Millions of people per year go to the Balearic Island of Menorca to relax, unwind and get away from it all. But why are so many people now buying property in Menorca? There could be several reasons ranging from second homes, beach homes or even investment properties. People in general love the culture and evident history Menorca proudly displays.
Menorca’s Culture
The primary languages spoken on Menorca today are Catalan and Spanish. Due to her colorful past, some of the most vibrant celebrations in the world are held on Menorca. Two of the most famous and traditional summertime festivals are:
* Sant Joan, held in Ciutadella on June 24 includes the beautiful Menorcan horse as an integral part of the event.
* Dia de Virgen de Carmen is the feast of the patron saint of sailors. This festival is held all over the Balearic Islands in mid July.
The Menorcan horse has been carefully bred to have a very elegant shape and a coat of blackest black. Its main and tail are long, black and silky. These horses are a very prominent part of most Menorcan festivals, as they are a very distinct reminder of the island’s history and culture.
Healthy Mediterranean Diet
Gin is a favorite drink, especially during festes when it is mixed with bitter lemon. The resulting drink is called Pomada, locally. Low to moderate amounts of wine are consumed as well. The Mediterranean diet includes high consumption of fruits, vegetables, breads, cereals and locally grown potatoes, beans, nuts and seeds. Olive oil is a very important source of monounsaturated fat in the Menorcan diet. Red meats are very rarely included in the typical Mediterranean diet, while fish, poultry and dairy products are consumed in low to moderate amounts.
Lower incidences of heart disease, high blood pressure and cholesterol levels in the Mediterranean are believed to be due to the diet. The Menorcan lifestyle is generally more active than other parts of the world, resulting in lower death rates as well as lower obesity rates. In fact, Menorca is home to several citizens who are over 100 years old.
Menorca’s History
Menorca was named by the Romans. The name aptly means ‘Little One’. It is the smaller of the Balearic Islands. Majorca means ‘Large One’ and is the largest of the Balearics. Menorca’s documented history dates back to around 2100 BC and some of the oldest structures on the island are believed to be approximately 3,500 years old. More than 200 towers, believed to have been siege towers, still stand.
Menorca is home to a very large collection of megalithic structures. Some of the monuments include navetas, or chamber tombs, that date back to the early Bronze Age. Taules are t-shaped stone monuments that include a tall vertical stone with a long horizontal stone lying on top of it. At least 274 talaiots have been found on the island. A talaiot is a stone structure that was used for defensive purposes. Other possible purposes are not clearly defined or even understood.
Menorca has been a strategic point for refugees, pirates and leaders staging attacks on other countries. It has been under the rule of many distant civilizations including the Romans, the Moors, Britain, Spain, and even no official rule at all in its earliest days. The many coves and beaches provided shelter and a home for pirates. Evidence of piracy can be found in the waters surrounding the island. Divers often enjoy the ability to witness this little part of the past.
Posts Tagged ‘Real Estate’
Making the Move to Menorca
Friday, December 4th, 2009Building Up Trouble In Spain
Tuesday, December 1st, 2009Spanish real estate has hit turbulence recently, with the Costa del Sol dropping from the favourite area to buy to least popular in just two years, leaving hundreds of thousands of holiday home owners vulnerable to a sharp drop in prices this year.
The Costa del Sol has been particularly hard hit as different negative factors came into play at around the same time – ‘land grab’ – where developers take land from existing owners with little recompense, world market jitters, and local corruption.
Another complication has hit the property market on the popular holiday island of Mallorca. Plans have been put forward for more developments, and the local populations has successfully organised mass protest against development plans which they think will destroy much of the island’s culture and heritage.
Mallorca’s economic base featured farming, livestock and agriculture before the 1960s. Before it became dependent upon tourism, Mallorca prided itself on being able to take care of itself without outside influence. The rising climate has made it hard to farm or raise livestock on the island. Limited water supplies make it difficult to maintain any kind of crop. The sparse amount of agriculture that is still done in Mallorca is in an effort to keep up with the demand from tourists, and more development could spell disaster for the traditional way of life.
