The cadastral value, in Spain called Valor Catastral, was created to be able to calculate different Spanish tax types, first of all the Spanish property tax (Impuesto sobre Bienes Inmuebles or IBI). Therefore, the cadastral value plays a major role when you want to buy a property in Mallorca. The Royal Legislative Decree 1/2004 and the implementing regulations serve as the legal basis. However, real estate buyers often ask themselves how the cadastral value is actually composed, since there are sometimes large differences in seemingly equivalent properties. In this article, we therefore take a closer look at the cadastral value and give you an overview of the most important information.
What does the cadastral value in Spain mean?
The value of the land and the type of development form the cadastral value in Spain. This is prepared individually for each land registry unit. The cadastral office, also known as Oficina de Catastro, prepares a value table for each municipality, which can be used to calculate the cadastral value for the respective unit. Different criteria and valuation bases as well as the municipal planning specifications are taken into account:
- Real estate location
- Urban planning
- Material cost of the object
- Fees and taxes
- Use of the property
- Age of the object
- Historical features
- Production costs and profits
- Market development and market values
- and much more.
When calculating the cadastral value, the market value of a property may not be exceeded. If the buyer has a verifiable indication that this is the case, he can enforce an audit by submitting an appraisal. The cadastral value in Mallorca adjusts every 10 years to inflation and is subject to fluctuations if it is a new construction or a property is changed in its original use.
How is the cadastral value calculated?
There are basically two types of cadastral value calculation: the individual and the collective valuation procedure. The first one is used when the cadastral office registers a property for the first time or when there is a change. The change can be, for example, a reconstruction. In this case, the new criteria for the real estate unit are synchronized by means of individual valuation. The second method of calculating the cadastral value becomes relevant when it is necessary to adjust the base value to the market value if there are significant differences.
The adjustment of the cadastral value in Mallorca
Although the cadastral value is supposed to be adjusted regularly, the update is often simply delayed. For example, the value in Palma has not been adjusted since 1996. In 2013, the step was made up, which directly led to a doubling of the previous cadastral values in Mallorca. However, increases in cadastral value are spread evenly over 10 years. In other regions, updates can also lead to sometimes large fluctuations and even exceed the market value. We at Neptunus International Real Estate therefore always check the current cadastral value and intervene in a real estate purchase if there is a suspicion that the cadastral value is excessive.
Always fully informed about cadastral value and taxes in Mallorca
The cadastral value is important because it has a direct influence on the amount of numerous taxes. With us you will always receive in advance all the important information about one-time and current taxes on a property purchase in Mallorca. We at Neptunus International Real Estate are happy to inform you personally about the cadastral value and are always available to advise you. Contact us right away.
