The arras contract when buying with a mortgage in Málaga

In Málaga, as anywhere in Spain, the first document a non-resident buyer usually signs is not the mortgage deed but a private reservation contract, known as the arras. It commits both sides to the sale, fixes the price and sets a date for completion at the notary, and it normally requires a deposit to be paid on signing.

For a buyer who still needs a Spanish mortgage to complete, the question is simple but important: what happens to that deposit if the bank's answer, once the file is studied, is not the one you hoped for? The answer depends almost entirely on how the arras contract is worded before you sign it.

Málaga province, part of the Costa del Sol, features a mix of coastal resorts, the city of Málaga, and mountainous inland areas. It draws an international buyer base including retirees, remote workers, and holiday-home seekers attracted by the coastal lifestyle and established foreign communities in towns like Marbella and Estepona.

Málaga Airport offers frequent international flights, supporting easy access throughout the year. Property options include beachfront apartments, golf-course villas, and traditional pueblos further inland, with the coast experiencing higher visitor numbers during summer months.

The figures below describe Málaga (province) as it stands now — residents, advertised home prices, access routes and climate — each dated and sourced. Use them to form a realistic view of Málaga (province) while you work out what you can afford.

The province of Málaga as a whole, not merely its capital city, had 1,791,183 registered residents on 1 January 2025, according to the INE annual census. This figure covers every municipality within the province, from its largest towns to its smallest villages. In the province of Málaga, 341,229 residents hold a foreign nationality, about 19 of every 100 people registered there. That is a significant but not dominant share, and it varies considerably from one town to another within the province.

INE's register shows 49,298 British nationals living in the province of Málaga as of 1 January 2025, making it one of the province's largest foreign communities. That points to a community that is firmly rooted across the province. In 2021, 53,405 were registered, more than the current figure. The decline often reflects people leaving the area or dropping off the padrón rather than any sudden exodus. Here are the largest foreign communities registered in Málaga (province) on 1 January 2025, drawn from the nationality figures INE publishes for each municipality.

Beyond the main nationalities listed above, the INE also registers smaller groups, Germans, Italians, Dutch, Belgians or Scandinavians among them, across Málaga province. This breakdown reflects 1 January 2022, the last edition counting every nationality individually, a different year from the table above.

In our own price bank, the 7,699 homes currently advertised for sale across the province of Málaga show a median asking price of €3,700/m² and a median ticket of €392,000. That is above the €3,135/m² median recorded across the 130 towns we track across Spain. Prices vary considerably from one listing to the next, though the bulk of the market, its middle half, falls between €2,720 and €4,940 per square metre.

Taking €392,000 as the median asking price in Málaga (province), the resale transfer tax of 7 % amounts to about €27,400, with a further €4,700 for notary, registry and gestoría fees. That puts the total near €32,100, which a lender does not finance and must come from savings. The figures reflect asking prices in listings live on 2026-11-01, rather than prices actually paid. Final amounts are agreed through negotiation and vary with the state, location and orientation of each property.

Below is a comparison of the towns we follow in Málaga, covering inhabitants, foreign residents per 100 inhabitants and median asking prices per square metre across the province.

According to INE's experimental estimate from holiday-rental platform listings, Málaga (province) had 45,176 tourist dwellings in 05/2026, offering 213,006 bed places and close to 25 per 1,000 residents. The presence is moderate overall, but a regional licence remains necessary for tourist letting.

Before booking, confirm that Aeropuerto de Málaga-Costa del Sol (AGP), the one commercial airport serving Málaga (province), has a connection from your home airport at the time of year you intend to fly, as this changes seasonally. These weather readings come from Málaga, the capital of the province, so inland areas, higher ground or other islands within the same province can show noticeably different conditions. Winters here are mild: the January mean is 12.1 °C, with an average daily minimum of 7.4 °C, while August averages 26.0 °C with a daily maximum around 30.8 °C. Outdoor life stays comfortable through most of the colder months. The area gets a moderate amount of rain, around 534 mm annually over about 42 days. On average, 2,905 hours of sunshine are recorded each year. These figures are the official climate normals (1981-2010) from AEMET, Spain's state weather agency, at its Málaga Aeropuerto station, about 12 km away; conditions at the exact property can differ slightly, especially inland or at altitude.

In the twelve months to 07/2026, 35,050 homes changed hands in the province of Málaga, INE figures show. Such activity tends to bring more reference prices and a larger selection for anyone searching. The figures above cover the whole province of Málaga, but they vary widely from town to town and from property to property. Share what you are searching for and we can review the details with you.

The transfer tax on a resale home is set by each Spanish region. In Málaga the general rate is 7 %, and on top of it come notary, land registry and gestoría (roughly one more percent). On a new build you pay 10 % VAT plus stamp duty instead of the transfer tax. This money is not lent by the bank.

The arras is a private contract between buyer and seller, agreed before the notary and before the bank hands over any funds. It usually names the agreed price, the completion date, and the deposit paid as a down payment on account of that price. Spanish law recognises more than one kind of arras: penitenciales, which allow either party to withdraw under agreed penalties, and confirmatorias, which bind both sides more tightly and leave less room to walk away. The wording matters as much as the amount.

For a buyer who is financing the purchase with a Spanish mortgage, the arras should never be treated as a formality. Once it is signed, the deposit is at stake, and the seller will expect you to complete within the agreed weeks, whether or not your mortgage has been approved by then.

The safest structure for a non-resident buyer is an arras contract that includes a suspensive condition: the sale, and the loss of the deposit, apply only if the buyer fails to complete for reasons other than a lender's decision on the loan. In practice this means the contract states plainly that completion is subject to the buyer obtaining mortgage approval within a stated period, and that if no Spanish bank approves the loan on reasonable terms within that period, the buyer can withdraw and recover the deposit.

Without that clause, a buyer who signs the arras before any bank has reviewed the file is taking on the seller's risk as well as their own. If the loan does not come through in time, the seller can usually keep the deposit under a standard penitential arras, even though the buyer did nothing wrong beyond trusting that financing would arrive. This is why we recommend starting the mortgage study in Málaga before, or at the very latest alongside, the negotiation of the arras text.

Once the mortgage is approved and the arras deposit is applied to the price at the notary, the obligations do not end. As a non-resident owner you will file an annual Modelo 210 tax return in Spain, and because Spain and the United Kingdom have a double taxation agreement, a tax adviser can confirm how any Spanish rental income or future gain should also be reported to HMRC. If you ever sell, the buyer will withhold 3% of the price against your Spanish tax bill.

Because you are paying in euros from a sterling income, it is also worth tracking the exchange rate between signing the arras and completing at the notary; a shift in GBP/EUR between those dates can change what the deposit and the final payment actually cost you.

Spain is a relatively short flight away from most UK airports, making regular visits to a Spanish property straightforward for owners based in Britain. Many British buyers are drawn to Spain for its climate, coastal lifestyle and established expatriate communities. One practical point to bear in mind is that Spanish inheritance law differs from UK rules, so it is worth taking specific advice on how it may affect the property and one's estate. Currency movements between sterling and the euro can also affect the overall cost of purchase and ongoing expenses.

Spain and the United Kingdom have a double taxation agreement in place, and a local tax adviser should confirm how rental income or gains from Spanish property must be declared and reported to HMRC.

As the United Kingdom is no longer an EU member state, British citizens may stay in Spain for up to 90 days in any 180-day period without a visa, and must apply for a visa or residence permit for longer stays.

Since the United Kingdom uses the pound sterling (GBP) rather than the euro, buyers should factor in exchange-rate movements and currency conversion costs when paying for a property or transferring funds to Spain.