Research by the Spanish Government has found that the property market in the Balearics is faring better than the market in mainland Spain.
According to the Government’s figures for June 2023, house prices in the Balearics were down 4.5 per cent on June 2023, compared with 4.8 per cent in Malaga.
A study by TINSA, a Spanish valuation consultancy, showed an even greater gap, with its research finding that the Balearics and Canary Islands were down seven per cent while property on the Mediterranean coastline had fallen in value by 8.7 per cent.
Stephen Dight, managing director of Mallorca Sotheby’s International Realty, said: “Mallorca has not suffered as much in the downturn, especially at the top end of the market where there is simply not the same oversupply as you would find on for example the Costa del Sol.
“Official figures are skewed as they only deal with the average property; things are very different in the upper echelons, where price reductions have been far less marked. Sometimes clients approach us with an ill-advised perception that they can pick up bargain property in Mallorca. It’s simply not the case. Once we have a buyer’s specific requirements we can pretty much show them every house that fits that criteria in one day – there just isn’t an abundance of quality property on the market and therefore any need for huge discounting.”
Dight added that the nationality of Mallorca’s buyers also affected the market. While the majority of foreign-owned property on the Costa del Sol is held by Brits, who are still suffering the effects of the recession, many holiday homes in Mallorca are owned by Germans, whose economy is faring far better. For that reason, there isn’t such a desire to free up capital by selling property in Mallorca, and therefore there’s less stock on the market.
The Sotheby’s expert concluded: “Most buyers believe, as do we, that prices in Mallorca have reached the flat line of the ‘U’ and will fall no further. If a suitable property becomes available there is little benefit to be gained from waiting any longer to buy.
“At Mallorca Sotheby’s International Realty we are now genuinely busy, but the market is not on fire to the extent that anything will sell. Only correctly priced, top-quality, not necessarily top-priced, homes are selling, and they must be virtually faultless in terms of their presentation and location [in order to sell].”
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