Menorca’s real estate market is witnessing a noticeably sustained rise in prices. According to Engel & Völkers, sale prices for residential properties have risen by some 15 percent all over the island in the last two years alone. The reason behind this trend is an increased level of demand for second homes together with an extremely limited number of properties on offer. “We have seen the largest price rises with villas and classic country estates in expensive coastal areas,” said Gary Hobson, Managing Director of Engel & Völkers Menorca.
Villas in the less touristic coastal resorts of Binibeca, Es Grau, Sa Mesquida and Alcaufar are particularly sought after among buyers. Asking prices in this segment ranged from 900,000 to 3 million euros in 2017. Fincas with panoramic views of the surrounding countryside or the sea are also highly desirable. This type of property is rare, due to the strict building regulations that Menorca must adhere to as a UNESCO biosphere reserve. “New construction on undeveloped land plots is prohibited. That is why availability of fincas in particular is extremely limited and they come onto the market so infrequently,” said Gary Hobson.
There is currently new building development potential in tourist regions and the cities of Mahón and Ciutadella. Interest among prospective buyers is focused here particularly on townhouses. Asking prices for such properties ranged from 350,000 to 1.5 million euros in 2017.
Residential properties on Menorca’s real estate market are particularly popular among buyers from the Spanish mainland and the UK. In recent years, demand has also increased among buyers from France, German-speaking countries, Belgium, and North America. One factor contributing to this development is the expansion of flight connections.
One trend emerging on Menorca is the increasing focus on quality tourism. Several boutique hotels, for example, have opened in hideaway locations – intended as relaxing retreats amidst nature. This is drawing wealthy holidaymakers to the island and, in turn, prospective buyers of exclusive second homes. More than 90 percent of Engel & Völkers clients finance the acquisition of their holiday home through private equity. In addition to private use, short-term rental to holiday guests plays a key role for some clients in their decision to buy.
Menorca is noteworthy for its wealth of beaches and remote bays. The natural beauty, Mediterranean charm, and good accessibility throughout almost the entire year make the Balearic island desirable with national and international buyers. Due to the consistently high demand and limited number of properties for sale, Engel & Völkers anticipates further price rises in the coming months. This is especially likely for properties near the coast and fincas with sea views. The restrictions on new developments mean that no major building projects are planned for the time being.
Engel & Völkers has been represented on Menorca since 2006. This summer, a new Residential Property Shop will be opening in the port town of Ciutadella.