Property prices in Palma de Mallorca

It’s also the capital and largest city of the autonomous community of the Balearic Islands in Spain.

The city’s Old Town is awash with interesting historic sites and brimming with museums, galleries, restaurants and colourful local markets, as well as boasting an eventful calendar of traditional annual festivities.

Located on the south west coast of Mallorca, Palma is the island’s capital and enjoys a warm Mediterranean climate that makes it an ideal place to visit or live all year round. Popular beaches include Illetas, which is just 15 minutes from the city and offers picture-perfect white sand and crystal clear waters. El Mago is a stunning little nudist beach some 25 minutes away from the capital and Cala Blava is a little closer to Palma, a gorgeous white sandy cove situated in the residential development by the same name.

Innovative, creative cuisine meets tradition in the many restaurants in Palma, using the abundant fresh produce from both the sea and the fertile land in the surroundings. Whether grabbing some tapas at a bar or enjoying a fine dining experience in one of Palma’s high-end restaurants, this exciting city has something to suit all tastes and budgets.

Palma boasts four excellent gastronomic markets: Mercat San Juan, which is worth visiting for its incredible period architecture alone, the trendy and relatively new Mercat 1930, Mercat de l’Olivar in the Old Town and Mercat de Santa Catalina, which is best known for the quality of its fish and seafood. To whet one’s appetite for culture, Palma de Mallorca does not disappoint either, with many historic sites such as the Cathedral, the Arab Baths, the Bellver Castle, La Lonja, the Almudaina Palace, the Miró Foundation and the many art galleries, both modern and traditional.

Average property prices in Palma de Mallorca have increased by 7.9%, ending October 2019 on €2,965 per square metre. Hence surpassing the prices in October 2007 by almost 21% when they averaged at €2,452 per square metre. Compared to October 2014 when prices averaged €1,886 per square metre, they have risen by 57%, giving a Compound Annual Growth Rate (CAGR) of 9.5% since then.

The city’s Old Town is awash with interesting historic sites and brimming with museums, galleries, restaurants and colourful local markets, as well as boasting an eventful calendar of traditional annual festivities.

At the end of October 2019 average rental prices in Palma de Mallorca showed an annual increase of 2.6%, rising from €11.7 per square metre to €12 per square metre. Current rental prices are nearly 58% higher than those in October 2014 when they were €7.6 per square metre.

Since October 2014, rental prices and home prices seem to evolve together (57% and 58% increase respectively). Although this seems natural, it’s absolutely not what we see nationally in other cities and regions in Spain.

Indeed, as you can read here in details, rental prices and house prices are moving apart from each other in most regions.

Therefore, the fact that Mallorca’s real estate prices evolve together is a good sign. It shows that the property market is healhier, more stable on the long-run.

The number of sales transactions in Palma de Mallorca in the second quarter of 2019 (1,314 sales) showed a decrease of almost 25% when compared to the number of sales in the second quarter of 2018 (1,748 sales). When compared to the first quarter of the year (1,225 sales), however, the number of sales has increased by 7.3%, and by just over 68% when compared to the number of sales in the second quarter of 2014 (781 sales). The number of transactions has still not yet reached the level of the second quarter of 2007 when 1,912 sales were registered.

Sales of new homes in Palma de Mallorca have increased significantly recently, with transactions in the second quarter of 2019 (138 sales) almost tripling compared to the number of sales in the second quarter of 2018 (49 sales). They currently represent 10.5% of total sales, compared to almost 27% in the second quarter of 2007, around the time of the peak.

Willing to buy or sell a home in Mallorca? Contact our property advisors.