The luxury end of the market doesn't compete with resident housing needs. | Archive

Juan Pedro Yllanes, the Balearic government vice-president, has praised the Canadian government's two-year ban on purchases of properties by most foreigner buyers. It is an initiative, he says, that is likely to be discussed at this Monday's cabinet meeting.

A ban on selling homes to non-residents "would be a definitive step to start solving the housing problem". Canada, in his opinion, offers an "example to follow" and he points out that, despite the legal complexity, there are precedents in the European Union that relate to limitations on purchases in island territories.

For the ABINI association of national and international real estate agents in the Balearics, statements by Yllanes are unwelcome. Its president, Hans Lenz, the director of Engel & Völkers in Mallorca, says that "to praise actions like that of Canada, the effects of which have not yet been analysed, is very risky".

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He adds that "aggressive" interventions in the housing market - as with limitation of rental prices in Berlin - have had serious legal consequences as they have ended up being declared contrary to the law. "Experts have warned that limiting purchases to foreigners will not generate more housing for the resident population." In any event, he notes, "the purchase by non-residents, now the boom caused by the pandemic has ended, is in clear regression".

As far as Hans Lenz is concerned, "this government and the municipalities would do better to accept the suggestions that come from the sector and urgently activate an energetic affordable housing plan that really works: there are many examples at the international level". He is referring in particular to the lack of land and to regulations that prevent growth in height of buildings. These are the true causes of the housing problem in the Balearics.

The ABINI, founded in 2020, lists on its website a limited number of members. As well as Engel & Völkers, these include Berkshire Hathaway Home Services and Sotheby's International Realty.