Palma.—The President of the Association of Building Promoters in the Balearics, Josep Oliver - pictured, left - said yesterday that if the unsold stock of housing does in fact go down to 1'000 properties next year, this will mean that the balance of unsold stock in the region will have become “completely normal”.

There is, he said, always a nucleus of housing that becomes very difficult to sell, either because of out of the way or undesirable locations, unpopular design or particularly high prices. “We could say that the building business in the Balearics which at the start of 2008 had the task of evening out the supply and demand of housing stock, will have fulfilled its commitment by the time 2012 comes round,” said Oliver.

Once this task has been completed, he added, promoters can then start to galvanise the regional economy by beginning new projects and creating employment.

Specific difficulties
However, the building community is currently faced with two problems.
The first is financial, because until the banking world decides to lend builders the money to put properties up in the first place, and until purchasers are able to be given home loans “it's impossible for the market to kick start itself,” alleged Oliver.

He went on to lament the fact that the slow wheels of government bureaucracy have moved very slowly all through the 4-year term of office of the outgoing Socialist government. Ever since the construction world came to a standstill, said Oliver, getting a permit to build has been a major sticking point. There are, Oliver insisted, constructors with available land in urban environments who just can't get going because it takes months to get hold of local authority permits.

Oliver calculated that what he described as a “stagnation of paperwork” is responsible for as much as 40 percent of the freeze in the construction industry.

This means, he said, that even when the housing stock has “normalised” itself next year, even if builders have the money for new projects, they're going to find themselves stymied without licenses. This, he warned may mean that a housing shortage could develop if projects can't get underway. “We very much hope that the new Balearic government will move to shift the bureaucratic deadlock,” said Oliver.
The Housing Stock Fair, selling remnants of new home developments, will take place in the Parc de les Estacions, behind Palma Central Station in Plaza España from 15-18 June.

Reductions of 15 to 20 percent will mean that discounted properties will be selling at between 150'000 and 300'000 euros. Housing remains most expensive in the Balearics in Palma.