The number of foreigners calling the Balearic Islands home rose dramatically last year, with reports that Majorca was one of the safest areas in invest in due to a balanced supply and demand situation – but now, Majorca is suffering huge drops in house sales, with the number of British buyers falling by 50 per cent…
Long a favourite with the rich and famous, Majorca is traditionally the most popular of the Balearic Islands.
Stunning coastlines and months of mellow sunshine provide the perfect backdrop to its role as the super yacht hub of the western Mediterranean. The true jewel in the crown is the capital city of Palma which offers a far more cosmopolitan and cultural twist that most holiday hotpots.
The other Balearic Islands, namely Minorca, Ibiza and Formentera, are also popular with holidaymakers and investors and, according to Spain’s National Statistics Institute, the number of foreigners living in the Balearics rose by a whopping 17.2 per cent last year.
More than 32,000 foreigners arrived to set up home on one of the islands last year, with Germans heading up the exodus. German nationals now account for the largest single group of immigrants to the Balearics, swiftly followed by Brits, Moroccans and Italian citizens.
Majorca’s stunning capital city of Palma is the most populous town, followed by Calvia, where over 33 per cent of residents are foreign. Ibiza Town came in third place with 11,604 foreigners, or almost a quarter of its inhabitants.
But, local estate agent Engel & Völkers, which specialize in selling luxury properties in Majorca, said that Majorca endured one of the most challenging financial quarters at the end of last year.
According to the Engel & Völkers report, sales fell by 30 and 35 per cent in the last few months of 2008, compared to the same period in 2007.
British buyers have dropped by 50 per cent and the main buyers at present are German, Scandinavian, Swiss and Spanish.
The only area which has proved to be the exception is the southeast of Majorca which has had its best year yet. Twenty minutes from Palma airport is the exclusive town of Puerto de Andraitx which has the reputation of being the ‘prettiest harbour in the Mediterranean.’
Celebrities flock to this area, which boasts some of the most expensive property in Majorca. As super rich celebrities aren’t so concerned by the credit crunch, this area has bucked the trend and sales have remained stable or even increased.
As the island has a balanced supply and demand situation, which is driven by strict controls on new development, easy access and a sophisticated infrastructure, sales on the island look set to level out.
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