Good Faith in the Land Register

Grundbuch Mallorca Immobilien
The Spanish property register has approximately the same functions as the land register in Germany, and therefore also has relevance in the transfer of ownership of Mallorcan properties. However, the Spanish land register is not divided into sections in which the respective rights (property rights, mortgages and other charges) are registered. Rather, in the Spanish property register, all entries are entered consecutively according to their chronological order.

If you want to find out who owns a property (house, apartment, villa, finca) and whether it has mortgages, easements or other encumbrances, you should obtain a land register extract (nota simple informativa) from a lawyer or the real estate agent and have these matters carefully checked. The question of who is registered as the owner in the land register can be of great importance for the effectiveness of a property acquisition, since the parties do not submit every change of ownership to the land registry for registration. Anyone who buys in good faith from an owner registered in the land register is protected by the “Good faith in the land register”.

There is a difference between the actual owner and the owner registered in the land register more often in Spain, than in Germany, due to the peculiarity of Spanish law that a change of ownership does not require the notarial deed. If the seller and buyer agree to sell a certain property at a certain purchase price, pay the purchase price and hand over the property, an effective purchase contract is concluded and ownership is transferred from the seller to the buyer.

In the Land Register, however, the transfer of ownership can only be entered on the basis of a notarial deed. Changes of ownership without a notarial deed are usually made in order to save the otherwise land transfer taxes which are due, plusvalia and other costs (notary, land register, Gestoria). Between family members and/or with trusted confidantes, there are often agreements.

Attention, protect yourself from loss of property!

The missing entry in the land register is extremely risky for the owner who is not registered: namely, the old owner (still) registered in the land register sells the property again – this time through a notarial contract of sale, the new purchaser is protected because the “protection of good faith” applies to him “In the correctness of the entries in the land register.

The unregistered first buyer loses his property; the new purchaser is registered as the owner in the land register. What is entered in the property register leads to the presumption of the legality of the property register reality and thus protects the good faith buyer. The protection of good faith not only relates to the owner position of the registered owner, but also to all rights and encumbrances that are entered in the land register or not (exemption from encumbrances), but not to properties such as size and location of a property.

Expert Tip: Therefore, the expert’s advice: Before every contract completion for a property on Mallorca, have a lawyer check the entries in the property register.