Reservation Agreement Property Spain: Arras, Option Contract & Everything About the Pre-Contract in Mallorca

Anyone looking to buy a property on Mallorca will be familiar with the dilemma: the dream property has been found, but weeks pass before the notary appointment — and desirable properties change hands quickly. The reservierungsvertrag Immobilie Spanien fills precisely this gap. It temporarily takes the property off the market and gives you, as the buyer, time for due diligence checks, sorting out financing, and gathering all the necessary documents. This guide explains the types of contract available (Contrato de Reserva, Contrato de Arras, Optionsvertrag), what the typical deposits are, what deadlines and withdrawal consequences you need to be aware of — and the mistakes most commonly made by German buyers. All information reflects the current position as of 2026.

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Why you need a preliminary contract before the notary appointment

On Mallorca — and throughout Spain — a property can in principle be sold on a handshake. Spanish civil law (Artículos 1445 ff. Código Civil) governs the purchase contract (compraventa) without any mandatory formal requirements. However, notarial certification is essential as soon as you, as the buyer, wish to be entered in the land registry (Registro de la Propiedad) — and this registration is the only reliable protection against the still-registered former owner disposing of the property or unknown third-party encumbrances.

In practice, several weeks to months typically pass between the decision to purchase and the notary appointment. During this time:

1. all ownership documents and land registry extracts must be reviewed,
2. any encumbrances, debts, or planning permission issues must be resolved,
3. financing must be secured,
4. the energy performance certificate and other required documents must be in place.

A binding preliminary contract records the purchase intention of both parties and protects you from the seller selling the property to someone else in the meantime. For precisely this purpose, Spain offers three different instruments — and the one you choose is crucial.

An overview of the three contract types

In practice on Mallorca, you will encounter three preliminary contract models, which differ considerably in terms of function, binding effect, and financial consequences.

Note: In practice, the terms are often used loosely in Mallorca. Always read the precise wording of the contract — not just the heading.

The Reservation Contract (Contrato de Reserva) in Detail

The reservation contract (acuerdo de reserva or contrato de reserva) is the first and generally least binding step. It is entered into when there is a concrete interest in purchasing, but no final decision has yet been made.

What it covers:

• How many days the property is reserved for
• The amount of the reservation fee
• Whether and how the fee is credited towards the later purchase price

Typical reservation fees:

If the prospective buyer ultimately decides not to proceed, the reservation fee is generally forfeited. If you do go ahead with the purchase, the fee is credited against the purchase price. The reservation contract is frequently a private written agreement and is often prepared directly by the estate agent — a solicitor should nevertheless review it.

Caution: The reservation contract is not an arras contract. Without an explicit penalty clause (cláusula penal), the seller may in certain circumstances still sell the property to another buyer — in which case you would simply receive the fee back.

The Arras Contract (Contrato de Arras) – the Classic Instrument in Mallorca

The Contrato de Arras is the most commonly used instrument in property purchases in Spain and offers both parties significantly stronger protection than a simple reservation contract. Spanish civil law recognises various forms of arras; in practice, the so-called Arras Penitenciarias.

Arras Penitenciarias – how the penalty works

The arras penitenciarias are a private contract that bindingly secures the purchase intention of both parties and provides a clear sanction in the event of withdrawal:

• If the buyer withdraws: The deposit paid is forfeited — they will not see that money again.
• If the seller withdraws: They must refund double the deposit amount to the buyer.

Deposits of around 10 % of the negotiated purchase price are standard. The amount paid is later offset against the purchase price, provided the sale goes ahead.

What must be included in the Arras contract

A well-drafted Arras contract must contain at least:

1. Full identification of both contracting parties (incl. NIE number)
2. Precise description of the property (cadastral reference, land registry number)
3. Agreed purchase price
4. Amount of the Arras payment
5. Payment terms and account number / escrow account
6. Deadline for notarial completion
7. Penalty clause (cláusula penal) in the event of withdrawal
8. Conditions under which withdrawal is possible without loss (e.g. in the event of financing falling through)

Note: In many cases, the deposit under the Arras contract is transferred to an escrow account held by a solicitor, tax adviser or notary — not directly to the seller. This is strongly recommended.

