Foreigners are buying up property when they come to Mallorca on holiday, according to Real Estate Agents.
“German clients have started to come and they’re already buying property and the British will be able to start moving shortly and they’ll do the same,” predicts Hans Lenz, Director of Engel & Völkers Southwest Mallorca and President of the Balearic Association of National and International Real Estate Companies, or ABINI. “We are very busy. Many people want to buy a home now so that they can enjoy it this summer and they’re looking in the city, on the coast, in the Part Forana, for farms, villas, flats, everything,” he adds. “The lockdown appears to have heightened people’s desire to come to Mallorca and made them rethink many things in life. The British and Germans couldn’t travel in winter and now they want to enjoy the sun.”
Lenz points out that neither Germany or Great Britain has suffered in such a severe way from the economic crisis caused by Covid-19.
“They are highly industrialised and don’t depend so much on tourism, so their budgets haven’t suffered when it comes to buying a new property. Confinement has allowed them to save more, and that’s encouraging them to buy a new home,” says Lenz. “These investments will be of a great help to the Mallorcan economy, the rentals and sales will generate capital movement and if buyers decide to build or reform a property on the island, they’ll be creating jobs and spending money.”
Lenz also warns that even although Mallorca is going through an economic crisis due to the pandemic, prices are not rock bottom.
“There are no bargains,” he says. “In quality second home areas, prices have not suffered and we will have to see what happens in other more areas, but prices are not going down. We are not facing a financial crisis, we’re in a pandemic and there is a lot of money circulating.”
Natalia Bueno, President of the Balearic Association of Real Estate Agents, agrees with Lenz.
“According to the INE, up until Q4 of 2020 the number of sales to foreigners was reduced, but they sold for a higher amount. New technologies help to sell property at a distance but the sale does not materialise until they physically come here, so the travel restrictions don't help,” says Bueno. “Last week I was at a notary in Inca and they told me that they already have as many protocol numbers as they had in the whole of last year for first home purchases and investments, so we’ll see what data the INE gives us for Q1 of this year.”
British people are allowed to travel to Spain for business reasons but not for holidays.
"Visiting the island to acquire a property or sign a contract is a legitimate reason for travel," says Lenz.
Those who breach the restrictions and come to the Balearic Islands for a holiday could be fined £5,000.