Understanding what the cadastral value (valor catastral) of a property refers to is something that anyone entering the real estate market in Spain needs appreciates. It doesn’t matter if you are buying an investment property or a property to live in, the cadastral value of the property will impact you.
What is the cadastral value?
The cadastral value is a value assigned to a piece of real estate by the local (municipal) government for the purposes of collecting property taxes. For ex-pats and international Spanish real estate investors, it can make more sense to think of the cadastral value as the rateable value of a property. The value is determined by land registry data and local government assessment criteria. Therefore, properties of the same size and type in different regions of Spain often have widely different cadastral values.
A property’s cadastral value is typically significantly less than the corresponding real estate market value. It can also change on a yearly basis when new specifications are approved in local government annual budget legislation bills.
Why should you care about the cadastral value of a property?
Negotiating Power
A property will never sell for a value lower than its cadastral value. But many sellers will sell their properties close to the value if they are having debt issues with the local tax agency. Therefore, knowing the value gives you the upper hand in negotiations as you already know what the seller’s price floor is.
Tax Bills
Knowing the value can also stop you from purchasing properties that fall into very high property tax brackets. Non-residents still have to pay property taxes. So, even if you are buying the property as a buy-to-let unit or a holiday home, you are still going to want to pay attention to the cadastral value. Otherwise, you could find yourself in hot water with Spanish property tax collectors. Furthermore, you might have difficulty liquidating the property quickly when/if necessary.
Who can find out a property’s cadastral value?
Providing the entry does not contain any protected confidential data, anyone can obtain the public record cadastral information about a property. However, you will only be able to find out the name of a current property owner and the exact cadastral value if you meet at least one of the following criteria:
a) Are the owner yourself.
b) Have been given relevant authorization by a Spanish governing body to obtain the data.
c) Can prove that there is a valid reason (e.g. a special interest) why you need access to the data.
How do you find out the cadastral value?
As the owner of a property, the easiest way to find out the cadastral value is to check your municipal real estate tax receipt (IBI). This document is issued on an annual basis. Alternatively, if you need the data immediately, you can visit the land registry office in the province the property is located and file an information request. Keep in mind that you will need to show some type of photo ID, such as a passport, driver’s license, or residence permit.
You can also often access property cadastral value online by creating an account on the relevant local government agency website. Each region and province in Spain has different criteria as to who can access the data and what they must do to obtain it.