According to the 2005 census, the population of the city of Palma was 375,048. The population of the entire area was estimated to be 517,285; the 12th-largest urban area of Spain. Approximately half of the total population of Mallorca lives in Palma, and it is feared that more developments will see Mallorca turned into a concrete jungle.
Mallorca started to develop as a tourist hot spot in the 1920’s. Mallorca now has more than six million visitors each year, yet ninety-five percent of tourists concentrate in only five percent of its territory. Less developed areas of this elegant island are ripe for new development and prime property commands a great premium. It seems more people than ever before want to live on or invest in Mallorca, but locals fear a doubling or trebling of the full time population in just a few years, placing a strain on the island’s hospitals, schools and infrastructure, and vow to fight development plans.
A United Nations report highlights problems for both the Costa del Sol and Mallorca, showing that local authorities are over dependent on new properties being built, with some city halls receiving over a quarter of their income from property related activity – a figure only sustainable by allowing more and more new developments, which eventually run contary to the wishes of the local populations.
The report says that there has been ‘uncontrolled speculation for the last twenty years’ and contributes to a poor housing situation for Spain’s domestic market, with many developers preferring to concentrate on holiday villas and apartments to providing good standard housing for local people.
And it’s local people in different regions of Spain who might change the way the property market works in the future, more for themselves than for outsiders.
The report says that the hardest hit sections of society in the Spanish property market are the young and the elderly, women, gypsies and the disabled – and as mallorca has seen people are pushing housing policy higher up the political agenda.
The UN report also says that some fifteen per cent of Spain’s apartments lie empty, even after discounting overseas owners.
‘The amount of housing that isn’t occupied might look alarming’, comments a Mallorca internet site, ‘But this isn’t unusual. The same could be said of London, or among the Mediterranean countries Malta for example.’
Island Lights In Real Estate Darkness
Sunday, November 29th, 2009At times of poor economies property prices more often than not fall, and the property market in itself is sometimes enough to cause a recession in the rest of the economy as home owners see their top asset slashed in value, and cut back on spending as a direct result of feeling less wealthy.
2008 has already seen the world’s financial markets in turmoil with a rogue trader in France losing billions of Euros for his bank, and the Federal Reserve aggressively cutting interest rates to try and stave off a recession in the US.
But among the gloom, those involved in real estate markets around the world can often point to areas where property bucks the trend, and is on an upward move despite all that is happening to property elsewhere.
A prominent UK real estate site predicts that France will see a rise in property values for 2008 of between 5 and 8 per cent.
The advantages France has compared to some European markets is that the British buy there extensively, and have done for over twenty years now. The recent upgrading of the channel tunnel could ensure interest remains high in Northern France, easily accessible from London and her Home Counties.
Two countries who share borders with France are also likely to be areas where property prices will increase in 2008 – the tax havens of Andorra and Monaco, which have similar tax benefits.
Monaco because tax havens are in demand whatever is happening to the economy, and the supply of properties is short with new supply not coming on stream for another three to four years. Andorra will continue to enjoy the overspill from Monaco, where studio apartments start at around a million Euros, while in Andorra the same million Euros will buy a house.
Further into Southern Europe the UK property site suggests both Mallorca and Tenerife could see property price gains, and with local populations on both Spanish islands becoming restless about the amount of future developments to be allowed the supply of new apartments and villas could be limited.
Mallorca – often known as Majorca – is the main island of the Balearic Islands, which also includes Menorca and Ibiza. Located in the Mediterranean off the east coast of the Spanish mainland, Mallorca is the largest of the Balearic Islands and sees most tourists – some of whom ultimately buy a holiday home on the island or move there full time. According to the 2005 census, the population of the city of Palma was 375,048. The population of the entire area was estimated to be 517,285; the 12th-largest urban area of Spain. Approximately half of the total population of Mallorca lives in Palma, but many newcomers steer to the coastal resorts such as Alcudia.
And while 2008 may appear to be gloomy for the real estate sector, there will no doubt be some light among the darkness of falling prices in some areas of Europe.
