How much is usually paid as a deposit (“arras”) or down payment when buying a flat?

Question

José Manuel Alburquerque · Accepted Answer

The law sets neither a minimum nor a maximum, so the amount is whatever the buyer and seller agree. In practice, it is usually between 5 % and 10 % of the price. The most common figure is 10 %. Normally the deposit is deducted from the price on the day the public deed is signed. Before setting the amount, bear in mind that, if it is a withdrawal deposit (“arras penitenciales”), the higher it is, the more it will cost either party to back out. An example For a flat costing 250.000 euros, the deposit would be 12.500 euros at 5 % and 25.000 euros at 10 %. If it is a withdrawal deposit, the type that allows the parties to withdraw, the following happens: A buyer who backs out loses what they paid, 12.500 or 25.000 euros. A seller who backs out must pay back double, 25.000 or 50.000 euros, that is, what they received plus the same amount again. If it is a confirmatory deposit, which in Catalonia is what applies if the contract says nothing else, neither party can back out by paying an amount. A party who fails to perform may be compelled to buy or to sell, or to pay for the losses they cause. What to bear in mind when setting it With a withdrawal deposit, a low down payment makes it easier for the seller to walk away for a better offer by paying double. A high one makes backing out more expensive for both parties. If you need a mortgage, bear in mind that banks usually lend at most 80 % of the valuation or of the price, if lower. The deposit will come out of your savings, as will the rest of the price not financed by the bank, the taxes and the costs of the purchase. Pay by bank transfer and ask for a receipt stating who is receiving the money and what it is for. The reservation (holding deposit) that many estate agents ask for before the deposit agreement is something different. It is usually a smaller sum, of a few thousand euros.