer-side agency charges.
In our property pack covering the property buying process in Palma de Mallorca, we go into details so you can avoid these pitfalls.
Are there extra fees if the property has a tenant in Palma de Mallorca?
Extra fees when buying a tenanted property in Palma de Mallorca typically range from 300 to 1,000 EUR (310 to 1,040 USD) in additional legal costs for contract review, tenant deposit handling, and rent proration at completion.
When you purchase a tenanted property in Palma de Mallorca, you inherit the existing rental contract and must honor its terms, including the tenant's right to remain until the lease ends.
Terminating an existing lease immediately after purchase is generally not possible in Palma de Mallorca, as Spanish tenancy law protects sitting tenants and the buyer steps into the landlord's obligations under the existing contract.
A sitting tenant in Palma de Mallorca typically reduces the property's market value by 10% to 20% or more, which can work in your favor during negotiations if you are happy to keep the tenant or wait for the lease to expire.
If you want to optimize your rental strategy, you can read our complete guide on how to buy and rent out in Palma de Mallorca.
We have made this infographic to give you a quick and clear snapshot of the property market in Spain. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
Which fees are negotiable, and who really pays what in Palma de Mallorca?
Which closing costs are negotiable in Palma de Mallorca right now?
Negotiable closing costs in Palma de Mallorca include lawyer fee structures (fixed versus percentage), translator costs (hourly versus package deals), gestoria administrative fees, and sometimes buyer-side agency service charges.
Closing costs that are fixed by law and cannot be negotiated in Palma de Mallorca include all taxes (ITP, VAT, and AJD) and the core tariff-based portions of notary and Land Registry fees.
Buyers in Palma de Mallorca can typically achieve a 10% to 20% reduction on negotiable professional fees like lawyer charges, especially when comparing quotes from multiple providers or bundling services.
Can I ask the seller to cover some closing costs in Palma de Mallorca?
Asking the seller to cover some closing costs in Palma de Mallorca is possible but not common, with success depending heavily on market conditions and how motivated the seller is to close the deal.
Sellers in Palma de Mallorca are most commonly willing to cover costs like fixing registry or title issues before completion, clearing any outstanding community debts, and occasionally sharing notary fees.
Sellers are more likely to accept covering closing costs in Palma de Mallorca when the property has been listed for a long time, the market is slow, or the property has issues that reduce its appeal to other buyers.
Is price bargaining common in Palma de Mallorca in 2026?
As of early 2026, price bargaining is common in Palma de Mallorca but results vary significantly depending on the property's location (Old Town versus outer districts), condition, how long it has been listed, and whether the asking price is realistic.
Buyers in Palma de Mallorca typically negotiate 3% to 8% below the asking price on fairly priced homes (so 15,000 to 40,000 EUR or 15,600 to 41,600 USD on a 500,000 EUR property), with discounts of 10% or more possible only on overpriced or problematic listings.
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What monthly, quarterly or annual costs will I pay as an owner in Palma de Mallorca?
What's the realistic monthly owner budget in Palma de Mallorca right now?
A realistic monthly owner budget in Palma de Mallorca for an occupied apartment typically runs from 350 to 700 EUR (365 to 730 USD), covering community fees, utilities, insurance, and a maintenance reserve.
The main recurring expense categories in Palma de Mallorca are community fees (80 to 250 EUR monthly), utilities like electricity, water, and internet (150 to 350 EUR monthly for an occupied home), and home insurance (20 to 60 EUR monthly equivalent).
The realistic range for monthly owner costs in Palma de Mallorca runs from around 250 EUR (260 USD) for a simple apartment with low community fees up to 800 EUR (830 USD) or more for larger properties with pools, lifts, or concierge services.
The monthly cost that varies the most in Palma de Mallorca is community fees, because they depend heavily on building amenities like swimming pools, elevators, security, and the overall size and age of the development.
You can see how this budget affect your gross and rental yields in Palma de Mallorca here.
What is the annual property tax amount in Palma de Mallorca in 2026?
As of early 2026, the annual property tax (IBI) in Palma de Mallorca is calculated at a rate of 0.445% of the cadastral value, which typically translates to roughly 0.18% to 0.27% of the market price (so around 900 to 1,350 EUR or 935 to 1,400 USD annually on a 500,000 EUR property).
The realistic range for annual IBI property tax in Palma de Mallorca runs from around 400 EUR (415 USD) for smaller apartments with low cadastral values up to 3,000 EUR (3,120 USD) or more for high-value villas or prime location properties.
Property tax in Palma de Mallorca is calculated based on the cadastral value (valor catastral), which is an administrative valuation typically set at 40% to 60% of the market value, not on the actual purchase price.
Exemptions or reductions on IBI in Palma de Mallorca may be available for certain categories like large families, properties with energy efficiency improvements, or specific social circumstances, though these require application and documentation.
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Spain. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
If I rent it out, what extra taxes and fees apply in Palma de Mallorca in 2026?
What tax rate applies to rental income in Palma de Mallorca in 2026?
As of early 2026, rental income tax in Palma de Mallorca for non-resident landlords is 19% for EU and EEA residents (including Iceland and Norway) and 24% for non-EU and non-EEA residents.
EU and EEA resident landlords in Palma de Mallorca can deduct certain expenses from their rental income before calculating tax, while non-EU landlords are generally taxed on gross rental income with limited deduction options.
