There is still no reliable price index for properties on the island. Nevertheless, prices per square meter can at least be estimated and defined according to location and features.
There are questions that can hardly be answered, if at all, because the answers depend on countless factors that are difficult to calculate. „How expensive is a property in Mallorca? “ is one such question. The reason: there is no reliable price index for residential real estate on the island, as is often the case in Germany, Austria or Switzerland.
However, price indices for real estate are published time and again in the media and on the internet. Almost all Spanish real estate portals such as „Idealista“, „Pisos“ or „Habitalia.com“ publish information on current property prices for almost all regions of the country at regular intervals. The information from these sources is mostly based on real estate prices from locals or private individuals and therefore also includes cheaper offers. In the vacation home market, the agency „Porta Mallorquina“ has been one of the most important sources for property prices on the island for several years. Since 2015, the company, which is based on the island, has commissioned the German Steinbeis Transfer Institute (STI) Center for Real Estate Study with a detailed study of the Mallorca real estate market. For this year's STI price index, a total of 4,900 properties from various real estate agencies and in all areas of the island were surveyed.
Most popular locationsAs in the previous year, the south-west of the island has the most properties on offer, accounting for around a third. The second-highest concentration of supply is traditionally found in Palma (city center) and the surrounding area. In 2018, the supply in both regions amounted to 20 percent, in 2019 it is similarly high at 17 percent. Compared to 2018, the supply in Palma City fell by six percentage points, while the supply in the surrounding areas of the city rose from 10 to 13 percent.
The south of the island also recorded an increase. The number of properties on offer there increased by almost a fifth between 2018 and 2019, from 9 to 11 percent. The number of properties in the interior (center) fell slightly from 12% in 2018 to currently 10%. However, this slight decline is hardly surprising when you consider that this region recorded an increase in supply of around 70% between 2017 and 2018.
The trend of rising property prices in Mallorca continued in 2019. Between 2017 and 2018, prices rose by 9 percent across all regions, and between 2018 and 2019 they increased by a further 8 percent.
Compared to 2018, prices rose the most in the south (+20 percent) and southwest (+16 percent) of the island and in Palma (+10 percent). All three regions recorded double-digit growth rates. Prices fell slightly in the regions around Palma (-4 percent), the southeast (-3 percent) and the center (-1 percent).
However, the slight decline in Palma's surrounding areas in particular should not be overestimated. Between 2017 and 2018, prices in this region rose by an impressive 36 percent. This is significantly more than in the Southeast region, which recorded the second-highest price increase of 16% in the same period. The low single-digit price consolidations in some regions are more of a correction back to the long-term growth trend than a sign of a real decline in value.
With a price increase of 16% between 2018 and 2019, the southwest is once again living up to its traditional role as one of the most sought-after regions on the island this year. At an average of 7,222 euros per square meter, the highest prices of all regions are achieved there. It is rare to find properties with a price per square meter below 6,000 euros in this region. Properties with a price per square meter of 8,000 euros or more, on the other hand, are the rule rather than the exception.
At over 6,000 euros, prices per square meter in Palma (6,138 euros) and the surrounding area (6,106 euros) are just as high as in the southwest of the island. Cheaper entry-level prices of around 4,000 to 4,500 euros per square meter can be found in the northern half of the island and in the Southeast and Southeast regions. Prospective buyers get the most square meters for their money in the center, where they only have to pay an average of 3,306 euros per square meter.
Andreas John