Buying A Property in Ibiza
Saturday, November 21st, 2009Ibiza was always famous as a tourism destination and then it shaped into becoming the trance capital of Europe and now it is considered as one of the emerging real estate markets in Europe and the world. But if you are planning to buy real estate property in Ibiza then you need to be well informed regarding property costs and taxes. As a standard, around 10% to 11% is added to the cost of a property in Ibiza and Majorca to cover the tax liabilities as well as other miscellaneous costs.
This cost will include IVA, which is the Spanish equivalent of VAT. IVA is calculated at 6% of the actual value of any pre-owned home or at 7% of the actual value of a new real estate property chosen by you. This cost will cover stamp duty (0.5% is charged presently), which is a fee that you will need to pay to the Spanish property registration office. You will also be charged 1% of the sale value of your property as a charge towards the copies of the ‘escritura publica’ as well as legal fees.
Another important thing to note is that if you are buying a particular property from a non-Spanish living in Spain then you will need to deposit 5% of the actual sale price of the property with the local tax office in Mallorca or Ibiza. Situated 52 miles from the Spanish coast, the Balearic Island of Ibiza is in spite of the property taxes and other costs, is still a hot real estate market. It is an island where you will find a healthy mix of the Spanish culture and modern lifestyle. This is one of the biggest reasons why investors are queuing up to buy properties in different parts of Ibiza from the beaches to the mountains.
Properties in Ibiza are from expensive to affordable and it all depends on the type of property, size, and most importantly the location. Most people like to invest in villas overlooking the sea or in apartments and small homes high up in the mountains. Off late, there has been an increase in the price of upper-segment homes but apartments on the Island are still affordable and you can buy a nice 2bed/2bath studio apartment for as less as €100,000. In spite of the recession across world real estate markets, there seems to be a stability in the Real estate in Ibiza and this promises a favorable growth in the years to come.
Alarm Bells Ring For Spanish Property
Friday, November 20th, 2009Buying a property in Spain has been an aspiration for many Europeans in the last twenty years, with Germany and the UK providing most buyers.
But the Spanish real estate market has hit some turbulence recently, with the Costa del Sol dropping from the favourite area to buy to least popular in just two years, leaving hundreds of thousands of holiday home owners vulnerable to a sharp drop in prices this year.
The Costa del Sol has been particularly hard hit as different negative factors came into play at around the same time – ‘land grab’ – where developers take land from existing owners with little recompense, world market jitters, and local corruption.
Another complication has hit the property market on the popular holiday island of Mallorca. Plans have been put forward for more developments, and the local populations has successfully organised mass protest against development plans which they think will destroy much of the island’s culture and heritage.
Mallorca’s economic base featured farming, livestock and agriculture before the 1960s. Before it became dependent upon tourism, Mallorca prided itself on being able to take care of itself without outside influence. The rising climate has made it hard to farm or raise livestock on the island. Limited water supplies make it difficult to maintain any kind of crop. The sparse amount of agriculture that is still done in Mallorca is in an effort to keep up with the demand from tourists, and more development could spell disaster for the traditional way of life.
According to the 2005 census, the population of the city of Palma was 375,048. The population of the entire area was estimated to be 517,285; the 12th-largest urban area of Spain. Approximately half of the total population of Mallorca lives in Palma, and it is feared that more developments will see Mallorca turned into a concrete jungle.
Mallorca started to develop as a tourist hot spot in the 1920’s. Now, Mallorca sees more than six million visitors each year, yet ninety-five percent of tourists concentrate in only five percent of its territory. Less developed areas of this elegant island are ripe for new development and prime property commands a great premium. It seems more people than ever before want to live on or invest in Mallorca, but locals fear a doubling or trebling of the full time population in just a few years, placing a strain on the island’s hospitals, schools and infrastructure, and vow to fight development plans.
A United Nations report highlights problems for both the Costa del Sol and Mallorca, showing that local authorities are over dependent on new properties being built, with some city halls receiving over a quarter of their income from property related activity – a figure only sustainable by allowing more and more new developments, which eventually run contary to the wishes of the local populations.
