Mallorca, Ibiza and Menorca are more desirable than ever as second home destinations. “The Balearic Islands clearly lead the property market in the Mediterranean region”, says Florian Hofer, Managing Director of Engel & Völkers on the Balearic Islands. “For ten years we have seen a growing number of property transactions on this island group involving international buyers. In 2018, the percentage of foreign customers was around 40 percent,” he continues. Potential buyers appreciate the Mediterranean flair, the impressive countryside, the easy access with short flight times and the excellent safety. The high demand on the islands is focussed on a limited supply of high quality objects in prime locations.
On Mallorca, Spain’s largest island and the heart of the Balearic Islands, the average price for residential property rose to 1.6 million euros in 2018 (+10 percent, 2017: 1.47 million euros). In prime locations in the south west and the coveted city districts of Palma, such as Palma Old Town, Portixol and Son Vida, the average price for apartments is 800,000 euros. Puerto de Andratx in the southwest is one of the highest priced locations on the island, with prices for villas averaging 4.5 million euros. It is here that Engel & Völkers achieved the highest sale price in the premium segment in 2018, at over 30 million euros. Modern villas with sea views are in especially high demand, as are restored palatial mansions and traditional finca estates with modern amenities and large expanses of land.
The increasing focus on quality and luxury tourism on Mallorca results into the further expansion of exclusive golf courses, marinas, internationally renowned hotels and high quality new-build projects. The island is still particularly highly rated by European buyers. German customers currently form the majority of buyers from Engel & Völkers (56 percent), followed by interested parties from Great Britain, Spain, Switzerland and Scandinavia.
On Ibiza, the third-largest of the Balearic Islands, property prices stabilize at a high level. In 2018 the average price for premium objects in the city of Ibiza and the surrounding area was 4.1 million euros. Apartments here achieve average prices of 950,000 euros. Villas and country houses in very good locations in the south of the island reached an average of 3.6 million euros, whereas in the north prices attained 3.1 million euros. The west of the island saw average prices of 3 million euros, the east attained prices of 2.8 million euros. Real estate ranges from historic town houses to modern apartments and penthouses overlooking marinas as well as exclusive villas in the middle of the island.
The increase in private aviation and the strong influx into the marinas is evidence that Ibiza continues to be one of the top destinations. The main clientele from Engel & Völkers are still wealthy buyers from Spain (22 percent), Germany, the Benelux countries, Great Britain and Italy.
Prices in Menorca’s prime locations have remained stable due to the high demand from overseas buyers. The most sought-after properties are holiday homes with sea views in the south east and north east. Last year, first class fincas in coastal resorts were selling for up to 3 million euros, while town houses on the island’s capital of Mahón and in the area around the harbour of Ciutadella achieved average prices of 1.5 million euros. High quality fincas even attracted top prices of up to 7 million euros. Thanks to the continued positive trend of the property market, the island authorities are investing more heavily in modernising the motorway and building a new harbour in Mahón, which will be especially designed to attract big yachts. This will attract even more international buyers in the future. The clientele of Engel & Völkers on Menorca comes predominatly from Great Britain (27 percent), Spain and France, followed by Germany, Italy and Austria.
According to Engel & Völkers, demand for high quality second homes in prime locations on the Balearic Islands will continue to increase in 2019. “Luxury properties on Mallorca, Ibiza and Menorca still offer an attractive appreciation potential, as high international demand meets a very limited local supply”, says Florian Hofer.