What is the current stability of the real estate market?
There is currently a shortage of supply compared to demand on the property market in Mallorca. The reasons for this are, for example, that some owners are taking their properties off the market in order to make more profit speculatively at a later date. However, due to the attractive location of the island and the high demand, the property market in Mallorca is considered to be stable.
How are property prices developing on Mallorca?
Mallorca is considered a very safe haven for property purchases. According to a study by the Center for Real Estate Studies (CRES), there is no danger of the so-called real estate bubble, despite the average annual growth of more than five percent since 2015. Real estate prices have risen in good locations and promise a positive development in the future as well. With regard to inflation, it can be mentioned that it is precisely this that is a decisive reason to think about buying real estate now. The purchase of a property is an investment for life and is characterised by high value stability with potential for value appreciation. With regard to price development, it can be summarised once again that prices and demand are on the rise. Mallorca is considered crisis-proof in the industry, as it is a popular holiday and living destination for many people in Europe and the world. Even the slight downturns due to the Corona pandemic were weathered well after a slight slump in 2020. In 2021, record revenues were already achieved again through property sales on the island.
I would like to use my property as a holiday rental
If you want to rent out your house or flat to holidaymakers, you must already have a permit from the Balearic Government’s Ministry of Tourism (Conselleria de Innovación, Investigación y Turismo). If this has already been obtained, it can continue to be used despite the restrictions imposed by the government. If there is no licence for this property, you must note that the local government has initially frozen the issuing of new licences until 2026.
Why is Mallorca worth investing in?
In addition to the attractive real estate market, Mallorca is easy and quick to reach by plane from all over Europe. In addition, the fantastic nature, fabulous beaches and 300 days of sunshine a year offer all the prerequisites for living on the island for a long time or all year round. As a family, very good international schools are available for your children, while a first-class internet connection allows you to work and live comfortably. In addition, the island scores with a modern healthcare system, good transport connections and countless golf courses and marinas. Furthermore, during the mild spring, autumn and winter months, Mallorca offers countless breathtaking hiking routes and cycling tours. Thus, the island is not only a summer paradise, but truly a year-round paradise.
What factors determine the price of a property?
- Location: On the one hand, the location is a decisive factor in the price assessment. Is it near the sea, does it have a sea view? And in which part of the island is it located?
- Plot: How big is the plot? Do I have direct neighbours?
- Licences: Are there any licences available? Have all the legalities been checked, does the property have a holiday rental licence that is current?
- Pool: How big is the pool, is it legal?
- Building fabric: What does the fabric of the property look like? Is it damp? Have uninvited guests, such as woodworms, found a home? What about the electricity and water supply?
I’m wavering between a new build project or a property conversion, what do you think?
I think that’s how some of my clients feel 😀 For that, you need to know that it has become more difficult to build new houses on the island, but not impossible. What I mean is that you need time and patience. Various applications have to be made, which usually take several months to process. We already have the licences and permits for some of our properties and are practically in the starting blocks. However, if you buy a property without a licence and the approvals are pending, you need time and patience. In addition, the state government has restricted the release of new building projects, which means that it is not possible to build everywhere and in any way. I would be happy to advise you on this in more detail during an initial consultation.
Are you looking for a property with a current licence? This way
When converting or renovating, it depends on what is to be changed. Of course, licences must also be obtained for this. However, most of these are processed more quickly and you can start implementing the project sooner.
In addition, renovation offers a number of advantages in terms of investment. You can buy a property that is getting on in years and sell it again with a larger profit margin. Turn old into new, so to speak 🙂
Are you looking for a renovation project with potential? This way
If you have any further questions, please feel free to contact me at any time. I look forward to hearing from you and together we can realise your dream home in Mallorca.