The report says that there has been ‘uncontrolled speculation for the last twenty years’ and contributes to a poor housing situation for Spain’s domestic market, with many developers preferring to concentrate on holiday villas and apartments to providing good standard housing for local people.
And it’s local people in different regions of Spain who might change the way the property market works in the future, more for themselves than for outsiders.
The report says that the hardest hit sections of society in the Spanish property market are the young and the elderly, women, gypsies and the disabled – and as Mallorca has seen people are pushing housing policy higher up the political agenda.
The UN report also says that some fifteen per cent of Spain’s apartments lie empty, even after discounting overseas owners.
‘The amount of housing that isn’t occupied might look alarming’, comments a Mallorca internet site, ‘But this isn’t unusual. The same could be said of London, or among the Mediterranean countries Malta for example.’
Property developers in Spain and the Spanish islands face a torrid 2008, as new developments are scrutinised more before being given planning consent, and an economic downturn threatens to drop the number of new buyers substantially.
Spanish Property
Thursday, November 19th, 2009ABOUT SPAIN
Steeped in history, culture and tradition, Spain conjures up images of beautiful beaches, classical art and architecture and a passion for life – whether that be for football, dance or bull fighting. Whether you like to explore gothic cathedrals, enjoy the local food and wine, or relax by the Mediterranean Sea, it is easy to realise why more than 50 million people visit Spain (the second most visited country in the World, after France) each year.
Located in the South West of Europe, Spain has borders with Portugal and France but is otherwise surrounded by the Mediterranean Sea, the Bay of Biscay and the Atlantic Ocean. Spain enjoys a warm and sunny climate for most of the Summer and for some areas in Winter months. As well as mainland Spain, the Balearic Islands (Ibiza, Minorca, Majorca) and the Canaries (Tenerife, Lanzarote, Grand Canaria) are popular destinations for tourists.
The Iberian Peninsula was occupied by the Romans in the 2nd Century BC and the region of Hispania was formed. In the 8th century, the Berber Muslims (or Moors) conquered the whole of the peninsula and large populations of Christians, Jews and Muslims lived in close proximity. It wasn’t until 1492 that Spain became a Christian country (now predominantly Catholic). That was also the year that Christopher Columbus, funded by the Queen Isabella, discovered the “New World” and the Spanish Empire was one of the most powerful in the World. Spain had a large number of colonies in Central America and Mexico and many modern-day states of the U.S.A.
At the end of the 19th Century though, Spain lost its colonies in the Spanish-American and there was some instability resulting in the Spanish Civil War (1936 – 1939) with a dictatorship established by General Franco. It wasn’t until 1975 (on Franco’s death) that Juan Carlos (grandson of King Alfonso XIII) was named successor and Spain became a democracy.
Although a Constitutional Monarchy, Spain has a number of regions (17 autonomous communities and 2 autonomous cities) all with separate identities and histories and in some cases – languages. People in regions such Catalonia, the Basque Country and Galicia, relate firstly to the region and then secondly as being part of Spain.
Property Market
In recent years, there has been a large increase in the number of overseas investors buying property in Spain, either as second homes or main residences. In 2005, there were around 3.7 million foreign residents in Spain which highlights the popularity of the country for immigration. There are large communities of British, Argentineans, Germans and Bolivians resident in the country.
The country has long been a favourite holiday venue for many, with the British among the most frequent visitors. Among the types of property available, apartments, holiday homes and villas have been the most popular. The direct comparison with the UK weather and climate offers the perfect venue for that summer break, or some where to retire in later years – with many older UK citizens taking the opportunity to emigrate to Spain after retirement.
After historic periods of volatility, the Spanish economy has been fairly stable for some time, and the relatively low interest rates further encourage inward investment. While Spain is a vast land of differing terrains, the transport system offers easy access by car, plane or train. As visitor numbers are forecasted to grow substantially over the next few years, further investment in the infrastructure is essential and in hand.
This forecasted influx of visitors will ensure a healthy demand for property, and under a careful new-build program, demand will always exceed supply. While there was a large increase of 17.5% in the price of residential property in the second quarter of 2003 (compared to same period in 2002) this kind of return is unsustainable. A more gradual return is expected over the next few years, with little potential for downside in the short to medium term.
