Engel & Völkers Mallorca reports 217€ million in sales to end July, and a surge in demand by foreign buyers that boosted sales when the borders opened.
At the premium end of the market, Mallorca’s real estate market continues to attract mainly overseas buyers post lockdown. Engel & Völkers Mallorca, with 18 property shops on the island, closed the period January to end July with sales transaction volume of 217 million euros.
Says Florian Hofer, Managing Director, Engel & Völkers Balearic Islands; “Considering the circumstances we are delighted with the sales activity to date. In July when the borders opened, buyers arrived well informed, and were keen to complete their long-term plans. The sales activity in the upper end segment is maintaining market stability and prices are holding in the premium and new construction sector.”
July is traditionally a slow month. However, this year, Engel & Völkers reported a surge of sales of prime real estate in Mallorca when the borders opened on July 1st with a 75% increase over the same month last year. The demand for Mallorca was also witnessed by Palma International Airport that handled 1.1 million passenger movements, more than any other Spanish airport in July.
Engel & Völkers Mallorca brokered a sales transaction per day
Since July, sales were made on a daily basis ranging from 300,000 to 12.9 million euros. Many of the multi-million euro sales were made in the southwest region with increased activity in the 10 million euro bracket. Followed by the Son Vida area, where sales between 2-8 million euros were made.
The majority of buyers are German, Austrian and Swiss followed by some British (particularly at the top end) and French. The lockdown prompted more searching and a high level of requests. In the southeast for example, they received 110% more enquiries in June and 150% more enquiries in July over the same months last year. Enquiries also doubled during June and July in the central and southern region together with the exclusive Son Vida area.
Shift in priorities: privacy, outdoor space/fast broadband/home office/views
There’s been a definite shift in priorities by clients who are considering spending longer periods of time or living permanently on the island. Therefore “must-have” tick boxes include outdoor space, good connectivity, a home office, privacy and views. Clients are now more interested in central heating so that they can use their property year-round and energy-saving features. The demand is still focused on country houses with land together with villas beside the sea with views.
Authentic village lifestyle is now becoming more popular. In the southeast and central Mallorca, there has been growing demand for refurbished traditional townhouses with modern contemporary interiors and a small pool with prices varying between approximately 700,000 to over 1 million euros.
In the capital of Palma there is steady demand for apartments with terraces and outside space either in historic old town buildings or beside the sea along the Paseo Maritimo or around the Portixol harbour district.
Health & Safety
Mallorca offers a high level of security and safety underpinned by a modern and efficient health system with multilingual staff and leading specialists. According to a report published by the Institute of Integration and Health based on the Ministry of Health statistics last year, the Balearics top the ranking of all the Spanish Autonomous Communities with the highest private healthcare spending in Spain with a total of 25 hospitals in the region 11 of which are public and 14 are private.
During lockdown, Engel & Völkers Mallorca focused on creating video and virtual tours to maintain buyer interest. This paid off and in the period of end June until end July, Engel & Völkers had 140,000 hits and 14,000 tours. Some sales were even made on the strength of a virtual viewing with assistance from the sales agents during lockdown.
Increased activity in the rental departments in the southwest, central and north areas have been driven by the fact that many clients want to experience island life before committing to purchase and some want a “bolthole” on their favourite holiday island that is private. Long-term rental business in Palma continues to perform at similar levels to last year with an average rental period of 12 months plus from 1,000 euros per month upwards.
Concludes Hofer: “Our sales results to date indicate that international buyers regard Mallorca as a safe haven to own a second home where they can escape the threat of a lockdown in their country of origin and make a steady long-term investment. The island’s real estate market is underpinned by a unique combination of excellent infrastructure, a modern public and private healthcare system, extensive leisure and sports facilities and international schools that raise Mallorca’s status as a top Mediterranean destination.”