The Real Cost of Owning a Holiday Home in Spain

What Nobody Tells You Before You Buy

Everyone talks about the purchase price. Far fewer people talk about what happens after you get the keys. Owning a holiday home in Spain involves a set of recurring annual costs that, if you don't budget for them, can turn your dream home into a financial headache.

This guide gives you the honest numbers. We've broken down every annual cost of owning a Spanish holiday home, using three realistic scenarios: a two-bed apartment, a three-bed townhouse, and a detached villa. All figures are based on actual costs reported by UK owners on the Costa del Sol in 2025–2026.

Annual Costs at a Glance

Cost category	2-bed apartment	3-bed townhouse	Detached villa
IBI (council tax)	€400–€800	€600–€1,200	€1,000–€3,000
Basura (waste tax)	€100–€200	€150–€250	€200–€350
Community fees	€1,200–€3,600	€1,800–€4,800	€0 (or €1,200–€6,000)
Non-resident tax	€150–€300	€200–€500	€300–€800
Insurance	€200–€500	€350–€700	€500–€1,500
Utilities	€600–€1,200	€900–€1,800	€1,500–€4,000
Maintenance	€300–€800	€500–€1,500	€1,500–€5,000
Property management	€600–€1,200	€600–€1,200	€1,200–€3,000
TOTAL (annual)	€3,550–€8,600	€5,100–€11,950	€6,200–€23,650

That's roughly €300–€700/month for an apartment, €425–€1,000/month for a townhouse, and €500–€2,000/month for a villa. These numbers are real. Budget for the mid-range and you won't be caught out.

Cost #1: IBI (Annual Property Tax)

The Impuesto sobre Bienes Inmuebles is Spain's equivalent of council tax. Every property owner pays it, regardless of residency status.

How it's calculated: A percentage (set by each municipality, typically 0.4–1.1%) of the valor catastral (cadastral value). The cadastral value is usually 30–50% of market value, so the effective rate is quite reasonable.

When it's due: Annually, typically September or October. Most owners set up a direct debit from their Spanish bank account. Some municipalities offer a small discount (3–5%) for early payment.

Real examples:

• €300,000 apartment in Fuengirola: IBI approximately €550/year
• €500,000 townhouse in Estepona: IBI approximately €850/year
• €1,000,000 villa in Marbella: IBI approximately €2,200/year

Cost #2: Community Fees

If your property is in an apartment block, urbanisation, or any development with shared amenities, you'll pay monthly community fees (cuota de comunidad). These are set by the community of owners and cover shared costs.

What they cover:

• Communal garden and pool maintenance
• Building insurance
• Lift maintenance
• Cleaning of communal areas
• Security (if applicable)
• Reserve fund (mandatory 10% of annual budget)

Typical monthly fees:

• Basic apartment block (no pool): €60–€120
• Apartment with communal pool and gardens: €120–€250
• Luxury complex with gym, concierge, multiple pools: €250–€500
• Golf resort urbanisation: €200–€400

Watch out for: Derramas — special assessments for major works (new roof, lift replacement, façade renovation). These can run into thousands of euros. Before buying, ask to see the community's AGM minutes and check whether any major works are planned or required.

Cost #3: Non-Resident Tax (Modelo 210)

Even if you don't rent your Spanish property, you owe annual non-resident income tax. Spain's tax system assumes you benefit from owning the property and applies an "imputed income" calculation.

The calculation:

• Take 1.1% of the cadastral value (or 2% if the value hasn't been updated since 1994)
• Tax that amount at 19% (for EU/EEA residents; UK residents currently taxed at 24% as non-EU)

Example: A property with a cadastral value of €150,000 (market value approximately €400,000):

• Imputed income: €150,000 × 1.1% = €1,650
• Tax at 24% (non-EU): €396/year

This is filed annually via Modelo 210, due by 31 December of the following year. Most owners have their lawyer or gestor handle this for €50–€100.

Cost #4: Insurance

Building insurance is legally required if you have a mortgage. Even without a mortgage, contents and liability insurance is strongly recommended — especially if you rent the property out.

Typical premiums:

• Apartment (building + contents): €200–€500/year
• Townhouse: €350–€700/year
• Villa: €500–€1,500/year (higher if you have a pool)

Building insurance for an apartment is often included in community fees (covering the structure), but you'll still need contents cover.

Cost #5: Utilities

Even when you're not in Spain, you'll pay standing charges for electricity, water, and internet. When you are there, consumption adds up — especially air conditioning in summer.

