The Belgian is expected to complete a move to the Bernabeu this summer but the two clubs are some way apart in their valuation.
According to Sky Sports, Chelsea have conceded defeat and are ready to sell for £130m.
But the Spanish giants are not currently willing to pay more than £88m, meaning the two clubs still stand a whopping £42m apart in their valuations.
Chelsea chief Marina Granovskaia is locked in negotiations for the star, whose contract at Stamford Bridge expires next summer.
The Blues have been unable to tempt Hazard into signing fresh terms.
And they’re looking to sell him during this window in order to avoid losing him for free.
Hazard has hit heart set on a switch to Real as he wants to work with childhood idol Zinedine Zidane.