Property in Majorca and the Balearics attracting plenty of foreign interest. | Javier Coll

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According to figures from the national ministry for economic affairs, the sale of properties at the upper end of the Balearic housing market has risen by 57% since the start of the year and has represented a total value of 62 million euros.

Luis Martí, president of the Balearic association of developers, says that at present the only part of the market that is operating well is the one for detached properties from 350,000 euros up to several million. "It is a market that is rising and will continue to this year."

Martí adds that it is this favourable upper-end situation that is impacting the development of lower-end apartments. Licences to build, he notes, are practically non-existent. "Anecdotally, it's enough to say that over the past six months in Palma there have been four licences granted for apartments. Developers are more interested in the foreign market."

José Luis Roses of the Majorcan Chamber of Commerce observes that it is the foreign market as well as hoteliers and tour operators who are driving real-estate investment, the latter acquiring establishments in order to guarantee places for the next three years. He notes that improved airline services from Scandinavia and Central Europe are also having a positive impact on Majorca's real estate.

Martí, though, believes that town halls need to get rid of bureaucratic obstacles that are in fact crippling many projects and having a negative effect on the construction industry. He also notes that there has been a slowing of interest by the British market because of concerns over the referendum. "There is uncertainty as to what will happen; even more so if there were to be euro-sterling parity." However, if the vote is to remain, he expects that the market will revert to being normal.