Abaloo

Hi there.

We are thinking of moving to Majorca. I am self-employed with an internet business which I can run from anywhere in the world, and we would like to live in Majorca.

Does anyone have advice on costs? We will be renting initially, so looking at relevant taxes (council tax, local and government taxes) as well as electricity, water, etc costs.

Initially we will be in an apartment.

Any help greatly appreciated.

amideislas

Mallorca ("majorca" is a term only used in the UK & Ireland) is a very diverse place where cost of living can be as low or as high as you can afford.

It all depends on what you seek, where you live, in what kind of abode, and so on.

If you, like many others, feel it necessary to be surrounded by other Brits, then you'll probably have to live in the southwest, the most crowded and expensive area of the island.

If you don't need that, you can live for less than half the cost of the southwest if you settle inland or even on the east coast. Of course, if you have kids, things like schools and transport and all things related to kids will impact your choices.

Shopping and other important resources are everywhere, so unless you choose some really isolated out the boonies place, it won't matter which are of the island you choose. But if you need to find "special" stuff, the Palma metro area offers the most choices of shopping - you can get almost anything around Palma.

Also, if you are DIY inclined, you can save a fortune. Lots of big DIY stores selling everything, and very competitive, too.

So, whilst I can't offer you much in terms of hard numbers because it varies greatly, I can only repeat that you can pay a lot or a little, depends on what you need, and what you fancy.

Abaloo

Thanks for your reply. We really don't need to be surrounded by Brits, but we do have young children so schooling is important.

I'm not looking for rental prices here. I am just looking for guidance on taxes (especially council tax equivalent), electricity prices, etc.

Lynn R

If you will be renting, then you should not have to pay the IBI (equivalent of Council Tax), nor any community fees, as these are normally the responsibility of the landlord. You should just pay the rent plus utility bills.

It's nigh on impossible to give a figure for electricity, water, etc. bills as everyone's usage is different. The standing charges go up in bands depending on how much "potencia" the property has (ie the maximum amount of current which the contract allows to be in use at any time). Water is always metered so again bills depend totally on usage.

Abaloo

Hi Lynn. Thanks so much for that, really helpful. This helps to give me a basis for finding out more.

Rosemary

As Concierge for the Spanish section of BE I would like to say hello and welcome.

BE is a very large expat website, so if you have problems finding your way around we have concierges who will try to direct you. The moderators for the Spanish forums are Mitzyboy and Fred James, moderators are there to ensure that the site runs smoothly within the rules of BE. Problems and complaints should always be addressed to a moderador who will look into the matter and deal with it efficiently and fairly. Our members who post in the Spain Forums are friendly and helpful with a wealth of knowledge of the issues of living in Spain. At the top of the page you will find a quirkily named thread called Free Beer which is full of important and useful information. Hope you enjoy your time participating in the forums.

Please let me know if you need any further help.

Rosemary

amideislas

OK well, you just exposed the elephant in the room: Kids. That puts you into a much more limited category, but not necessarily;

IF your kids can be fluent in Spanish, they can go to a public school, which (I'm told) are very good in many parts of the island.

IF they speak Spanish fluently, that also means you aren't chained to the Palma area and the associated costs, where an international school will cost as much as €15K per year per student, your 100 square meter rental apartment will cost as much as €1800 per month, and your children could be exposed to some things many adults might prefer to avoid.

If you were able to settle in say, Manacor, for example, a very nice, peaceful non-touristy town with largely a native Mallorquin population, very low crime and plenty of living resources such as major supermarkets, clothing, DIY shops, good internet infrastructure, good hospital, and good public schools, you could probably get a 200 square meter 3 bedroom place just on the outskirts with a large garden, and maybe even a pool for as little as say, €800 per month.

But the kids would have to be fluent in Spanish at least, Catalan would be better.

Electricity isn't cheap, and there are lots of "hidden" costs, but about €100 per month for a typical family is a good rule of thumb.

Telephone/internet isn't cheap either - figure about €50 per month.

Taxes? That depends on how much you make and what you own. MOT and road tax and car insurances are not too bad - about €1000 per year (combined) depending on your car(s) is probably a reasonable guess. Health insurance is of course compulsory, but the social insurance costs are palatable.

Abaloo

Hi Amideislas. Thanks so much for such a helpful response. Is fluent Spanish a necessity for the public schools, or some Spanish and learning?

