The growth of Mallorca's real estate market continues in 2024
What will house prices be in Mallorca in 2024?
Mallorca has emerged as a prominent player in Spain’s ever-changing real estate market. The year 2023 has proven to be a pivotal moment, as Mallorca not only solidifies its status as a sought-after destination but also experiences remarkable growth in its real estate sector, particularly in the luxury property segment.
The current landscape of Mallorca’s real estate market showcases a surge in prices. According to Savills associates and one of the Spain’s leading property agents in Mallorca Balearic Properties the market has witnessed a significant increase in property values. In December 2023, Mallorca city recorded a staggering 22.3% rise in prices, reaching a price per square meter of 3,900 euros. These figures, sourced from the esteemed real estate portal Pisos.com, clearly illustrate the growing demand for properties on the island.
Take a look at the developments in the Spanish property market and the residential property purchase and sale transactions, by month
While Mallorca shines as a real estate hotspot, other cities in Spain showcase diverse trends.
DatosRTVE Fuente: Instituto Nacional de Estadística (INE)
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Property market in Mallorca thriving due to increase in cyclists
The real estate market in Mallorca is thriving, attracting more than 200,000 cyclists annually who are interested in either renting or purchasing properties in Spain.
The island is experiencing an increasing demand for buyers and renters who are avid cyclists. Popular areas such as Puerto Pollensa, Deia, and Soller are often chosen as home bases. However, those who desire year-round amenities and accessibility tend to gravitate towards Port d’Andratx, Son Vida, and Bendinat.
In 2023, the Balearic Islands saw sales surpassing 15,000, marking the highest recorded volume since 2007. The implementation of a holiday rental license in 2018 has resulted in an increase in property sales for those with an existing license. This is expected to happen again in 2024
Also, the recent electoral win of the Partido Popular in May suggests that the implementation of a restriction on overseas buyers buying second homes in the Balearic Islands is now improbable.
Mallorca Property Market Sees Return of Buyers
After the Covid pandemic, buyers have returned in significant numbers, and cycling has become a lucrative industry.
According to the tourism ministry, approximately 200,000 cyclists traveled to Mallorca in 2019. This figure is believed to have risen following the outbreak of the pandemic.
The top priorities for any dedicated Strava user include the Formentor lighthouse, positioned at an elevation of 188 meters on the northeast corner of the island, and the winding roads of Sa Calobra.
For more than ten years, Alcudia and Pollensa have served as the main locations for Team GB and the now-renamed Ineos Grenadiers (formerly Team Sky). Additionally, Puerto Pollensa, Deia, and Soller, located within the Serra de Tramuntana, a UNESCO heritage site, are popular choices for cycling training camps.
The southern-western part of the island, close to Port d’Andratx, is just as picturesque but with less mountainous terrain, making it a popular destination for cycling enthusiasts.
According to Knight Frank’s Head of International Sales, Mark Harvey, Port d’Andratx, Son Vida, and Bendinat may not have mountains like the northern areas, but they provide convenient access to Palma, the Airport, and a variety of year-round amenities for northern Europeans seeking respite from their harsh winters.
Premium added for properties for sale with rental license
Starting from 2018, individuals who want to rent out their property must obtain a vacation rental license referred to as an ETV (Estancia Turisticas en Viviendas). Consequently, houses that already possess a rental license have the advantage of being sold at a higher price.
In May, the Partido Popular (People’s Party or PP) achieved a triumph in the Balearics Islands. This victory has resulted in the abandonment of a proposed limit on the number of second homes owned by foreigners.
As a solution, the PP intends to address the problem of illegal extensions on the island, which has greatly affected the reputation of the white isle. This action will provide reassurance to both local and international buyers and also improve the transparency of the market.
Property prices increased
Iris Grünewald, Managing Director at Balearic Properties, states that Mallorca has made a remarkable recovery from the effects of Covid-19. Its popularity lies in its wide-ranging appeal, attracting a diverse range of buyers from various nationalities including British, German, Scandinavian, French, and now even American buyers.
