Sharp fall in Balearic home sales in 2011

Last year, there were 8'112 registered home sales in the Islands compared to 9'784 the previous year, a downturn of 17 percent. If the year-on-year decline is worrying said a government spokesman yesterday, even more so is the comparison of 2011 sales with those in 2007 when 20'498 homes had been sold. The decline over four years, he said is 60.43 percent and there is apparently little distinction between sales of new or second hand housing. The only sector which has escaped the gloom is in subsidised housing where 413 homes were sold in the Balearics last year compared to the 362 registered in 2010.

The Balearic government meanwhile does not believe that the market is going to improve during the current economic climate and confirmed that it expects 78 million euros less in taxes on house sales this year. The regional government Vice-President and Finance Minister, Josep Ignasi Aguiló explained that the decline in the housing market has direct consequences for the Balearic treasury. Tax on the sale of property is one of the most important sources of revenue for the Balearic government. Aguiló said that he saw no sign of the housing market improving in the near future. “All of us are living at a time of crisis and debt whether it be families, businesses or local government - the only way we are going to get out of the crisis is to get ourselves out of debt,” said the Minister.