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C & D Solicitors submitted an article to Sur in English about understanding Reference Values and Expert Evaluation, which is the subject of this article.

Survey Spain has recorded the Reference Values of properties they have valued for the past year.  The current average is 72.8% of the asking/buying price or market value. The maximum has been 168% and the minimum only 23%.

The tax authority may demand tax on the actual price, even if reference value is lower. Caution: Future Capital Gains may be calculated using the lower reference value. In that case, the tax could be substantially higher than it should be. Solicitors recommend getting a mortgage valuation at the time of purchase if the Reference Value significantly differs from the market value or price paid. The tax authority is unlikely to treat a retrospective valuation with the same respect when you sell

Mortgage valuation is not necessarily the current market value of the property

Remember that the mortgage valuation is not necessarily the current market value of the property.  A recent court case has proved this. See our 2017 article Why are tasador valuations always wide of the mark? – Survey Spain  and a new one reporting the recent case, where a valuation based on the Bank of Spain mortgage principles was shown to be only 50% of the current market value prepared by Survey Spain’s Expert Witness and accepted by the Court.

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