Typical costs for a holiday home used 8–12 weeks a year:

• Electricity: €40–€80/month (standing charge + summer AC). Budget €600–€1,200/year.
• Water: €20–€40/month. Includes standing charge for sewage. Budget €250–€500/year.
• Internet: €30–€50/month for fibre. Essential even when you're away if you have smart home devices or security cameras. Budget €360–€600/year.
• Gas: Bottled gas (butane) for cooking: €15–€20 per bottle, 4–6 per year. Negligible.

Villa owners: Pool running costs add €800–€2,000/year (pump electricity, chemicals, annual service). Garden irrigation can add €500–€1,500/year in water costs.

Cost #6: Maintenance

Properties in Mediterranean climates need regular maintenance. Sun, salt air, and temperature extremes take their toll.

Budget for:

• Annual boiler/AC service: €100–€200
• Painting (exterior, every 3–5 years): €1,000–€5,000 (amortise annually)
• Plumbing and electrical repairs: €200–€500/year average
• Pest control: €100–€200/year
• Pool maintenance (villas): €100–€200/month
• Garden maintenance (villas): €100–€300/month

The 1% rule: A common rule of thumb is to budget 1% of the property's value annually for maintenance. A €400,000 property = €4,000/year maintenance fund. This feels high for an apartment but about right for a villa with a pool and garden.

Cost #7: Property Management

If you're not in Spain full-time, you need someone looking after the property. This is non-negotiable — empty properties deteriorate quickly, and you need someone to handle emergencies.

Basic key-holding service: €50–€100/month. Someone checks the property weekly, forwards post, meets tradespeople, and handles emergencies.

Full management (including rentals): 15–25% of rental income, or €200–€400/month flat fee. Includes guest check-in/out, cleaning coordination, maintenance oversight, and owner reporting.

Can Rental Income Cover the Costs?

This is the question everyone asks. The honest answer: it depends on the property, location, and how many weeks you want to use it yourself.

Realistic rental scenario for a two-bed apartment in Estepona or Fuengirola:

• Peak season (July–August): €1,200–€1,800/week
• Shoulder season (May–June, Sept–Oct): €700–€1,100/week
• Winter: €400–€700/week (or long-let at €800–€1,200/month)

If you rent for 16–20 weeks and use the property yourself for 6–8 weeks, gross rental income of €12,000–€18,000 is realistic. After management fees (20%) and rental taxes (24% for non-EU on gross), net income might be €7,000–€11,000.

Against annual running costs of €4,000–€7,000 for an apartment, rental income can cover your costs and leave a modest surplus. But it won't cover your mortgage payments if you have one — and it won't make you rich. The real returns are in capital appreciation and lifestyle value.

Costs Unique to UK Owners Post-Brexit

• 90-day tracking: You need to monitor your days in Spain carefully. Overstaying risks fines. Some owners use apps to track Schengen days.
• Travel insurance: The GHIC card provides limited emergency cover but doesn't replace travel insurance. Budget €200–€600/year for comprehensive annual cover.
• Spanish tax filing: Non-resident tax returns cost €50–€150 per filing if using a gestor or lawyer.
• UK tax reporting: You must declare Spanish property and any rental income on your UK tax return. Consider specialist cross-border tax advice (€300–€600/year).

The Total Picture

For a typical UK buyer with a two-bed holiday apartment on the Costa del Sol (value €300,000–€400,000):

• Annual running costs: €4,500–€7,000 (£3,800–£6,000)
• Monthly equivalent: €375–€580 (£320–£500)
• Per week of personal use (8 weeks): €560–€875 (£480–£750)

Compare that last number to hotel costs in the same area and the economics start to make sense — especially once you factor in capital appreciation of 5–8% annually.

Frequently Asked Questions

What costs can I deduct if I rent the property?
EU/EEA residents can deduct property-related expenses from rental income (maintenance, insurance, community fees, IBI, mortgage interest). UK residents as non-EU nationals currently cannot deduct most expenses and are taxed on gross rental income at 24%. This is a significant disadvantage and a strong argument for professional tax advice.

What if I don't rent the property at all?
You still pay all the costs listed above. The non-resident imputed income tax applies whether or not you rent. The only cost you avoid is property management (if you're willing to self-manage during visits).

Are costs lower in cheaper areas?
Taxes (IBI, non-resident) are lower because they're based on property value. Community fees depend on the development, not the area. Maintenance and utilities are similar everywhere. A €200,000 apartment in Torremolinos costs roughly €1,000–€1,500 less annually than a €400,000 apartment in Marbella.

Use our buying costs calculator for purchase costs, and check our costs and taxes guide for the full tax picture.

Are you an estate agent on the Costa del Sol? List your properties where UK buyers are already looking.