Our recently published results for the first half of 2018 - our second best half-year on record - confirmed that Engel & Völkers’ sales growth in Mallorca has been driven by strong demand from international buyers, in particular from German-speaking countries. In this interview, Florian Hofer, Managing Director of Engel & Völkers in the Balearics, explains these market based on his many years working with German-speaking clients.
Q: What are the different segments of demand?
A: Generally speaking, in Mallorca the German/Austrian/Swiss buyer is looking for a second home. Our clients are typically from the successful middle class, often managers or entrepreneurs from the entertainment or sports industries and are looking for themselves or their family for a sunny, safe and easily reachable second home property by the sea. Some of the buyers are multi-property owners.
Q: What are their main motivations for buying property in Mallorca?
A: Their main motivations are sunshine (climate), sea, Mediterranean lifestyle, safety, quality to a certain standard. Also, they are buying property in Mallorca because it has proved to be a safe, long-term investment.
Q: What are their preferences when it comes to buying in Spain? What are they looking for?
A: German-speaking clients are as individual as our products. It is not easy to define a search pattern according nation. Perhaps we can see a tendency among them to look for new or refurbished properties, which are not only turnkey but already furnished. We have noticed that properties which are furnished by professional interior designers, and are equipped with high-quality interior-equipment, are very well-received by our clients. Foreign clients in general do not want to rebuild and furnish the property. They really appreciate it if they receive the “full package” and are able to move in with the luggage. German-speaking clients focus on properties with good locations, most of them are coming to Mallorca to have a rest and to recharge their batteries.
Our German-speakers are also focused on quality and buying in higher price segments. In Mallorca areas like the Southwest (from Palma to Andratx), the South and Southeast (from Palma to Santanyí) are very popular with this market. Also popular are the Northeast and Mallorca Central.
Q: What are their main concerns about buying property in Spain?
A: German clients are very rational and fact oriented. In their home markets they are used to evaluate the property upon m² price. Here there are some other key factors when buying a property including a good location, the country/sea views, the furnishing and the general condition of the property. When buying in this region apart from making a rational decision, emotion is also an important factor. Sometimes Germans are a bit surprised about these differences but they adapt themselves to this quickly. At the end it is the “Mediterranean lifestyle” which makes the Southern countries so attractive for German-speaking buyers. There is a renewed confidence in the economic situation in Spain, particularly in Mallorca.
Q: Are they easy clients to deal with?
A: Yes, German-speakers are easy clients to deal with. They are mostly goal and detail-oriented. Integrity, correctness, rationality and straightforwardness are their greatest virtues and that is why it is very pleasant to deal with them professionally, even with larger transactions.
Q: Are they cash buyers or do they need mortgages?
A: In Mallorca our German speaking buyers are mostly cash buyers. Here, we can observe a different buyer behaviour than the same buyer has in his home country. In Germany it is common to finance a property. But if it is about a second home residence, most of the German speaking clients do not want finance the property. Germans afford themselves the “luxury” to own a second home in the Balearics if they have sufficient finances for it.
Q: Do you see this demand growing or shrinking? Why?
A: There is a global growing demand in properties and so we can see a growing demand in property in the Balearic Islands. Security, easy access, and good infrastructure are the main reasons why our region is among the most beloved destinations for German-speaking second home buyers.
Article written by Mark Stücklin on behalf of Engel & Völkers Mallorca
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