Get to know the real estate market in Mallorca
The real estate market in Mallorca has always been a safe haven for investors and foreign buyers looking to buy property in Spain. Mallorca is a dream island with an exceptional quality of life, which will always attract tourists and expats to seek refuge in the Mediterranean. As an island, Mallorca offers an excellent microclimate, nature, safety and an overall laid-back lifestyle. It’s no wonder the real estate market has remained so strong, after all, it’s a paradise destination.
The property market in Mallorca is more stable than the rest of Spain
Last year, property prices in the Balearics went up by 4% in just 12 months. In fact, most regions in Spain showed a strong increase in property prices in 2018. However, the Balearic and Canary Islands, were the leaders in real estate price growth, reaching 10.6% y-o-y to an average of €1,511 per m2. The real estate market growth on the islands was much higher, compared to the 6.7% rise on the Mediterranean Coast, and the 8.7% rise in big cities like Madrid and Barcelona.
Most expensive locations to buy property in Mallorca
Mallorca offers foreign buyers and investors all kinds of properties, in a number of regions. The real estate market in Mallorca offers everything from historic properties in the old town of Palma, to luxury villas in the prestigious municipality of Calvià. In fact, the desirable qualities of these two areas have led Calvià and Palma property prices to reach record levels. However, these are not the only playgrounds for the rich and famous. The most high demand areas in Mallorca include:
Bendinat is a prestigious and sought-after residential area in Calvià, full of luxury villas, hotels, golf courses, international schools and some of the most famous beaches in Mallorca.
Portals Nous is an exclusive neighbourhood in Calvià, including many sea view villas and the glamorous Puerto Portals marina attracting international celebrities and the Spanish royal family.
Puerto de Andratx
Puerto de Andratx is a charming seaside village located on the southwestern tip of the island, an enclave filled with luxurious frontline properties, yachts, and restaurants for Europe’s elite.
Palma old town
The old town of Palma is the centre of the cosmopolitan city of Palma de Mallorca, full of rich history, impressive architecture and historic properties surrounding the famous cathedral.
Santa Catalina is Palma de Mallorca’s trendiest seaside neighbourhood, full of cafés and shops attracting a bohemian crowd and Scandinavian investors looking for traditional townhouses.
Deià is a picturesque village, high up in the Tramuntana mountains, with some of the world’s most exclusive sea view fincas and townhouses, attracting investors such as Sir Richard Branson.
Top real estate buyers include investors from UK, Germany and Sweden
The property market on the Balearic Islands has always been of interest to international buyers, with about one third of the total property demand coming from foreigners. Mallorca, with its stunning beaches, dream properties, easy flight connections, and high quality of life, will simply never go out of fashion. Our main foreign clients interested in the real estate market in Mallorca include English, German and Scandinavian buyers, with a mix of international investors.
Expect to pay between 10-15% on taxes when buying property in Mallorca
One of the most expensive taxes when buying property in Mallorca includes the ITP property transfer tax (impuesto de transmisiones patrimoniales), which is 10% for properties over 600,000€. Since the real estate market in Mallorca is very popular with foreign buyers, there are a number of international lawyers and advisors who can help you when it comes to investing in property on the Balearic Islands, including Balearic Properties who manage the entire process.
Growing demand in the Mallorca real estate market for luxury holiday homes
With foreign tourist numbers up in the Balearics, and last year’s spending reaching 14,826 million euros (a 1.6% increase), it is safe to say that the coming years will bring more holidaymakers and international buyers looking for the perfect home in Mallorca. The most expensive real estate includes frontline properties, especially homes with holiday rental potential. Investors looking to enter the short-term rental market in Mallorca should look for holiday homes with rental licenses.
Studies say the real estate market in Mallorca will grow 6% until 2022
Luxury property prices will rise 6% annually until 2022, according to a study conducted by the Centre for Real Estate Studies (CRES) in Germany. The study also found that the real estate market in Mallorca will see a rise in luxury property prices in 2019. Areas of interest for foreign investors included the southwest of Mallorca around Calvià, the coastal region of Llucmajor, and Palma de Mallorca, with a special focus on luxury holiday homes with swimming pools and views.
“If the market environment remains positive, growth rates can range about 6% per year by 2022.” — Prof. Marco Wölfle
Want to know more about the real estate market in Mallorca? Speak to Balearic Properties!
Balearic Properties can advise you on all things related to property in Mallorca. Whether you’re looking for an investment property, holiday home or primary residence, we’re happy to sit down and talk to you about it. We have over a thousand properties for sale in Mallorca ranging from luxury villas to commercial real estate including hotels. Come speak to our property experts at our offices in Pollensa or Puerto Portals for more information on the real estate market in Mallorca.
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