Difference between Cadastral Value, Reference Value and Market Value

The terms Cadastral Value, Cadastre Reference Value and Market Value may seem similar, but there are important differences between them. Knowing them is essential if you are thinking of buying or selling, or have inherited a property.

Difference between cadastral value and reference value

The cadastral value is an administrative value assigned by the Directorate-General for the Cadastre (RDL 1/2004 and RD 1020/1993), used to calculate municipal taxes such as the property tax (IBI) or the municipal capital gains tax (IIVTNU). It is rarely updated and is the sum of the land value and the building value.

The Cadastre reference value was introduced by Law 11/2021 and came into force in January 2022, to prevent under-declaration in sales, donations or inheritances. It better reflects real market prices according to the Land Registries and is published every year.

It is used as the tax base for property transfer and stamp duty (ITP and AJD) and for inheritance and gift tax (ISD). It is calculated from homogeneous areas, typical property products, market studies and a 10% reduction.

Difference between cadastral value and market value

• The market value is the price at which the property could be sold under normal conditions (Order ECO/805/2003). It is essential in official appraisals.
• The cadastral value does not reflect the market because it is updated so rarely.

In short

1. The cadastral value is used for municipal taxes (IBI, IIVTNU).
2. The reference value is the minimum tax base for ITP, AJD and ISD.
3. The market value would reflect the real price at which you could sell your property.

If you need a mortgage appraisal, rely on companies approved by the Bank of Spain such as Tasvalor.