Cristina, facing two charges of tax fraud, has come to a "verbal agreement" to sell the three-storey home in the exclusive Pedralbes area of the Catalan capital which she jointly owns with her husband Iñaki Urdangarin, according to Spanish radio station Cadena Ser.
Cristina and Urdangarin, bought the two-bedroom home in 2004 for €5.8 million ($6.7 million) and spent around €3 million upgrading the property, according to Spanish media reports from 2014.
Before the princess can close out the deal, however, she'll need the permission from the judge overseeing the criminal case against her and Urdangarin.
The 1,000-square-metre (10,700-square-foot) property — replete with a salt-water swimming pool — is currently embargoed as Urdangarin did not stump up the €6.1 million civil bond imposed by the judge as part of a long-running investigation into his business dealings.
Castro is investigating accusations that Urdangarin and his former business partner Diego Torres embezzled €6 million in public funds meant for sports events. The money was allegedly placed in the non-profit Noos Institute, which Urdangarin chaired from 2004 to 2006 and of which Cristina was a board member.
Cristina sat said in court in February 2014 she had no knowledge of her husband's business affairs, but she now faces two charges of tax fraud, both carrying possible jail term of four years.
The public prosecutor has called for Urdangarin to spend nearly 20 years behind bars.
A mother of four with a master's degree from New York University, Cristina was once considered untouchable as a member of the royal family. But the so-called Nóos affair fanned public anger against the monarchy and ruling class during the recent years of economic hardship in Spain.
Urdangarin and Cristina have been excluded from royal activities since 2011.