The government recently announced reforms which are aimed at increasing the buy-to- let portion of the market from 11% to 20%, thereby releasing some pressure from the purchase market. Some 3.1 million unoccupied homes are to be brought into the market, which will again relieve some of the pent up demand experienced in recent years.
Why invest in Spain ?
Unlike countries such as the UK where stock market investment is very popular, Spanish residents have switched a large portion of their investments from the stock market to direct property investment.
There is no doubt that the Spanish economy is driven by the holiday market, and Spain has been a popular location for many years. As UK property prices have shown massive rises over the last few years, many are now switching to the Spanish market which offers better value for money. This constant flow of visitors has also encouraged a lucrative rental market, with attractive returns available, especially in the coastal areas.
As coastal property prices have shown good growth over recent years, the effect is starting to spread inland where the more sedate and quieter regions are proving popular with the older generation. So whether you are looking for that vibrant, busy environment or a quieter, slower pace of life, there is something for everyone.
Outlook
While the property returns seen over the last 10 years are set to slow, many are forecasting a steadier more controlled property market, with constant demand ensuring an upward trend for the foreseeable future. There are currently a number of long term property developments ongoing, which will flatten the supply / demand trend line. Doom and gloom predictions for the Spanish property sector appear to be wide of the mark.
Spain really does have something for everybody, whether you are looking for the architecture and art museums of Barcelona, the energetic night life of Ibiza or the quiet life of Fuerteventura. Foreign investment in the property sector is still rising and is the main driving force behind the growth in the sector.
The buy-to-let market is also attracting lots of interest as the trend for overseas holiday homes continues. After the emergence of the budget airlines, it is now as quick to travel to Spain, as it would be to travel far afield within the UK.
Spanish Property To Drop Value 2007
Saturday, November 7th, 2009In some parts of Spain, so many British people have bought a property it is quite possible to live there quite comfortably without having to learn the language.
While many Brits do learn Spanish and socialise with locals who haven’t moved away because of the high property prices, many of the bars and restaurants and other businesses are British owned.
Helping to create the enclaves within their own country some Spaniards have sold their property to move to more traditional – and less expensive – areas, while young Spaniiards have had no choice but to leave their traditional family villages and towns as property prices have been too high.
And while the British who have moved to Spain over the last twenty years have seen their investments rise in value, consistently above the price of inflation, they could been in for an unpleasant surprise with signs that the housing market in Spain is weak, and prices could soon drop.
So spectacular have the price rises been over the last ten years that many Spanish homes on the Costas have doubled and more in value.
But developers have been busy, building hundreds of thousands of new homes, and this is leading to oversupply. 2006 saw 800,000 new home starts, more than Italy, Germany and France put together – a staggering amount by any European country’s standards.
Often developers are offering low cost inspection trips to potential property buyers, and the buyers don’t even get to see re-sale properties during their house hunting trips.
With many apartments and houses on a mortgage, interest rate rises push more and more people to selling, especially for second homes when the lettings no longer cover the mortgages. Since Spain joined the Euro, she has lost control over setting her interest rate, and all those in the Eurozone have had several rises in the last twelve months.
The Spanish island of Majorca reflects well the precarious position many second home and full time residents are facing should interest rates rise again across Europe.
Already many locals are finding it increasingly difficult to get on the property ladder, with prices having risen consistently in recent years, with their best hope being a slow down or even drop in Majorca property prices.
A survey recently found that over 90 per cent of Majorca’s domestic population were worried about the number of overseas people buying property on the island.
One travel guide for Majorca isn’t surprised at the local opinion.
‘It’s difficult for local people, especially when they are in their twenties and thirties and working with decent salaries, to see villas which are hardly used when they often can’t even get a good size apartment in the areas they want, close to family or work.’They say, referring to holiday homes that are used a few weeks or even long weekiends a year, and standing empty the rest of the time.
‘They see these properties as some of the cause of high prices, and they cannot see where it is going to end,’ they conclude.
