Latest figures from valuation company Tinsa shows a 3.3% increase in prices for Canary Islands and Balearic Islands compared to a negative 10.5% for the rest of Spain for the month of April.Managing Director of Balearics Sotheby’s International Realty, Daniel Chavarria Waschke says, “This is consistent with the market predictions we posted in January this year when we stated that we had started 2013 with a real sense of positivity.
“We made reference to the fact that Ibiza had its recovery in 2012, way ahead of the mainland, and was already ‘booming out’ again. Meanwhile we said that demand for holiday homes in Mallorca had remained high throughout the ‘crisis’ largely due to the mix of nationalities involved, with more than 80 per cent of buyers non-Spanish.
We believed that at the top end, the worst was over for Mallorca and recovery would accelerate in 2013. Our crystal ball appears to be spot on with April’s 3.3 per cent house price increase reflecting that recovery. Long may it continue.”
Since 2007 Spain has experienced overall house price falling by 37.2 per cent from peak values.
The mainland Mediterranean coastline is home to the highest falls at 45.1 per cent and the capital.
By contrast the Canary & Balearic Islands experienced just 24.5 per cent from the peak, with a positive turnaround now very much in evidence.
Accounting for this increase in sale, British buyers still bought more properties than other nationalities with 4,148 purchases - 16.63% of the total bought by foreigners and 1.35% of the total number of properties bought including Spanish buyers.
British buyers bought 4,148 properties in 2012 and only to compare 4,007 in 2011.
The amount of properties bought by foreigners as a percentage of the total number of property transactions is on the increase and matches 2006 and 2007 levels.
Market recovery may well be accelerated by Mariano Rajoy’s , the Prime Minister statement that wants to offer indefinite residency to foreigners purchasing a home priced in excess of €500,000, much higher than in the suggestion from November 2012 which was the €160,000.
At the moment this is only a proposal - a more details are expected for the summer - but there was already a strong interest from different, big countries like China and Russia, nations keen to access one of Spain’s millions of empty properties in return for profitable residence.
This €500,000 threshold plays into Sotheby’s International Realty’s hands as in Mallorca the company focuses on prestigious villas priced above two million euros and apartments above €500,000, while in Ibiza for example, the bar is set at villas above one and a half million euros and apartments more than one million.
For EU resident buyers however Fuerteventura is currently the best investment where 4 bedroom villas on large plots with private pools are being sold from less than 300,000 euros.
