The Balearic Islands, conquered in the 13th century by James I, privileged for their location in the Mediterranean Sea, their climate and their proximity to the coasts of the Iberian Peninsula, have always been the object of interest of Romans and Byzantine vandals. In the 21st century they surely continue to attract different cultures, especially Mallorca, an island much loved by the Germans, the English, among others. The director of the study, Professor Marco Wölfle, from the Center for Real Estate Studies (CRES):
“In the last year, Mallorca has not only maintained its position as one of Europe’s most sought-after holiday destinations and real estate locations, but has expanded it even further. The positive correlation between tourism intensity and real estate demand remains intact. This fact, together with the attractive macro-location of Mallorca – with the beauty of the island, its mild climate and its high quality of life – makes the Balearic island a stable and lucrative real estate market.”
Prices are highest in the southwest and rise fastest in the center of the island
As in previous years, price levels in the regions remain very different. Due to the size of the island, potential buyers with a wide range of ideas can find suitable properties of stable value to fulfill a lifelong dream or as an investment. The southwest remains the most expensive area, with 7,700 euros per square meter. However, the city of Palma is increasingly catching up with 7,300 euros per square meter. The most affordable area continues to be the center of the island, with an average of 4,165 euros per square meter. However, prices are currently rising especially sharply there. Within a year, buyers will have to pay an average of 13.5% more for properties in the region, with its lush nature and Mallorcan lifestyle away from the tourist bustle. Luxury continues to drive prices and exceeds 10,000 euros per square meter. While supply in the luxury segment decreases, prices continue to rise. And double digits. Last year, the average price across the island for a luxury property in Mallorca surpassed the barrier of 10,000 euros per square meter for the first time. Compared to the previous year, the price rose from 9,650 euros to 10,900 euros. In the southwest, known and popular for its luxury properties, prices in this segment rose by 4 percent to 13,400 euros per square meter. As with mid-prices, other regions are also catching up in the luxury segment. In the surroundings of Palma, an average of 9,850 euros per square meter is being paid for luxury properties, 10.5% more than the previous year.
Not all that glitters is gold
Everything seems very positive, as long as, according to us, the essence of the island and its inhabitants is maintained and that the investment of foreign capital also allows locals to access real estate without “forcing” them to sell only to investors, allowing a local retail customer market, also very important for the territory. That is why the Parliament of the Balearic Islands has approved Law 3/2024, of May 3, on urgent measures in housing, which establishes the creation of limited-price housing to help increase the supply of houses at affordable prices. , given the increase in the cost of real estate in this autonomous community.
We will talk about these measures in the next June Blog.
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