In Palma the market has been booming for the past five years and reached an all time high in 2007 with prices per square metre in good locations in Palma old town or on a seafront position approaching that of prime property in Madrid. This year prices have adjusted to the new market conditions. For example; a typical villa with views can now be picked up for around €1.4 million. Well located apartments with views have withstood the current market conditions better than other types of property with small reductions off the original asking price and currently you would expect to pay 500,000 for a good apartment.
This spring has seen more positive market movement and inevitably there are some “bargain hunters” about looking for distressed sales which are not so prevalent and certainly not on the scale that might have been anticipated. For the moment prices are not dropping anymore and the market has found its level and stabilised and most property is now taking a year to sell as opposed to 7-9 months at the market peak in 2007.
According to Terence Panton, Managing Partner of E&V Palma; “Since January real estate activity has gradually evolved more positively with some sales to Swiss, German, Russian and Scandinavian clients. The main vendors tend to be local or foreigners that need to sell, British vendors can be very competitive at present when converting euros back into pounds sterling”.