The option contract (Contrato de Opción de Compra)

The option contract goes a step further than the Arras contract and is particularly common for sought-after luxury properties or high-demand new-build projects in Mallorca. From the buyer's perspective, it is the most powerful instrument available.

What distinguishes it from the Arras contract:

In the option contract, the seller guarantees that the property has certain characteristics and meets defined conditions — such as planning permission, size, and technical soundness. The buyer receives the unilateral right to complete the purchase within the agreed option period. The seller is bound during this time and cannot sell to a third party.

The option premium is credited against the purchase price upon exercise of the right to purchase. If the buyer does not exercise the option, the premium is forfeited – the seller retains it.

Please note: The option contract is more advantageous for the buyer, as they can even insist on completion of the purchase agreement in the event of a dispute.

Step by step: From reservation to escritura

Here is how the process from the initial reservation through to the notarial transfer of ownership in Mallorca typically unfolds:

1. Property found, price negotiated – verbal agreement reached with the seller or agent
2. Sign the reservation contract – take the property off the market and pay a small fee
3. Due diligence – review the land registry extract (nota simple), clarify any encumbrances, check the land registry, and request an energy certificate if required
4. Apply for your NIE – no purchase is possible without a Spanish tax identification number (NIE)
5. Enter into an arras contract or option contract – pay a deposit (typically ~10%) and set deadlines
6. Arrange financing – Apply for a mortgage in Mallorca if required
7. Calculate purchasing costs – Mallorca purchasing costs – keep these in mind
8. Prepare for the notary appointment – ensure all documents are complete and select a notary (Notar Spanien)
9. Sign the escritura – notarially certified purchase contract before the notary
10. Land registry entry – only at this point are you the legally registered owner

Legal Foundations: What Spanish Law Says

Property transactions on Mallorca are governed by the general provisions of the Spanish Civil Code, in particular Articles 1445 et seq. (compraventa). For arras agreements, Articles 1454–1455 of the Código Civil are additionally applicable, which expressly regulate the arras penitenciarias.

Important for foreign buyers:

• No requirement for written form: A purchase contract in Spain can be concluded without any particular formality — even verbally. In practice, however, a written agreement is always recommended.
• Land Registry entry only after notarial appointment: Without an Escritura Pública (notarially certified purchase contract), there can be no entry in the Land Registry (Registro de la Propiedad).
• No full protection without Land Registry entry: A buyer who has not been registered is completely exposed to the risk of the still-registered previous owner disposing of the property to a third party.
• Public law aspects: For some properties, additional public law regulations may need to be observed — for example, regarding planning permission, changes of use, or existing encumbrances.

Tax Aspects of the Preliminary Contract

The conclusion of a reservation or arras contract does not generally trigger a tax liability — the tax burden only arises upon conclusion of the final purchase contract. Nevertheless, there are a few points to bear in mind:

Note: For a complete overview of all taxes incurred on purchase, we recommend our guide to purchase ancillary costs on Mallorca.

Most Common Mistakes with Reservation and Arras Contracts

German buyers on Mallorca repeatedly make the same mistakes — here are the most common ones:

1. Not understanding the type of contract

The difference between a simple reservation agreement and an Arras contract with a penalty clause is significant. Anyone who signs a 'reservation agreement' that is de facto an Arras contract may lose a considerable portion of the purchase price if they withdraw.

2. Transferring funds directly to the seller

The deposit should – at least for larger amounts – be paid into an escrow account held by an independent solicitor or notary, and not transferred directly to the seller or estate agent.

3. No withdrawal clause for financing failure

If the bank refuses the mortgage, you will not get your deposit back – unless a corresponding conditional clause (condición suspensiva) has been explicitly agreed.

4. Not checking the land registry in advance

Anyone who signs the Arras contract without having obtained a land registry extract risks reserving a property encumbered with mortgages or other charges.

5. Setting deadlines that are too short

Particularly with properties that have complicated documentation or where a mortgage application is still in progress, excessively short option periods can result in you running out of time and losing your deposit.

