mallorca market 2012
DESCRIPTION
The First Mallorca Market Report - 2012TRANSCRIPT
Mallorca still of the list for German purchasers.As strange or inappropriate as it might read, the present financial situation
in which Europe and particularly Spain is wrestling with - is one side of the
coin. On the other side, the more positive side and relating to the property
market in Mallorca, is unquestionably the lure of the sun and
Mediterranean lifestyle. Secondly, we are hearing an old adage our
parents would have quoted on several occasions during their lifetime -"as
safe as bricks and mortar".
Therefore with that thought in mind it has added a third dimension to
purchasing property in Mallorca. That extra consideration is placing one's
cash into the safe haven of something physical, something you control,
can enjoy or rent. In addition to First Mallorca's very active long term
rental division, the company is offering `buy to let´ relating to new deluxe
properties in Puerto de Andratx producing a return of up to 4.3% at prices
starting from 375,000 € for a 120 m2 2 bedroom 2 bathroom apartment
with garage and superb community facilities; see reference 52832.Of late
the most asked question of course refers to the health of the Mallorca
property investment.Clearly the most relevant fact to understand is that
one must not confuse the property market of mainland Spain to the
situation of Mallorca. It is related only by being under the umbrella of
association.
Nationalities of Purchasers42 % German
16 % British14 % Swedish10 % Swiss6 % Russian4 % Spanish
2 % Austrian2 % Czech2 % Danish2 % Luxembourg
N A T I O N A L I T I E S O F VENDORS34 % Spanish26 % German22 % British
4 % Swedish2 % Austrian2 % Brazilian2 % Danish
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Mallorca is un individual product.And has never been building developments in excess of demand. Mainland Spain on the other hand
constructed massive blocks of characterless apartments along its coastline, relying on unsecured bank loans
based on pure speculation rather than intelligent market research. Even during the 2005-08 construction
period the old 'hard sell' philosophy and lack of pleasing architecture was wearing thin. In many cases the
property purchase agent quoted a monthly mortgage rate rather than the selling price. For several
considerations that development policy was seriously flawed (we wrote about it as long ago as 2006). The
mismanagement of many Spanish banks' mortgage departments is
now well documented. However, prior and therefore unrelated to these
Government incentives, the period following the 2011 Christmas
holiday First Mallorca enjoyed both a record number of daily website
visits and an increased number of enquiries compared to the previous
year. As a result property viewings showed increased activity and have
continued at a very satisfactory pace to date.
Clearly the lure of the warm Mediterranean sun and lifestyle is not to
be underestimated even in a depressed European economy. Our
results from january 1st January to 31 May 2012:
PROPERTY SALES
Value of Property Transactions: 42,983,370 €Number of Sales: 50Average Property Price: 859,667 €Average Negotiation Margin: 11.49 %Most Valuable Property Sold: 4,200,000 €Most Affordable Property Sold: 80,000 €
To stimulate the market, the
Spanish Government has
i n t r o d u c e d t w o t a x
incent ives. Appl icab le to
p u r c h a s e s d u r i n g t h e
remainder of 2012 the Capital
Gains Tax when re-selling will
b e s u b j e c t t o a 5 0 %
reduction. No date limit on
when the property is sold. In
a d d i t i o n , t h e V A T o n
purchases of new properties
is currently reduced to 4%
from the original 8%.
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