They are commonly called "notary fees," but the largest share never reaches the notary: most of it is taxes paid to the government and local authorities. Understanding what these costs contain, and the difference between an existing and a new-build home, spares you a nasty surprise when you finalize your financing plan. Here is how to estimate them precisely, with worked examples and a step-by-step method to back it up.
When you buy a property, the closing costs (formally known as acquisition costs) are added to the price of the property and are settled on the day you sign the deed of sale. In most financing structures they are not covered by the main loan: you therefore need to set them aside as a down payment. Estimating them accurately up front means securing your budget and avoiding a stalled purchase agreement for lack of cash.
This matters well beyond the individual buyer. A small business or SME buying its own walls, a retail unit or a floor of offices runs into exactly the same mechanics: the listed price is never the final cost. A business owner who overlooks this line in their cash-flow plan risks weakening their working capital at the worst possible moment. Knowing how to estimate these costs is therefore a management skill, not just a buyer's reflex.
What closing costs are really made of
Contrary to popular belief, the notary's fee represents only a fraction of the total. Acquisition costs break down into four main categories, which are worth knowing to understand why they are so hard to negotiate.
- Transfer taxes : the taxes paid to the department and the municipality. This is the heaviest item, around 5.80% of the price for existing homes in most departments.
- The notary's fees : their regulated remuneration, set by a national scale that decreases by bands. This is the only share that actually pays the notary's office.
- Disbursements : the sums the notary advances on your behalf (planning documents, surveyor, land registry, building management).
- The property security contribution : the land registration tax collected by the government for recording the sale, equal to 0.10% of the price.
The notary does not keep it all
On costs of around 8% for an existing home, the taxes (transfer taxes and contribution) account for nearly three quarters of the total. The notary's own fees, by contrast, amount to roughly 1% of the property price. In other words, most of the money goes to public coffers, not into the notary's pocket.
Why this breakdown matters for your budget
Understanding this split is not a theoretical detail. Because the taxes are proportional to the price, the only real way to lower the bill is through the price of the property itself or by allocating a value to what is not pure real estate (furniture, equipment). The negotiable share is marginal: do not expect a discount on transfer taxes, they are set by law.
Existing or new-build: the difference that changes everything
This is the factor that swings the bill the most. The level of transfer taxes depends directly on the nature of the property: an existing home or a new-build home.
Existing homes: so-called "full" costs
For an existing home (more than 5 years old, or resold after a first occupancy), transfer taxes are levied at the full rate. Acquisition costs are commonly estimated at around 7 to 8% of the price. This is the most frequent situation: the vast majority of transactions involve existing property. A couple buying a village house, an investor taking on an apartment to renovate, or an SME buying an existing unit all fall into this case.
New builds: reduced costs
For a new-build home (an off-plan purchase or a property sold for the first time), transfer taxes are sharply reduced because the sale is subject to property VAT. Acquisition costs then drop to around 2 to 3% of the price. Be careful, though: the listed price of a new-build home is generally higher for the same floor area, which partly offsets the saving on costs. A new build already includes the VAT in its sale price, so the reduction applies only to transfer taxes.
| Type of property | Estimated acquisition costs | Dominant item |
|---|---|---|
| Existing home | 7 to 8% of the price | Transfer taxes (about 5.80%) |
| New-build home (off-plan) | 2 to 3% of the price | VAT already in the price, reduced duties |
| Building plot | varies by regime | Depending on VAT liability |
| Commercial unit or offices (pro) | depends on regime and age | Seller's VAT regime is decisive |
A possible rise in departmental duties
Since 2025, departments have been able to temporarily raise their share of transfer taxes. The applicable rate therefore depends on the department where the property is located: always check the local rate rather than blindly applying a national average. A difference between departments can noticeably change the final amount.
Concrete worked examples
Nothing beats real cases to picture the impact on your budget. Here are several common scenarios, with average rates given for guidance (the exact calculation depends on the banded scale and on the department).
| Scenario | Property price | Estimated costs | Total to finance |
|---|---|---|---|
| Existing apartment | €200,000 | about €15,800 (7.9%) | about €215,800 |
| Existing house | €350,000 | about €27,300 (7.8%) | about €377,300 |
| New-build apartment (off-plan) | €250,000 | about €6,250 (2.5%) | about €256,250 |
| Existing commercial unit | €180,000 | about €14,000 (7.8%) | about €194,000 |
The gap is immediately obvious: on a property at €250,000, switching from new-build to existing pushes the costs from around €6,000 to nearly €20,000. This difference is settled in cash on the day of signing: it must appear in black and white in your financing plan from the moment you start looking. To quickly check what percentage of the price your costs represent, a simple percentage calculation is enough to validate an estimate received from a seller or an agency.
The right reflex before making an offer
Estimate the costs before you even make an offer, not after. By factoring in this line from the outset, you know exactly how high you can go on the price without overreaching. Many buyers discover the real amount too late and have to scale back their entire financing structure.
Estimate your closing costs in seconds
Enter the property price and indicate whether it is an existing or new-build home: the tool instantly calculates a detailed estimate of the acquisition costs to plan for.
How to estimate your costs step by step
To get a reliable estimate before meeting your notary, work through the following order. This method works just as well for a primary residence as for the purchase of business premises.
- 1Identify the nature of the property: existing or new-build. This is what determines the level of transfer taxes.