We would definitely prefer to be in a Spanish setting, rather than an English one.

One other question, IBI and community fees, what are they as a rule of thumb?

amideislas

No problem, happy to help if I can.

IBI is levied on homeowners, and varies greatly depending on district, value of property, "family" ownership (inheritance) and a number of other factors. When you do your due diligence prior to purchasing real estate, you'll find out what that property taxes will be assessed after it's in your name.

"community" fees or contribucion vary from district to district, but we pay about €500 per year in total. (often inaccurately referred to as rubbish collection, although it pays for more than just rubbish, and rubbish isn't "collected" at your home - there are just big bins all over the place where you put your rubbish).

Fluent Spanish (Castellano) at a minimum, Catalan is the official language in schools here, though Castellano is a required and simultaneously taught.

I believe they are obliged to accept local resident children regardless of whether they are fluent, however, they will warn you that they will be extremely learning impaired without speaking the language.

The good news is that kids are language sponges. The earlier you get them started speaking the language, the faster they'll become fluent. I know a few German kids who couldn't speak a word of Spanish just a few months ago that are nearly fluent now.

Abaloo

Thank you so much. The clidren are very interested in learning the language, and their mum (my wife) studied the language and is fluent. So hopefully they will have learned from her.

We will be renting at least in the first year or two.

I can't tell you how helpful this all is. I have read the guides etc, but personal advice is always worth more.

amideislas

I forgot to mention water. A rather precious resource here.

We have our own Pozo (well), which is much less expensive than using city water. Using the well, there are operating costs (electricity) also maintenance costs and burdens (pump, filtration, cistern, etc).

I know city water ends up being much more expensive per cubic meter, but I honestly don't know the costs. We don't measure the costs of operating the pump(s) independently from the rest of the electricity, so it's difficult to know for sure.

Abaloo

Thank you. I doubt we will be in a position to have a well, I'm afraid. Where are you situated?

Lynn R

See here for an explanation of what IBI is and how it is calculated. Inheritance has nothing to do with it, and the valor catastral of a property (upon which the amount of IBI payable is based) does not change each time it is sold, only when all catastral values in an area are revised which happens every few years (or possibly if a property is extended or substantially changed in some way eg adding a pool and the new details are registered).


http://www.tumbit.com/how-to-guides/...alculated.html

If you buy a property, the vendors must provide a copy of the most recent IBI bill so you can see how much it is likely to be. The only difference after you buy might arise if the previous owners had been receiving a discount of some kind from the Ayuntamiento (some give discounts for various reasons but by no means all of them), which would not be transferable to the new owner unless they applied for it.

Community fees are charged if your property is on an urbanisation (like a housing estate) or in an apartment complex - in the UK they would be called service charges. They cover things like maintenance of common areas and facilities like gardens and swimming pools, exterior painting, lift maintenance, etc. In Spanish urbanisations they often have to cover things like street lighting too.

Abaloo

Thank you. I am so pleased I stumbled across this site, such a great resource and so many questions answered already.

It is easy right now to focus on the potential negatives for the children, but there are so many positives there too.

amideislas

Well, yes, that's what written, but we all know that reality has a funny way of not being consistent with what's written.

Yes, it's true in terms of inheritance not being a specific factor written into official IBI policy, but inheriting a property is very different than selling it.

There's no shortage of properties around here passed down through generations, worth millions in some cases, but the owners pay little more IBI than their grandparents or great-grandparents (through numerous loopholes). That's one reason why so many Mallorquins are adverse to selling these old places, even if they are too big or impractical for them. They get too good of a tax deal if they just keep it. If they had to buy another property, their taxes could be orders of magnitude higher.

Selling a property is a different issue altogether. It's obligatory to reassess the value of the property and thusly, the IBI. So when you are provided a previous IBI bill showing that the current inheritor pays €150 per year for an expensive property, don't get all excited. It will be a lot more after it's in your name.

And of course, the Ayuntamiento will make their own assessment of value of the property and assess taxes on that amount, rather than what you actually paid for it.

In Mallorca, all homeowners must pay compulsory contribucion, which pays for things like rubbish and various other public services. Ours is just under €500 per year, but we have a lot of square meters of arguable "living" space (in reality, anything resembling a "floor", is considered "living space" - including any "finished" surfaces around your pool, patio or garden), which I believe is how it's assessed.