The president of the API association of estate agents in the Balearics, José Miguel Artieda, says agencies are being forced to close due to a lack of properties to sell. "We are experiencing an unprecedented situation; we have never experienced a supply crisis before."
The most affected are traditional agencies that sell to residents. Artieda explains that agencies typically used to have between 40 and 60 homes for sale. "If they now have between four and eight, it's pretty much a miracle." Given this situation, an option is to amalgamate with other agencies.
And it is a situation, he adds, that is aggravated by unfair competition. "There are individuals without any training, including influencer types who don't even speak Spanish, who are selling homes. People are unaware of the significant risks they take by putting themselves in the hands of those who lack the necessary knowledge."
Artieda is urging politicians to regulate estate agents in order to prevent this. The Balearic Government did regulate, but the Spanish Government challenged this on European competition grounds.
While the traditional agencies are under pressure, Artieda points out that the number of luxury real estate agencies is increasing. These are now from the likes of Dubai and the US, whereas in the past they have primarily been German or British. This is because much of the limited construction is for luxury homes, given how profitable they can be.
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Zoltan TeglasYeah mine was the brother in law of the owner, didn't know how many bedrooms the place had to start, and still wanted 1,400 commission. The industry really needs regulating.
I am selling a house in London and an apartment in Mallorca at the moment; I am paying 1% in the UK and 4% plus IVA in Mallorca agent fees. This article does not surprise me.
When people quit buying, prices will level off or fall. In this case (if there's really any truth to this), then lack of supply will keep prices up. But I'm skeptical about these numbers; "If they now have between four and eight, it's pretty much a miracle." You need only go to any estate agent in any village or town and look in the window at the latest offers shown. There's always at least 8, sometimes 20 or 30. And online at any of the estate agents websites... 8? Don't be silly. 30, 40, 50... And that doesn't include the ones they reserve offline for their best clients to have first shot before putting it online. This whole claim is a bit of a stretch, me thinks.
"There are individuals without any training" The estate agent that sold me my flat was clueless - I had to explain to her the procedure, as she didn't know it. And she worked for a well know agency in Palma. And they want 5% for basically opening the door to the property.
Anther memory moment sparked by the comment about influencers. Back in the 80's 90's my wife sold quite a few properties thank you very much. She did speak Spanish and she did know plenty of locals out here in the country which helped enormously finding places for sale. Back then prices were rising but were still 'reasonable' for many coming from Northern Europe. Over the last ten plus years we have all seen the massive increase in the number of agencies, many from our west european ex friends and trading partners, who have contributed to the unsustainable rise in land and property values here which cannot continue unless there is a second tier market to help keep Mallorquins in Mallorca.
In view of the daily rapidly increasing values of property in Mallorca. I suspect many selling Owners will be holding back from putting their property's on the market. Until they see the price increases level off. These increases are in the hands of the Agents.
What a shame as they are the ones artificially inflating property prices by offering their clients a higher value than the shop next door and so it spirals up out of control.