Aid for Buying a Home as a Young Adult: Everything You Need to Know

Myths and Realities About Buying a Home Before 35

Buying your first home at a young age can seem like a complicated task. The common belief is that age will be a limiting factor, when in reality, it can actually become an advantage. Here are some of the most widespread beliefs:

• Myth: Age — being young — is a problem when buying a home.

  • REALITY: Some banks offer financial products specifically designed for buyers under 35, such as youth mortgages. These typically come with longer repayment terms, lower interest rates, or even lower down payment requirements.

• Myth: I need to have large savings.

  • REALITY: Although it's advisable to have about 30% of the total cost saved for expenses and the down payment, young buyers can benefit from mortgages that cover up to 95% of the home's value.

• Myth: It's harder to get public aid.

  • REALITY: The State Housing Plan, ICO loans, and assistance from many regional governments are designed specifically to make homeownership more accessible for those under 35.

There are different types of aid available if you know the process. Let one of our real estate agents guide and advise you. We don’t just help you find your dream home — we support and listen to you every step of the way so you don’t have to worry about a thing.

National and Regional Housing Aid for Young Buyers

One of the biggest advantages of buying a home under the age of 35 is access to tax exemptions and benefits that can significantly reduce costs. Depending on your autonomous community, you may be eligible for different types of assistance. Here are some of the most common:

2025 State Housing Plan

The State Plan for Access to Housing 2022–2025, established by Royal Decree 42/2022 of January 18, includes a specific line of aid for individuals under 35 looking to purchase a primary residence. These are its main features:

• Direct subsidy of up to €10,800, as long as it does not exceed 20% of the purchase price of the property.

• Age limit: you must be under 35 at the time of application.

• Primary and permanent residence: you must live in the home as your main residence for at least 5 years.

• Maximum income: your annual income must not exceed 3 times the IPREM (Public Indicator of Multiple Effects Income), or more depending on family situation or location.

• Location: priority is given to homes located in municipalities with fewer than 10,000 inhabitants.

Reduction of the Property Transfer Tax (ITP)

The Property Transfer Tax (ITP) is a tax that must be paid when purchasing a second-hand property. In many autonomous communities, if you're under 35 and buying your first primary residence, you may benefit from a reduced ITP rate. Instead of the standard 6–10%, you could pay as little as 3–5%.

Here are some notable examples:

• Andalusia: ITP reduced to 3.5% for buyers under 35 who purchase their main residence, provided the actual value does not exceed €130,000.

• Valencian Community: ITP reduced to 3% for buyers under 35 who purchase their first primary residence with a value up to €180,000, subject to certain income requirements.

Tax Reduction or Exemption on Documented Legal Acts (AJD)

The tax on Documented Legal Acts (AJD) applies to notarial, commercial, and administrative documents involved in the purchase of a property. Some regions allow for reductions or even full exemptions from this tax. Here are a few examples by region:

• Galicia: Reduced AJD rate of 1% for buyers under 36 who purchase their main residence, provided that the total assets of the household do not exceed certain limits.

• Catalonia: 100% AJD exemption for the purchase of a primary residence by taxpayers up to 35 years old with annual income below €36,000.

Deductions in the Income Tax Return (IRPF)

In 2013, the national tax relief for home purchases in Spain was eliminated. However, it is still possible to benefit from certain regional tax deductions when purchasing a primary residence.

The process of buying a home involves numerous taxes and legal steps that are important to understand. Having the support of Engel & Völkers will make the process easier and help you take advantage of various aid programs available for buyers under 35.

Specific Aid for Buying Your First Permanent Primary Residence as a Young Buyer

In addition, there are other types of aid available for young people purchasing their first home, such as:

• In rural areas or municipalities at risk of depopulation.

• Preferential access to subsidized housing (VPO) or affordable housing.

• Access to support programs for young people with low or moderate income.

Other reductions

Many local councils offer reductions on the IBI (Property Tax) for young people, single-parent families, or first-time homebuyers. These are some of the discounts you may be eligible for:

• Reduction of IBI during the first 3–5 years.

• Exemption from the municipal capital gains tax on first-home purchase transactions.

• Discount on registration or notary fees associated with the purchase.

Financing for Buying a Home as a Young Buyer

When purchasing a first home, it’s possible that you may not have all the financial resources needed. That’s why there are different financing options designed to make the process easier:

Mortgages for Young People

In addition to standard mortgage loans, there’s a specific type you can request from your bank: the youth mortgage. These products are specially designed for young buyers and offer benefits such as:

• Financing of 90–95% of the appraised value, compared to the typical 80%.

• Longer repayment terms to reduce monthly payments.

• Possibility of a grace period on principal repayment during the first few years.

• Reduced interest rates if you direct deposit your salary or take out associated insurance policies.

• Greater flexibility for mixed incomes or temporary contracts.

What Is the ICO Youth Housing Loan?

The ICO (Instituto de Crédito Oficial – Official Credit Institute) is a public entity that works in partnership with banks to offer loans under special conditions. Although it does not provide loans directly, it channels financing through participating banks.

Since 2023, a specific ICO line has been launched for young people who want to buy their first primary residence, with very attractive terms:

• Up to 100% financing of the property's purchase price.

• Repayment period: up to 30 years.

• Reduced interest rate compared to traditional mortgages.

• Managed through your bank, which must be part of the ICO program.

As you can see, there are financing options that make homeownership more accessible. You just need to meet the requirements and submit your application for evaluation.

And if none of these options suit your needs, you can always count on Engel & Völkers. We work with over a hundred credit institutions to help you find the agreement that best fits your situation. Get in touch with our team and start your journey toward your dream home today.

Requisitos para solicitar ayudas para la compra de vivienda siendo menor de 35 años

Aunque va a depender de la comunidad autónoma en la que te halles, así como de la ayuda que estés solicitando, estos son los requisitos y documentación que es usual necesitar:

Age, Maximum Income, and Other Eligibility Criteria

• Under 35 years of age: This is generally the age limit required to access this type of housing aid. However, some programs allow access up to age 40.

• First primary residence: To qualify for certain aid or exemptions, the property must be your first home, used as your permanent residence, where you must live for at least 5 years and register your address within a specified period.

• Maximum annual income: There is a limit on annual income to apply for aid, designed to benefit those who need it most. This is calculated based on the IPREM (Public Indicator of Multiple Effects Income).

• No outstanding debts: Naturally, you must not have any outstanding debts with the Tax Agency or Social Security, must not have received other similar aid, and must not appear on any credit delinquency lists.

• Property location: Depending on the aid program, the home must be located within certain territorial boundaries.

Required Documents

Although each specific aid program may vary, these are some of the documents that are generally requested:

• Copy of your ID (DNI).

• Purchase agreement (or preliminary contract).

• Certificate of residence (empadronamiento).

• Most recent income tax return.

• Public deed of the property (once signed).

• Proof of income (pay slips, income tax forms, employment history).

Buying a Home as a Young Adult Is Possible If You Know All the Available Aid

As you can see, buying a home as a young person is much easier than it seems thanks to the national and regional aid programs that help facilitate the process. You simply need to find the right home that fits your needs and apply for the corresponding support.

Without a doubt, working with a trusted real estate agency like Engel & Völkers—where we stay up to date on current legislation—will make the process much smoother. We’ll advise and assist you every step of the way to help you secure the aid you qualify for. Contact our team today and start building your future.