Price trends in Mallorca It is still difficult to measure property prices by size and location in Mallorca. This does not detract from the rising demand.
It starts with the definition. Not all properties in Mallorca are the same. The industry differentiates between the local residential market and the vacation rental market, which is mostly frequented by foreigners. Just like the demands of their owners, the differences between these two types of property in terms of location, facilities and, of course, prices are often enormous. Nevertheless, on the vacation home market in particular, it is virtually impossible to price a property according to its type, size or features.
A detached house with an unobstructed sea view can be twice as expensive as the identical house next door, whose view is only partially spoiled by a property in front of it. Welcome to Mallorca!
Nevertheless, the price plays a not insignificant role in the purchase decision. For this reason, the real estate agency „Porta Mallorquina“ has commissioned the renowned institute STI Center for Real Estate Studies to carry out a heart and kidney analysis of the vacation property market in Mallorca
Statistics - 2018 STI CENTER OF REAL STUDIES (CRES) / PORTA MALLORQUINA REAL ESTATE
The study looked at around 4,500 properties from the five leading island estate agents. Several filters were also applied when selecting properties for the study. The purely quantitative supply of properties can be easily estimated by aggregating the quantity data from different estate agents. In the multi-agent market in Mallorca, it can happen that the same property is listed with several agents - possibly even with different information.
Average price increase of around 12 percent
As in the previous year, the trend of rising property prices in Mallorca continues. Across all regions, prices have risen by around 12%. While 8 out of 9 regions once again recorded an increase compared to the previous year, half of them even achieved double-digit percentage increases.
While the south-west has traditionally been one of the more sought-after regions, this year the price increases are particularly marked in the Palma region. In both regions, typical property prices are in the region of 6,300 euros per square meter. It is rare to find holiday properties below 4,500 euros per m2 there and prices approaching 8,000 euros per square meter are not far off.Around half of these prices are also being paid in the south and center of the island, with a strong upward trend. Typical prices per square meter here are in the mid 3,000 euro range and also reach over 4,000 euros.
New build vs. existing property
This year, a particular focus was placed on new-build properties. With an 8.5 percent share of the overall market, new-build properties account for almost one in ten vacation properties. At 6,607 euros per square meter, the average price in this segment is around 35 percent higher than comparable existing properties.
Here, too, there are very strong regional differences and an even stronger focus on the top regions, especially the southwest. This is because this region accounts for more than a third of all new-build properties, even more so than among existing properties.The situation is similar in the north and northeast of Mallorca.
As there are fewer and fewer properties suitable for new builds on the market, the demand and therefore also the price for existing properties has climbed accordingly,
says Michaela Unruh from the real estate agency „ImmobilienArta“ in Artà.
„We are pleased that the demand from our international clientele is not focused on specific property types and price segments, but that there is good demand and purchases in all areas“, says Lutz Minkner from „Minkner & Partner in Santa Ponsa. In his company, the range of sales in recent months has been between an apartment for 300,000 euros and a luxury villa for 14 million euros. Minkner puts the average purchase price at 1.2 million euros.
„The main interest was in new builds (both apartments and villas). Almost nothing new was built during the crisis years, so demand for quality properties in mint condition is very high today,
said Minkner.
„Existing properties are stable in price and can be a future-proof investment if purchased well,
believes Wolfgang Pegels from „Pegels & Partner“ in Cala d‘Or.
The demand in the center of the island is increasing
According to the real estate study, around a third of all vacation homes on offer are concentrated in the southwest of Mallorca. This year, however, the regions in the center of the island in particular are recording increases, a sign that lovers of rustic, rural Mallorca have found a market again.
The increasing number of sports tourists such as cyclists and hikers also seems to be driving the growing demand in this region.
Andreas John
