Where clients get caught out
Agents often ask for a reservation deposit within days. Paying it before checking the land registry, the licences and the community debts can tie you to a property with problems, or cost you the deposit if you walk away.
The steps of a property purchase in Mallorca
| Step | What happens | Our role |
|---|---|---|
| 1. NIE and bank account | Foreign buyers need an NIE and usually a Spanish account | We obtain both, also remotely |
| 2. Reservation | Short agreement with a small deposit | We review it before you pay |
| 3. Due diligence | Registry, cadastre, licences, debts, community, tenants | Full written report |
| 4. Arras contract | Private contract with a deposit, usually 10% | We negotiate and draft it |
| 5. Completion | Deed signed before a notary, balance paid | We attend with you or for you |
| 6. Taxes and registry | Transfer tax or VAT, then registration | We file and register |
The arras contract and your deposit
Most purchases in Mallorca use penitential arras: if the buyer withdraws, they lose the deposit; if the seller withdraws, they must return it doubled. The wording decides whether the deposit can be recovered if a condition fails, for example if the mortgage is refused. We negotiate those conditions for you. See the guide to the arras contract in Spain.
Taxes and costs of buying
A resale home pays the Balearic transfer tax on a progressive scale starting at 8%; a new build pays 10% VAT plus stamp duty. Add notary, land registry and legal fees. We give you a complete budget before you sign. See purchase taxes in the Balearic Islands.
Buying from a non-resident seller
When the seller does not live in Spain, the buyer must withhold 3% of the price and pay it to the tax agency within a month. If not, the property can answer for the seller's tax. We handle the withholding at completion.
Buying without travelling
With a power of attorney signed in your country, we can open the bank account, sign the contracts and complete the purchase while you stay at home.
Example: buying property in Mallorca
Based on situations we commonly see; not a specific client. A German couple found an apartment in Palma and were asked for a 20,000-euro reservation the same week. We checked the registry first: the seller's mortgage was larger than expected and the community had unpaid works. The contract was rewritten so both were cleared at completion.
Our collaborators for buying property in Mallorca
For every service we work with trusted collaborators when a matter needs them: notaries, architects and surveyors, tax advisers at Castell.tax, sworn translators, banks and mortgage brokers, property managers and specialist lawyers in other parts of Spain. You keep one lawyer as your single point of contact, and we coordinate everyone else.
Castell.law is the English and German-speaking practice of Castell Abogados, a law firm in Palma de Mallorca. This page is general information, not advice on a specific case: laws and procedures change, so check your situation with us before acting.
Not sure where you stand? Ask before you sign
Tell us about your matter or send us the documents you have. A lawyer will explain the risks, the options and the cost before you commit to anything.
Questions about buying property in Mallorca
How long does a property purchase in Mallorca take?
Usually six to ten weeks from reservation to completion, longer for new builds or fincas.
What deposit is usual in Mallorca?
A small reservation deposit and then around 10% of the price with the arras contract.
Who chooses the notary?
The buyer normally chooses the notary, as the buyer pays most notary costs.
Can I get a mortgage as a foreigner?
Yes, Spanish banks lend to non-residents, usually up to 60–70% of the value.