The 22-year-old returns to Real after spending two years at Getafe.

"These two years at Getafe have done me a lot of good and I feel I am ready," Granero told Spanish Radio.

"It's a good chance for me to try to carve out a place for myself in the team and I think I can do it."

Granero is Real's fifth close-season signing under chairman Florentino Perez, who spent big to help Los Merengues dethrone arch rivals and Primera Liga champions Barcelona.

Real have already signed Kaka, Cristiano Ronaldo, Karim Benzema and Raul Albiol so far this summer.