‘The problem with building a way out of the housing crises, by constructing dozens of new apartment buildings and villa complexes is that it spoils the whole nature of Majorca, and it’s a catch 22 because while locals do want to buy a house, they don’t want it at the expense of the island.’
Official figures for Majorca holidays this year indicate an increase in tourist numbers by between five and seven per cent. And it is from the pool of holidaymakers where property sales often happen a few months later, as some visitors like the island so much they decide to look into buying an apartment or villa, with some even retiring to the island, or buying a business.
With the increase in visitor numbers, property demand should in theory be high for 2007 overall, but time will tell if the higer interst rates see a drop in prices in Spain and Majorca.
British Banks Open For Spanish Property
Thursday, November 5th, 2009One of Britain’s best known banks and mortgage providers is to open three new offices on the Spanish islands of the Canaries plus the Balearic island of Menorca to meet demand for Britons looking to buy a home in Spain.
The decision by the Halifax was taken from data showing a trend towards Britons buying homes overseas, with Spain the most popular choice.
Part of the expansion decision was to open in Menorca, the quietest of the three Balearic Islands. Commenting on the move a local travel guide commented:
‘While Majorca and Ibiza are possibly better known than Menorca, it’s perhaps not so surprising that the bank has decided to open an office on the island. The typical buyer for property in Menorca is often older than that for Majorca and Ibiza, which could mean they are hoping to service their investments and pensions along with a normal account – especially for those moving full time to Menorca.’
Commenting on the new bank branch in Menorca, the company said that the opening of branches away from mainland Spain is an important step in the development of their branch network, and that they will continue to target the Spanish islands in addition to their Spanish mainland business.
Once bought, Menorca villas are often let out to holidaymakers, with the season generally running from May to end September.
As one of the Balearic Islands Menorca is situated close to better known Majorca, which like Menorca has welcomed many visitors back to live full time on the island. Menorca property has proved popular too, for those looking for a gentler pace of life than big sister Majorca.
Property prices in Majorca are similar to Menorca property, with a range of apartments and villas in both rural and town locations, and with twenty golf courses plenty of golf course developments too.
Menorca has just the one golf course, recently extended to eighteen holes, and is located in Son Park, which has a choice of hotels, apartments and villas for holiday makers.
The cost of flying to Menorca and Majorca has come down in recent years from most European countries due to low cost airlines, especially in the island’s core tourist areas of the United Kingdom and Germany, and last year easyJet started direct flights from London’s Gatwick Airport to Menorca, having served Majorca for some years already.
The third island in the Balearics is Ibiza, which in turn attracts a different age group and property buyer compared to Menorca and Majorca.
Clubbers from around Europe, and especially from the UK, descend upon Ibiza in the summer months for a week – and often two – of non stop partying.
Ibiza runs second only to the UK’s main cities of London, Manchester and Liverpool in terms of popularity for clubbers, and some of the Ibiza clubs are as well known as any in the UK, with some clubbers visiting frequently enough to consider buying an apartment on the island.
Demand for flights to Ibiza has been high enough in recent years for a low cost airline to start two new services from the UK to Ibiza, which should see the number of tourists on the island rise this year.
The two new routes are from Edinburgh in Scotland twice weekly, and London’s Luton Airport with both routes offering a daily service. This will be an attraction for those considering buying a property on one of the Spanish islands, and this in time will again attract the British banks to open new offices to cater for those considering buying an apartment or villa.
Mallorca Property Developers Face Local Opposition
Thursday, November 5th, 2009Holiday homes and investing in a property on the Spanish island of Majorca has been popular for several decades now, with many Europeans who have holidayed on the Spanish island deciding to buy a second home for holidays, a business, or for retirement.
But now the Mallorca islanders are concerned that future development plans could ruin the island, and if left unchecked the island could become a concrete jungle.
Already many locals are finding it increasingly difficult to get on the property ladder, with prices having risen consistently in recent years, with their best hope being a slow down or even drop in Majorca property prices.
A survey recently found that over 90 per cent of Majorca’s domestic population were worried about the number of overseas people buying property on the island.
