Mallorca Property Market for 2012

2011 closed with more activity and optimism for Mallorca’s second home and residential market, with an increase in enquiries and visits, whilst sales in some areas doubled compared to 2010.
Since the end of 2008 vendors have had to adjust their pricing strategy to sell in the current market and prices overall have reduced by an average of 15-30% depending on location.
The outlook for 2012 is that prices are NOT decreasing further, the market is stable with price levels now steady. Increased sales activity from the German and Scandinavian markets in the second half of last year also reflects what most people believe – that prices will increase as demand outstrips supply, so now is the time to invest.
Further indications of the opportunities in the Mallorca Property Market have continued to appear recently in the press:

Sunday Times “In troubled times, old favourites fly high”
“Spain: Stop writing off the country as one big disaster area, we need to start distinguishing between the good quality and the appalling, and which are amongst the prime locations where we should be buying? Puerto Andratx on Mallorca.”

Country Life : Mallorca property market update
“Prime Mallorca property in the right area will still sell, although buyers can’t expect a complete bargain, Mallorca has attracted very few speculative investors and still remains what has come to be known as a lifestyle choice destination.
You cannot lump the Balearics together with the rest of Spain, in particular the mainland costas where overdevelopment has led to a vast surplus of new build apartments leading to a dramatic fall in prices.
Supply and demand in Mallorca is more evenly balanced, and as the coastal authorities and local councils are constantly tightening planning laws under the direction of the Ministry of the Environment, choice is more restricted.
In highly attractive areas such as Puerto Andratx, prime property correctly priced will sell quickly”

The Sunday Times
“German investors…..are now buying back property in their favourite haunts, such as Mallorca, so what does this mean? Is now the time for smart British investors to follow German buyers back, … at least in preferred strongholds such as Mallorca?
In prime areas such as Mallorca, the window of opportunity may shut sooner than people think. Vendors are still open to offers, and it’s far easier to negotiate with them just before prices start rising than just after, but for the first time in 18 months, Agents are actively having to look for property, so the supply of properties priced to sell is getting tighter again.”

In conclusion, Mallorca continues to have broad appeal amongst discerning buyers around the World and properties in good locations have continued to sell. Prices have dropped but as the market returns, prices for these properties have bottomed.
Pinpoint Property recommends that if you are interested in buying property on Mallorca, opportunities now are probably as good as they will ever be. So contact us now to search for you. Serious offers can still often result in a reasonable reduction if you have funds in place and can move quickly. In this way you will be assured of getting your dream property for a good price, safe in the knowledge it will prove an excellent investment.

Why Invest in Mallorca property?

Investing in Mallorca

Despite the anxiety surrounding other parts of the World at the moment, Mallorca is still a very safe investment. Property prices will always remain steady due to the fact there is limited land available for new construction, so any existing properties on the island will be in high demand.

Mallorca is one of the most expensive places to buy in the Iberian peninsula but with 300 days of sunshine every year, 23 golf courses, 25 marinas, as well as some of the most stunning scenery in Europe, plenty of Europeans consider it a sound investment.

Demand for property in Mallorca continues with 54,000 EU residents (of which 19,623 are British) now living in Mallorca permanently, together with an estimated 60,000 second home owners from UK.

Building regulations, once unheard of in Mallorca, now ensure that new homes are of a high standard; tall towers are banned in a bid to avoid Spanish mainland-style over-development; and many areas have a quasi green belt designation, so detached homes must be in large plots to avoid dense development.

Accessibility from the UK and Ireland is another major factor in the success of the Mallorca property market with reasonably priced flights of around 2 hours available from Belfast, Birmingham, Bristol, East Midlands, Edinburgh, Exeter, Glasgow, Liverpool, Leeds, Manchester, Newcastle, Southampton and all London airports plus Dublin and Shannon. Links with the rest of Europe, especially Germany and Scandinavia are also extensive.

This provides a huge market for property investors looking for long or short term rental income in addition to capital appreciation.

The Island has always understood the benefit of foreign investment and make property acquisition and legal procedures simple with no language skills required. For income tax the flat rate is 25% of the gross rental income and Capital Gains Tax is applied at 18% for E.U. non-residents and residents alike.

A resourceful infrastructure provides all the necessities for absent landlords with an abundance of property management companies providing all necessary key-holding, maintenance and security services, backed up with a proficient service industry.

With our specialist Pinpoint Property Investor Service, we understand the very specific needs of Investors and with our expertise and knowledge of the Island are able to provide information on new and forthcoming developments, some before marketing commences – very difficult unless you are based here.

Pinpoint Property Investor Service will work on a brief from Investors to identify investment opportunities in the real estate sector, using our network of contacts, both agents and developers. We will undertake all the necessary work involved in researching, analysing and preparing a unique individual property portfolio – saving you time, money and hassle.

Contact us with any initial queries and we would be pleased to arrange a meeting to discuss your requirements further.

See our guide to Property Locations in Mallorca

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