ITP reduction on the Costa Blanca: from 10% to 9% starting June 2026
From June 1, 2026, buying a resale home in Orihuela Costa, Torrevieja, or anywhere in the Valencian Community will be noticeably cheaper. The Generalitat has approved a tax reform through the Law 5/2025 of May 30 that reduces the general rate of the Transfer Tax (ITP) from 10% to 9%—a permanent cut that directly benefits anyone buying a resale property across the Costa Blanca.
For domestic and foreign buyers who sign the deed from that date onward, the difference translates into thousands of euros freed up that can be put toward renovations, furnishings, or related expenses.
What the reform involves
The reduction applies to the ITP, the tax paid when buying a resale home from a private individual (it does not apply to new-build properties, which are subject to VAT). The key points of the reform are:
New general rate of 9%: applicable to homes valued at up to €1,000,000, versus the current 10%.
Homes above €1,000,000: the 11% rate is maintained, applied to the total value of the transaction.
Documented Legal Acts Tax (AJD): down from 1.5% to 1.4%, affecting mainly deeds for new-build properties and mortgages.
Effective date: June 1, 2026. Any deed signed before that date will be taxed at the old rate of 10%.
How much you save: examples from Orihuela Costa’s real listings
The cut represents a saving of €1,000 for every €100,000 of the purchase price. Applied to real properties on today’s Orihuela Costa market and surrounding areas:
Apartment in Playa Flamenca at €150,000: before €15,000 in ITP · now €13,500 · saving: €1,500
Bungalow in Villamartín at €250,000: before €25,000 in ITP · now €22,500 · saving: €2,500
Villa in Cabo Roig at €450,000: before €45,000 in ITP · now €40,500 · saving: €4,500
Villa in Campoamor at €700,000: before €70,000 in ITP · now €63,000 · saving: €7,000
Reduced rates that remain in place
The reform does not change the existing reduced-rate brackets, which continue to apply to specific groups as long as they meet the legal and income requirements:
Young people under 35 (first main home up to €180,000): rate of 6%.
Large families and single-parent families (main home up to €180,000): rate of 3%.
People with a recognized disability equal to or greater than 33% (main home up to €180,000): rate of 3%.
Official Protected Housing (VPO): reduced rates of 4% to 8%, depending on the case.
If you fit into any of these profiles, your reduced rate is still better than the new general 9%. It’s worth checking with a tax advisor before you sign.
What it means for foreign buyers in the Costa Blanca
The Southern Costa Blanca is home to one of the largest international buyer communities in the Mediterranean: Britons, Germans, Belgians, French, Scandinavians, and Russians choose Orihuela Costa, Torrevieja, Pilar de la Horadada, and Cartagena as a second home or a retirement destination.
For this kind of buyer—which typically purchases a main home or a second residence between €150,000 and €800,000—the ITP cut represents direct tax relief in the largest item of purchase-related costs. Since the general 9% rate applies regardless of the buyer’s tax residence, no foreign buyer is excluded from the benefit.
Is it a good time to buy in Orihuela Costa?
This reform brings Valencian tax rules in line with those in neighboring autonomous communities like Madrid or Andalusia, which had already been applying lower rates. Combined with price stability across the Costa Blanca, improved air connections, and a well-established range of international services, buying from June 2026 offers better terms than a year ago.
If you already have a transaction underway and the timelines allow, discussing with your agent and tax advisor whether it makes sense to postpone the signing until after June 1, 2026 could mean a real saving. For deals around €400,000, we’re talking about €4,000 freed up; for premium villas at €800,000, €8,000 straight into the buyer’s pocket.
At Sol y Costa Mediterránea, we know the Orihuela Costa and Southern Costa Blanca markets inside out. If you’re considering a purchase, get in touch with us and we’ll help you calculate your exact tax saving based on the property, your profile, and the signing date.
