Engel & Völkers in the Balearics has had a cracking first half of the year, with sales turnover of 278 million Euro - our second best half-year results ever since we opened our first office in the Balearics 28 years ago. Mallorca (Majorca) is the biggest property market in the archipelago, which also includes Menorca (Minorca), Ibiza, and Formentera.
As the leading upmarket real estate agency in Mallorca with a powerful global brand, our sales growth has been driven by strong demand from international buyers, in particular from German-speaking countries.
The outstanding beauty of Mallorca’s natural environment is reason so many wealthy second-home buyers have the island in their sights. And the beauty of Mallorca as a property investment is its appeal to upmarket buyers from all over the world, especially from German-speaking countries, where Mallorca’s spectacular natural environment and high-quality housing stock are highly prized.
Public data from the Association of Spanish Notaries makes clear how much property investors from Germany love the Balearics, and Mallorca in particular. German buyers were 47% of the second home market and 24% of the first home market in 2017, in both cases the biggest group of foreign buyers by a wide margin.
German-speaking buyers from Austria, Switzerland, and, of course, Germany itself, have a reputation for being the most demanding clients when it comes to buying property in Spain. Accustomed to living in well-built properties in their home countries, they expect the same level of quality in Mallorca as they do at home. This helps explain why new developments in Mallorca are some of the best built in all of Spain. The quality of homes in Mallorca benefits all international investors, not just German-speaking buyers.
Mallorca’s reputation for quality, its outstanding natural environment, the shortage of land that comes with the territory of an island, and growing international demand led by German-speaking buyers continues to put upward pressure on house prices. Our half year results show the average transaction value of property sold by Engel & Völkers increasing from approximately 1.2 to 1.4 million Euro in the first six months of 2018 compared to the same time last year. “This clearly demonstrates that the Balearics continue to attract financially-strong investors,” says Florian Hofer, Managing Director of Engel & Völkers Balearic Islands. “In addition, we are very proud to have had the largest sale ever in the history of Engel & Völkers in the Balearics.”
Sales and house prices in Mallorca have been steadily increasing for the last eight years, our figures show. New figures from the National Institute of Statistics showing a monthly decline in home sales in May are almost certainly due to supply shortages, in our opinion. Mallorca’s international appeal to wealthy buyers, and its limited supply of homes for sale, makes for a compelling investment case.
Article written by Mark Stücklin on behalf of Engel & Völkers Mallorca