Hi everyone, I’ve recently been house hunting in Madrid and am preparing to apply for a mortgage. The bank mentioned a mandatory procedure called Tasación, which is what we commonly refer to as a property appraisal. After doing some research, I realized this fee isn’t cheap at all. So today, I’m starting this thread to discuss what this appraisal fee is all about, what to watch out for, and to keep a record for myself.
What is a Property Appraisal?
Simply put, when you apply for a mortgage to buy a house, the bank needs to know the property’s true market value to ensure the loan they provide is secure. Therefore, the bank will require an independent, third-party appraisal company certified by the Bank of Spain to assess the property. This appraisal report, which has a specific appraisal timeline, is a strict legal requirement for the loan to be granted and is typically valid for 6 months.
Who Actually Pays the Appraisal Fee?
This is the question everyone is most concerned about. Before the new Spanish credit law came into effect in 2019, this fee was almost always borne by the buyer. But things are different now! Under the new law, banks must cover most of the upfront costs to win your business, and this includes the appraisal fee. So, the common situation now is: the bank pays the appraisal fee. The days of the buyer paying are over! However, be careful: if you hastily hire an appraisal company yourself before choosing a bank, you’ll have to pay for it out of your own pocket. Plus, other banks may not accept that report, meaning you’ve wasted your money.
Market Rates for Appraisal Fees
Although the bank usually pays now, it doesn’t hurt to know the market rates in case you encounter a special situation. The appraisal fee isn’t fixed; it mainly depends on the property’s value, type, and location. I’ve put together a rough guide for property valuation with an approximate price range:
| Property Value | Appraisal Fee |
|---|
| Under €100,000 | €250 - €350 |
| €100,000 - €250,000 | €350 - €500 |
| €250,000 - €500,000 | €500 - €700 |
| Over €500,000 | From €700 |
How to Choose an Appraisal Company?
In theory, as the client, you have the right to choose any company from the Bank of Spain’s list of certified appraisers. In practice, however, the easiest method is to use the appraisal company recommended by your mortgage bank. This is because banks have their own ‘whitelist’ of trusted partners. If the company you choose isn’t on their list, the bank might not accept the report, which could stall your mortgage process. Therefore, the safest bet is to confirm with your bank manager and let them handle the appraisal arrangements—after all, they’re the ones paying for it.
The Tasación is a crucial step in the mortgage process when buying a home. Fortunately, the law is now on the consumer’s side, so we no longer have to bear this cost ourselves. I hope my sharing helps those of you who are also on the house-hunting journey. Wishing everyone success in finding their dream home!
