Residential properties in premium locations on the Mediterranean island of Ibiza witnessed further price rises in 2016. “Demand for high-end residences on Ibiza remains significantly higher than the supply available. In addition we registered a rise in average property prices in 2016,” said Florian Fischer, Managing Partner of Engel & Völkers on Ibiza. These and other developments have been detailed by Engel & Völkers in its current “Ibiza Market Report”.
Buyers from 17 different countries
Ibiza benefits from strong international demand. In the past year, the two Engel & Völkers residential property shops on Ibiza brokered properties to buyers from 17 different nations. For the first time in almost a decade, Spanish clients were the second largest buyer group here. As in 2015, the majority of buyers came from Germany. Other buyers were from the UK, France, Switzerland, Italy and the Benelux countries.
Luxury tourism industry still flourishing
Ibiza is also seeing a continuing boom in luxury tourism. Private air traffic increased again last year, and Ibiza continues to lead the way as the Balearic island handling the most private flights. Moreover, Ibiza has evolved into one of the most desirable yachting ports in the Mediterranean. The former ferry terminal has been extended once again, meaning that in future there will be even larger moorings for superyachts, including a 185-metre long berth.
Entry prices in prime locations on the rise
One of the highly desirable regions for residential property on the Balearic island is Ibiza Town and its surrounding region. Redevelopment of the centre will be completed this year, enhancing the exclusivity of the area along with the completion of new luxury hotels. Residential property prices in Ibiza Town and the surrounding area already rose sharply in 2016. Entry prices for villas with an interior of around 350 square metres in very good locations have increased to 4 million euros (2015: 3.5 million euros). Asking prices for traditional fincas of a comparable location and size started at 3 million euros, also marking a rise over the previous year (2015: 2.5 million euros).
Some of the most exclusive residential areas can be found in the south and southwest of the island. Properties vary here from contemporary designer villas through to traditional old fincas. The region is known around the world for its upmarket beach clubs and its variety of watersports activities. Prices for villas spanning around 350 square metres in very good locations started at 3.5 million euros in 2016, thereby exceeding entry prices from the previous year (2015: 3 million euros). Fincas of approx. 350 square metres in size in very good locations levelled off at 3 million euros – the same price high as the previous year.
The sunset views make Ibiza’s west an attractive place of residence. This region is set to become even more exclusive over the coming years with the development of modern and traditional new villas. Prices here in 2016 also rose over the previous year. Entry prices for approx. 350 square metre villas in very good locations were 2.8 million euros (2015: 2.4 million euros). Fincas with a similar size and location were offered for prices starting at 2.5 million euros (2015: 2.2 million euros).
The original charm and beauty of Ibiza is particularly evident in the north of the island. Development of the road network has vastly improved the transport links to Ibiza Town. This will lead to an increasing level of exclusivity in the north in the long term. Strict building regulations and a scarce availability of properties met with a high demand are all leading to ongoing price increases. Entry prices in 2016 for villas spanning 350 square metres in premium locations rose to 3 million euros (2015: 2.8 million euros). Prices for finca properties in very good locations also started at 3 million euros (2015: 2.5 million euros).
Families and first home buyers often favour the east of Ibiza with the unspoiled natural beaches and good all-year-round infrastructure. A rise in residential property prices has also been registered in this region. Entry prices for villas here with an interior of approx. 350 square metres in very good locations increased to 2.6 million euros (2015: 2.5 million euros). Fincas with a comparable size and location changed hands here for upwards of 2.4 million euros (2015: 2.2 million euros).
Outlook: Strong demand set to continue
“We are convinced that the positive growth of the property market on Ibiza will be sustained over the remainder of the year,” said Florian Fischer. Engel & Völkers anticipates that the high demand from national and international buyers for first and second homes on the Balearic island will remain high. In the premium segment in particular, the limited number of prestigious properties will lead to further price rises in the long term.