One travel guide for Majorca isn’t surprised at the local opinion.
‘It’s difficult for local people, especially when they are in their twenties and thirties and working with decent salaries, to see villas which are hardly used when they often can’t even get a good size apartment in the areas they want, close to family or work.’ They say, referring to holiday homes that are used a few weeks or even long weekiends a year, and standing empty the rest of the time.
‘They see these properties as some of the cause of high prices, and they cannot see where it is going to end,’ they conclude.
One way out is to build more properties, but this is what has sparked many of the protests against further development.
‘The problem with building a way out of the housing crises, by constructing dozens of new apartment buildings and villa complexes is that it spoils the whole nature of Majorca, and it’s a catch 22 because while locals do want to buy a house, they don’t want it at the expense of the island.’
Official figures for Majorca holidays this year indicate an increase in tourist numbers by between five and seven per cent. And it is from the pool of holidaymakers where property sales often happen a few months later, as some visitors like the island so much they decide to look into buying an apartment or villa, with some even retiring to the island, or buying a business.
With the increase in visitor numbers, property demand should in theory be high for 2007 overall.
Current prices for property in Majorca include brand new 2 bedroom 2 bathroom apartments in Puerto Pollensa at 285,000 Euros, a country house with its own pool at 1,500,000 Euros, and a three bedroom three bathroom villa with its own pool at 900,000 Euros, around UK 600,000.
Majorca Real Estate Prices Could Drop 2007
Tuesday, November 3rd, 2009Spain’s Majorca real estate has been popular for several decades now, with many Europeans who have holidayed on the Spanish island deciding to buy a second home for holidays, a business, or for retirement.
Prices have risen on the island as buyers – mainly British and German – have moved in, but there are mixed signals coming from the property and tourist sectors, which could see a freeze in Majorca property inflation, and possibly even a dip in prices in the near future.
Official figures for Majorca holidays this year indicate an increase in tourist numbers by between five and seven per cent. And it is from the pool of holidaymakers where property sales often happen a few months later, as some visitors like the island so much they decide to look into buying an apartment or villa, with some even retiring to the island, or buying a business.
With the increase in visitor numbers, property demand should in theory be good.
Cheap Majorca flights have been running for some years now, and even with increased air tax in the UK, Majorca is easily accessible from more than a dozen airports in the UK for property owners and tourists alike, with a flight time of under two hours, allowing a market for weekend homes for overseas property buyers.
Although one of the earliest package holiday destinations with tour companies, Majorca has had new competition in recent years from the former Soviet Bloc countries in Eastern Europe, that are now able to offer cheap holidays to the British market, and for the property market countries like Croatia and Bulgaria have been able to offer apartments and villas at a fraction of the price Majorca can offer.
In response, the island has fought back showing it’s not just the weather in Majorca that attracts property buyers, but a well established market with the infrastructure in place to protect overseas investors money.
Domestic Market
Any slow down or possible reversal of property prices could be welcomed by the local Majorca population.
They have seen the price of property in Majorca escalate, and many have been priced out of buying their own home.
This has led to some protests, with a demonstration against plans for more development in Majorca being held earlier in the year, with the belief that developers will destroy what is left of Majorca’s open spaces, and rendering the map of Majorca unrecognisable in years to come.
With encouraging tourist figures, Majorca hasn’t been resting on her laurels. This summer’s SuperCup yachting event has seen the appointed of an experenced race organiser, in an attempt to make the event more high profile.
Similarly, neighbouring island Menorca is hosting a Classic Yachts weekend, with entrants expected from across Europe, with the event boosting occupancy for Majorca hotels.
Of the three Balearic Islands, Ibiza comes top for spending per tourist according to official recent statistics, reaching nearly a hundred Euros a day per tourist, with Majorca second, and Menorca third.
Current prices for property in Majorca include brand new 2 bedroom 2 bathroom apartments in Puerto Pollensa at 285,000 Euros, a country house with its own pool at 1,500,000 Euros, and a three bedroom three bathroom villa with its own pool at 900,000.