Happy new year for property market

By Humphrey Carter THIS year is going to be another healthy year for the Majorcan real estate sector with the British boom forecast to continue. This week, international real estate company Kühn & Partner published its market report for 2006 and concludes that Majorca is a “first class” location for real estate investment, “especially for sophisticated buyers, sellers and investors from all over Europe who seek exclusive real estate in a secure and stable environment.” Last year was a very significant one for the island, and exceeded all projections and indications of all experts. It has been shown that German investors, as a result of the improving economy, created a higher demand, while British clients, as a result of the strength of the British currency, gained considerable purchasing power in the last year and this trend, according to the report, is set to continue during 2006 despite the Balearics being the fourth most expensive property market in Spain, according to the central government figures released yesterday. Kühn & Partner maintains that the island's climate, high living standards, easy access and wide range of cultural, sporting and entertainment facilties, not only makes Majorca a hugely attractive location to set up either a permanent or holiday home but, because of the steady increase in property values, is a prime investment location. The value of Real Estate has increased significantly in recent years, and according to the Savings & Trust Organization, real estate grew by 118% from 1999 to 2000. According to the survey published by Tinsa Consultants, specialists in real estate appraisals, during the period from 1999 to 2005 the value of real estate grew by 215 %. Also, the value of re-sale apartments experienced a 16% growth. The increase in price for 2005 was between 12 and 15 %, with additional positive growth and development in the next years being projected by experts in the real estate sector. The real estate portal Expocasa estimates the most expensive property to be located in Marbella, Spain, with an estimated net worth of 15 million Euros, while the most expensive on the Balearic islands is located in Pollensa, with an estimated worth of 5 million Euros. However, Matthias Kühn sees an upper limit higher than 20 million Euros in the Balearics, such as a residence on the hills of Las Brisas, which is valued at 25 million Euros. What is more, it is believed that, as a direct result of continuing restrictions on new developments, property prices will only be pushed up further. But while the resurgent Germans and the cash-rich British are continuing to dominate and steer the market, increased interest in the top end of the Majorcan property market is being shown from mainland Spain, Sweden, Holland, France and Italy. Majorca has also caught the eye of Russian holiday home hunters and investors and property prices will only surge further once Majorca firmly establishes itself as a market leader, as it has in Britain and Germany, in the new emerging satellite markets.