Mallorca’s Property Prices Hit Record Highs – What You Need to Know

The average price of housing in Spain has reached a new all-time high, surpassing the previous peak from 2007. In Q4 2024, the average price per square meter hit 2,164 euros, which is 12.5% higher than the last peak before the financial crisis. Compared to the previous quarter, prices increased by 2.4%.

What’s Happening in the Balearic Market?

The Balearic Islands remain one of the most expensive real estate markets in Spain. According to the latest data from the College of Registrars, the average price in the Balearic Islands reached 3,496 €/m² in Q4 2023.

By Q3 2024, that number had climbed to 3,644 €/m², marking a 3.1% increase from the previous quarter and an 8.9% increase year-over-year.

Why Are Prices Still Rising?

Several factors explain the steady increase in property values, especially in Mallorca:

-Limited housing supply – Strict urban planning and a lack of available land for new development keep supply low. -Strong demand from both local and international buyers – Many foreign investors, particularly from the UK and Germany, continue to buy properties in Mallorca. -The island’s appeal as a luxury destination – The combination of a strong tourism sector and a high quality of life makes Mallorca a desirable place to own property.

Who’s Buying?

Foreign investors continue to play a major role in the market. In 2024, 14.5% of all home purchases in Spain were made by non-Spanish buyers. The largest groups of buyers came from:

-The UK (still leading despite Brexit) -Germany -France -The Netherlands

Meanwhile, sales of newly built homes surged by 21.6% over the past year, reflecting strong demand for modern properties.

What About Mortgages?

-435,328 mortgages were registered in the last year, an increase of 13.4%. -Mortgage lending now accounts for 71% of all property purchases, marking the highest level in six quarters.

What Does This Mean for Buyers and Investors?

-Prices in Mallorca are not slowing down – If you’re looking to buy, expect strong competition, especially for well-located properties. -The luxury market remains stable – Many international buyers purchase properties in cash, making price drops unlikely in high-end areas. -Long-term demand is solid – With continued interest from foreign buyers and limited space for new developments, property values in -Mallorca are expected to remain strong.

Final Takeaway

Mallorca remains one of the most desirable and competitive real estate markets in Spain. Whether you're buying a home or investing, staying informed about market trends will help you make smarter decisions.