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Mallorca Real Estate Market Report Q3-Q4 2012

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2012 was a difficult year for the …

2012 was a difficult year for the
Mallorca market. Despite positive
official figures our on the ground
experience indicates that many
buyers consider that the market is
still overpriced.

Published in: Real Estate

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  • 1. MALLORCA REAL ESTATE MARKET Q3 & Q4 2012 In 2012, we saw continued strong with increasing interest from the Unites States, Canada and Australia ininterest in short-term rental and the purchasing Mallorca luxury properties in 2012.” says Rafael Calparsoro, Director ofbest properties on the island were Lucas Fox Mallorca.sold quickly Rafael Calparsoro Lucas Fox Mallorca Sales Director “We expect this interest to continue in 2013, as well as from our traditional markets across Europe and the UK, andMallorca Real Estate Market: we expect the number of transactions the interest from Russia which has beenSummary of luxury property to increase building for the past two or three years through 2013 as more discounted to keep growing.”2012 was a difficult year for the properties come onto the market andMallorca market. Despite positive international buyers purchase the best “The islands’ natural beauty, theofficial figures our on the ground of these properties in prime locations. fascinating charm of Palma’s Old Town,experience indicates that many world class golf facilities, and easy accessbuyers consider that the market is “In 2012, we saw continued strong by yacht and air are well appreciated bystill overpriced. This is reflected by interest in short-term rental and the visitors to Mallorca. For the last severalthe fact that those transactions that best properties on the island were years, the island has become a havenare taking place are closing at prices sold quickly as buyers were reluctant for many returning visitors lookingconsiderably below asking price. We to let opportunities linger too long. for luxury travel opportunities in anexpect more discounted properties to We also saw growth in new markets, unforgettable location,”come onto the market and hope thatthis should reanimate the market asmore diverse international buyers catchon to the quality property and locationadvantages of the Balearic Islands.“In our opinion the Mallorca propertymarket is still somewhat overheatedwith many property owners continuingto aim for unrealistic sales pricesdespite the fact that their propertieshave been on sale for several years”.Said Alexander Vaughan, Director andCo-founder of Lucas Fox. “There aresome green shoots in the market and Property Sales Transactions: Mallorca and Spain: 2012 / Source: ine.es MALLORCA REAL ESTATE MARKET Q3 & Q4 2012 www.lucasfox.com
  • 2. Mallorca Property Transactions Town. Larger apartments with more 2011 2012 than 200 square meters and properties 4000 with sea views sold for between €1.2The official figures show that Mallorca and €1.8 million throughout the year 3000and Ibiza had a year of strong trading in2012, with 30% more sales transactions 2000recorded in some quarters than in Mallorca Rental Market2011. In particular, February, May and 1000August saw increased property sales Average rents per square metre felltransactions, with patterns again slightly in all Mallorca regions between 0trending upward entering into the the first and final quarters of 2012, Jan Feb Mar Apr May Jun Jul Aug Sept Oct Nov Decfourth quarter of the year. In our although no area suffered more thanopinion these positive figures are a 40 centimos reduction in average Mallorca Airport Arrivals (‘000s):mainly as a result of increased activity price per square metre, according to 2011 & 2012 / Source: Aena.esin the Ibiza property market. webportal Fotocasa. Calvia in West Mallorca rose slightly by mid-year butMallorca Property Sales Prices then dropped again slightly, ending during the year, a drop of only 0.3% the year on €8.89. The Q2 increase in on 2011 figures and defying national price reflected the healthy demand trends, where passenger arrivals wereProperty prices held fairly steady across down 5% as Spanish residents curtailed for quality short-term rentals acrossall of Mallorca’s regions in 2012. In the travel in the wake of rising sales taxes. the island, particularly in the summerisland’s capital of Palma de Mallorca, Mallorca’s luxury status as a major months.average sales prices started the year at destination for international travellers Overall, Mallorca rental properties€2,101 per square metre and ended 2012 protected the island’s tourism sector ended Q4 2012 with an average price ofon €1,955 per square metre. Amongst and helped contribute to the strong €7.55 per square metre.Lucas Fox clientele, sea front properties, local economy.country houses and country estates Short-term rental demand is indicated,across all areas of the island dominated in part, by levels of airport arrivals to Foreign Investment Interestinterest. High-end buyers looked for Palma de Mallorca airport. By the end ofthe best deals in key areas of the island, 2012, over 22.6 million passengers hadparticularly in Palma de Mallorca’s Old Throughout 2012, Mallorca properties arrived at Palma de Mallorca airport saw an increased level of interest amongst visitors to the Lucas Fox website. In 2012, .the majority of Mallorca buyers came from the Scandinavian countries, Germany, UK, Switzerland, The Netherlands, France, and Russia. This trend is expected to continue into 2013, as economically strong countries with high levels of wealth look to Mallorca and Ibiza when buying properties. Mallorca Average Property Sales Prices Q3 2010 – Q2 2012 / Source: Idealista.com International Visitors to Lucas Fox Mallorca Average Rental Sales Prices Q1 2011 – Q4 2012 webpages for Ibiza property 2012 Source: Fotocasa.es, Idealista.com Source: Google Analytics for Lucas Fox website MALLORCA REAL ESTATE MARKET Q3 & Q4 2012 www.lucasfox.com
  • 3. Lucas Fox Analysis and Predictions for 2013 ABOUT THE LUCAS FOX MARKET REPORTS“World-class golf courses, leisure activities like yachting and boating, and You can keep receiving up-to-dateample opportunities to soak up the island’s natural wilderness and seafront market reports from the Lucasvistas are making Mallorca top of the list for many international luxury Fox International Properties team.property buyers who want to combine lifestyle demands with long-termproperty values,” says Lucas Fox Sales Director, Rafael Calparsoro. Subscribe to future updates at our website or bookmark our blog for“Sea front villas and apartments in the Old Town area of Palma de Mallorca the latest news on the Barcelona realwill continue to see high demand as we enter into 2013,” says Rafael estate market.Calparsoro, Lucas Fox Director of Sales for Mallorca. “2012 saw an increasein interest in sea front properties in classic developments across the island,including in Bendinat, Sol de Mallorca and Costa de los Pinos and we expectsome brisk trading in these areas as high-end buyers are keeping an eye onavailable property as it comes to market.“2013 has every indication of being a better year for the Mallorca propertymarket”, Mr Calparsoro says. “While 2012 definitely saw Mallorca reach anew level of recognition amongst international luxury property investors, weexpect 2013 to maintain this status and global reputation as word spreads Alex Vaughan Rafael Calpalsoroeven further amongst new buyers who will be keen to share their experiences Director Lucas Fox Sales Director Lucas Fox Mallorcaof acquiring a property in this most beautiful and well-preserved of luxuryholiday destinations.” WWW.LUCASFOX.COM COUNTRY HOUSE HOUSE / VILLA HOUSE / VILLA LOCATION: LOCATION: LOCATION: SPAIN » BARCELONA » CENTRAL MALLORCA SPAIN »MALLORCA » PALMA SPAIN » MALLORCA » EAST MALLORCA LFMA434 PRICE ON REQUEST LFMA421 450.000€ LFMA426 5.900.000€ COUNTRY HOUSE COUNTRY HOUSE LOCATION: LOCATION: SPAIN » MALLORCA » NORTH MALLORCA SPAIN »MALLORCA » PALMA LFMA370 2.200.000€ LFMA374 1.950.000€ MALLORCA REAL ESTATE MARKET Q3 & Q4 2012 www.lucasfox.com

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