In nationwide comparison the Balearics take first place in Spain with forecast economic growth of 3.3% for 2015 according to Rafael Doménech, Chief Economist for Spain and Europe with BBVA. For the islands, tourism is the primary economic driver. During Q1 2015 the total number of visitors rose by 7.17%, an increase of 495,000 tourists in year-on-year comparison (source: AENA/EFE). The real estate industry also benefits from this rise.
According to Spain’s National Statistics Institute, INE, 3,246 properties were sold in the Balearics during the first four months of the year. Thus although the quarterly figures were slightly down (-1%) in year-on-year comparison, the overall trend is pointing upward: in April, sales figures rose by around 4% compared with 2014.
According to the Spanish Ministry of Public Works and Transport (Ministerio de Fomento), around one in three properties sold in the Balearics was bought by a foreigner in 2014. Last year total foreign investment amounted to 976 million euros, representing an increase of over 100% within the last five years.
Joachim Semrau, CEO of the Porta Mondial Group, can confirm that there is great demand from abroad across the entire network, with Majorca currently being particularly popular with investors.
“Around half of Porta Mallorquina’s clients come from Germany, Austria and Switzerland, followed by the British and Scandinavians.”
Buyers are increasingly focusing on income properties which can be used for lucrative holiday rentals. In some cases, holiday homes in attractive locations in Majorca achieve gross returns of over 5%.