The effective tax rate after deductions for typical EU resident landlords in Palma de Mallorca often falls between 10% and 15% of gross rental income, depending on how expenses are structured and documented.
Foreign property owners in Palma de Mallorca do pay different rental income tax rates than Spanish residents, with non-residents taxed at flat rates (19% or 24%) rather than the progressive income tax scale that applies to residents.
Do I pay tax on short-term rentals in Palma de Mallorca in 2026?
As of early 2026, short-term rental income in Palma de Mallorca is subject to the same non-resident income tax (19% for EU or 24% for non-EU) plus the Balearic Sustainable Tourism Tax (ITS) of 2 EUR per night per adult in high season and 0.50 EUR in low season, with VAT on top.
Short-term rental income is taxed at the same rates as long-term rental income in Palma de Mallorca, but short-term rentals have the additional cost of the tourism tax and require a licensed tourist accommodation registration to operate legally.
If you want to optimize your rental strategy, you can read our complete guide on how to buy and rent out in Palma de Mallorca.
Get to know the market before buying a property in Palma de Mallorca
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If I sell later, what taxes and fees will I pay in Palma de Mallorca in 2026?
What's the total cost of selling as a % of price in Palma de Mallorca in 2026?
As of early 2026, the total cost of selling a property in Palma de Mallorca typically ranges from 5% to 10% of the sale price before capital gains tax, depending on agent commission and legal fees.
The realistic range for selling costs in Palma de Mallorca runs from around 5% (if you sell privately with minimal legal help) up to 10% or more (with full-service agent and legal representation), plus any capital gains tax due.
The main cost categories when selling in Palma de Mallorca include real estate agent commission (3% to 6% plus VAT), legal and administrative fees (1% to 2%), and potentially early mortgage repayment penalties if applicable.
The single largest contributor to selling expenses in Palma de Mallorca is almost always the real estate agent commission, which at 3% to 6% plus 21% VAT can easily reach 20,000 to 40,000 EUR or more on a typical property.
What capital gains tax applies when selling in Palma de Mallorca in 2026?
As of early 2026, capital gains tax for non-resident sellers in Palma de Mallorca is 19% of the profit made on the sale, with the buyer required to withhold 3% of the total sale price and pay it to AEAT on the seller's behalf.
Exemptions to capital gains tax in Palma de Mallorca may apply if you reinvest the proceeds in a new primary residence, meet age requirements, or qualify under specific residency rules, though these exemptions are complex and often require professional advice to claim.
Foreigners do not pay an extra capital gains rate when selling property in Palma de Mallorca; the 19% rate applies based on tax residency status (non-resident) rather than nationality.
Capital gains in Palma de Mallorca are calculated as the sale price minus the original purchase price, with adjustments allowed for documented improvements, purchase costs, and inflation coefficients in certain cases.
We made this infographic to show you how property prices in Spain compare to other big cities across the region. It breaks down the average price per square meter in city centers, so you can see how cities stack up. It’s an easy way to spot where you might get the best value for your money. We hope you like it.
What sources have we used to write this blog article?
Whether it's in our blog articles or the market analyses included in our property pack about Palma de Mallorca, we always rely on the strongest methodology we can … and we don't throw out numbers at random.
We also aim to be fully transparent, so below we've listed the authoritative sources we used, and explained how we used them and the methods behind our estimates.
| Source | Why it's authoritative | How we used it |
|---|---|---|
| BOE - Balearic Tax Law | Official legally binding text for Balearic Islands property transfer taxes | We used it to confirm the exact 2026 ITP transfer tax brackets for resale homes in Palma de Mallorca. We also verified the AJD stamp duty rate for new-build purchases. |
| AEAT - IRNR Tax Rates | Spain's national tax authority explaining current non-resident rates | We used it to set the non-resident tax rates for rental income and capital gains. We also used it to separate EU/EEA versus non-EU treatment. |
| AEAT - Modelo 211 Procedure | Official AEAT procedure page for the 3% buyer withholding | We used it to explain the surprise cost when buying from non-resident sellers. We clarified timing and cash flow implications for buyers. |
| BOE - Registrar Fee Tariff | Official regulation setting how Land Registry fees are calculated | We used it to justify why registry fees are tariff-based and predictable. We explained why fees change with property value bands. |
| Banco de España - Mortgage Costs | Spain's central bank consumer information portal for banking products | We used it to separate purchase costs from mortgage costs. We listed fees buyers may still pay like property valuation. |
| Ajuntament de Palma - IBI Information | Palma city's official portal explaining local IBI administration | We used it to confirm IBI is a core local tax owners face. We aligned our language with the city's own tax framing. |
| Illes Sostenibles - ITS Calculator | Official Balearic government portal for the Sustainable Tourism Tax | We used it to quote per-night tourist tax bands for licensed holiday rentals. We explained seasonality and the discount after 9 nights. |
| Savills Spain - Buying Costs Guide | Well-known global real estate firm with transparent buyer cost overview | We used it to cross-check real-world fee ranges for lawyers, notaries, and agents. We used it as a sanity check against official statutes. |
| idealista - 2026 Buyer Cost Guide | Spain's largest property marketplace with regularly updated tax guidance | We used it to triangulate typical all-in buyer budget expectations. We kept explanations practical for non-professional readers. |
| PwC Spain - Non-EU Buyer Tax Proposal | Top-tier advisory firm summarizing legislative proposals with legal framing | We used it to clearly label the 100% non-EU tax as a proposal, not settled law. We showed what could change and what to monitor. |
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