- 2Note the net seller price, excluding furniture. Furniture (fitted kitchen, furnishings) can be deducted from the taxable base if it is priced separately.
- 3Apply an indicative rate: around 7.5 to 8% for existing homes, 2 to 3% for new builds, as a first approximation.
- 4Check the transfer tax rate for the department concerned, which can slightly change the result.
- 5Add this sum to your down payment: the costs are generally not covered by the mortgage.
- 6Compare the total against the amount you can borrow to confirm the project remains financeable.
The furniture tip
If the property includes furniture or a fitted kitchen, have them priced separately in the purchase agreement. Since closing costs apply only to the real estate, this allocation legitimately reduces the taxable base and therefore the final bill. The value of the furniture must remain realistic and justifiable: overstating it can be challenged.
Common mistakes to avoid
Some mistakes come up again and again and cost dearly, in money as well as in time. Knowing them in advance protects you from a weakened purchase agreement or a rejected loan application.
- Forgetting the costs in the down payment : assuming the loan will cover everything, then discovering you have to pull several thousand euros out of your own pocket at signing.
- Confusing new-build with recent : a property under five years old, resold after a first occupancy, shifts into the existing-home regime, with full costs.
- Applying a national average instead of the department's rate : depending on the location, the result can vary by several hundred euros.
- Overlooking disbursements and surveys : these small lines add up and inflate the final bill beyond the rough estimate.
- Overstating deductible furniture : an excessive allocation can be reclassified and only brings a marginal gain.
Closing costs and borrowing capacity
Acquisition costs weigh directly on your project, because they come on top of the price. Two scenarios arise depending on your situation.
- Financing with a down payment : this is the classic case. Your down payment covers at least the closing costs, which banks appreciate when reviewing the application.
- 110% financing : some banks finance both the property AND the costs, but this structure is rarer and is negotiated with a strong application (stable income, low debt ratio).
In every case, once your costs are estimated, it remains to check that the loan's monthly payment stays affordable. Consider simulating your mortgage to test different terms and rates: this lets you set the overall budget, costs included, before you commit. It is this combination of costs plus monthly payment that determines the real feasibility of the project, not the listed price alone.
Acquisition costs are almost non-negotiable: they are mostly taxes. The only real room for maneuver lies in the property price and in the allocation of furniture value.
The case of businesses: premises and commercial walls
For a small business or an SME, buying its premises rather than renting them is a structuring decision. Acquisition costs follow the same logic as for an individual, but the seller's tax regime (VAT-liable or not) and the nature of the property (existing unit, new-build floor, commercial walls) can noticeably change the calculation. A business owner is well advised to have these costs priced very early, because they tie up a significant share of cash on the day of signing.
On the organizational side, buying premises also generates a pile of documents to manage: purchase agreement, surveys, deed, certificates. Digitizing and signing these documents electronically saves precious time and avoids the postal back-and-forth that delays a deal. A well-organized file from the start makes exchanges with the notary and the bank easier.
Renting or buying your premises
Buying ties up capital and acquisition costs, but builds equity and stabilizes expenses. Renting preserves cash flow and flexibility. Always include closing costs in the comparison: they are part of the real cost of entering ownership.
Frequently asked questions
How can I estimate my closing costs quickly?
First identify whether the property is existing or new-build, then apply an indicative rate to the price: around 7.5 to 8% for existing homes and 2 to 3% for new builds. For a more precise result, use a simulator that accounts for the banded scale and the department where the property is located.
How much do closing costs come to for an existing home?
For an existing home, budget on the order of 7 to 8% of the property price. The largest share corresponds to transfer taxes levied at the full rate, around 5.80% in most departments. The notary's own fees represent only about 1%.
Why are the costs lower on a new build?
Because a new-build home sold for the first time is subject to property VAT, which is already included in the price. Transfer taxes are then sharply reduced, which brings acquisition costs down to around 2 to 3% of the price, versus 7 to 8% for existing homes.
What down payment should I plan to cover the closing costs?
In a classic setup, banks expect your down payment to cover at least the acquisition costs. So plan for the equivalent of 7 to 8% of the price for an existing home. Some institutions finance the property and the costs at 110%, but this structure remains rarer and requires a solid application.
Can closing costs be reduced?
The margin is limited because they are mostly taxes. You can, however, have the furniture (fitted kitchen, furnishings) priced separately in the purchase agreement: this legitimately reduces the taxable base. Negotiating the property price remains the main lever.
In summary
Estimating your closing costs comes down to one central question: is the property existing or new-build? For an existing home, budget around 7 to 8% of the price; for a new build, more like 2 to 3%. Most of this sum corresponds to taxes, not the notary's fee, and is settled in cash at signing.
- Breakdown : transfer taxes (the heaviest), the notary's fees (about 1%), disbursements and the property security contribution.
- Existing : around 7 to 8% of the price, transfer taxes at the full rate.
- New build (off-plan) : around 2 to 3%, reduced duties because subject to property VAT.
- Budget : set these costs aside as a down payment, they are not always financed by the loan.
- Method : nature of the property, net seller price, indicative rate, department rate, added to the down payment.
To fine-tune your purchase budget with no nasty surprises, a dedicated simulator gives you an immediate estimate based on the price and the type of property. At TC Automation, we build simple, reliable business tools that save time on these everyday calculations, for individuals and real estate professionals alike. If you want to equip your business or automate your recurring estimates, let's talk about your project.