6. Not engaging an independent solicitor

The agent's solicitor represents the interests of the seller or the agent. Instruct your own independent abogado to review the contract before you sign.

7. Blindly trusting an English or German translation

The legally binding text is the Spanish version. Any discrepancies between the translation and the original are at your expense.

What comes after the preliminary contract?

The Arras contract or option agreement paves the way to the notary appointment – but the journey is not yet complete. The following tasks need to be addressed in the remaining time:

• Full due diligence: Cadastral extract, land registry, planning status, outstanding debts (IBI arrears, communal debts in the case of leasehold/strata properties)
• Energy certificate: Mandatory document for the sale – check whether it is in place (Energiezertifikat Spanien)
• Financing: Obtain and secure a mortgage offer (Hypothek Mallorca)
• Securing your NIE: If you do not yet have one, apply immediately
• Choice of notary: As a general rule, the buyer has the right to choose the notary
• Preparing the escritura: Send all documents to the notary in full

Following the notary appointment, the property is entered in the land registry – only then are you the full legal owner with protection against third-party claims.

Checklist: Before signing the preliminary contract

Print this list and tick off every point before you put pen to paper:

• Land registry extract (nota simple) is available and has been reviewed by a solicitor
• Catastral extract available, area and designated use match
• Contract type clear: reservation agreement, Arras or option contract?
• Penalty clause (cláusula penal) read and understood
• Withdrawal clause in the event of financing falling through included?
• Deposit goes into an escrow account, not directly to the seller
• Deadline to notary appointment is realistic (min. 4–8 weeks for standard cases)
• Spanish NIE number in place
• Independent solicitor of your own has reviewed the contract
• Purchase ancillary costs calculated and liquid funds available
• Energy certificate available or procurement clarified
• For new builds: developer's creditworthiness and bank guarantee for deposit reviewed

Special considerations for new builds and off-plan purchases

When purchasing a property that has not yet been completed (sobre plano / off-plan), special rules apply:

• Developers typically require around 6.000 € as the first deposit upon signing the reservation agreement, and sometimes around 3.000 €.
• Further payments follow in construction instalments – and these must be secured by a bank guarantee from the developer without exception. Without this guarantee, there is a risk of total loss should the developer become insolvent.
• Even with new builds, the same rule applies: engage your own solicitor and read the contractual clauses on the completion deadline and any potential delays carefully.

Please note: With off-plan purchases in Mallorca, the bank guarantee is not optional — it is an absolute must. Insist on it in writing.

Summary: Which contract should you choose?

The simple reservation agreement is suitable if you want to secure a property quickly and buy yourself a few days — without significant financial exposure. The fee is modest and the commitment manageable.

The Arras contract (arras penitenciarias) is the standard for a serious property purchase in Mallorca: both parties are binding committed, the deposit (~10 %) is a genuine signal of intent — and in return gives you the right to receive double the amount back should the seller withdraw.

The option contract offers you as the buyer the strongest position: you can compel the purchase, and the seller can no longer pull out. This is particularly useful for luxury properties, highly sought-after new-build projects, or where the due diligence process is especially complex.

Always have the contract reviewed by an independent solicitor (abogado) before you sign. The few hundred euros in legal fees are the best insurance against a five- or six-figure loss.

→ You can find the complete buying process – from the first viewing to the land registry entry – in our guide to the Legal Process of Buying Property.

Official Sources

• Spanish Civil Code (Código Civil), Art. 1445 et seq. and Art. 1454–1455 (compraventa and arras): https://www.boe.es/buscar/act.php?id=BOE-A-1889-4763
• Registro de la Propiedad (Spanish Land Registry): https://www.registradores.org
• Agencia Tributaria Baleares (ATIB) – Taxes on property purchases: https://www.atib.es
• Agencia Estatal de Administración Tributaria (AEAT): https://www.aeat.es
• Consell de Mallorca – Urbanisme i Habitatge: https://www.conselldemallorca.net
• Statistics portal of the Spanish notaries (transaction data Balearic Islands): https://www.notariado.org/liferay/web/cien/sala-de-prensa/noticias