Developers of recently completed luxury property projects in Mallorca are so desperate to sell and move on that they have made huge price reductions to tempt real estate investors back to the popular Spanish island, it is claimed.
Property price reductions and the opportunity to negotiate deals could tempt back foreign investors, according to Jan Pratt of Shortcut Property Search which specialises in real estate in Mallorca, Barcelona and the Costa Brava.
‘Developers are prepared to negotiate more than ever before and buyers who previously considered the island to be too expensive for them are now more able to purchase in the best locations,’ she claimed.
She explained that there is an increasing shortage of building land available in the best coastal locations putting pressure on supply and so the remaining apartments in completed developments and those nearing completion are very attractive. ‘The market is showing signs of bottoming out and prices are as low as they ever have been over the last five years,’ said Pratt.
She has one client who postponed buying on the island three years ago as it was out of her price range but has now returned and is buying a top quality apartment overlooking the sea in Puerto Andratx.
‘She plans on using it herself and renting it out until the market returns to full strength and there is a lack of supply, at which point she knows she will be sitting pretty with a high quality apartment which has increased in price,’ she said.
She predicts that demand for property in the south west of Mallorca will undoubtedly increase as buyers return to the market, but unlike mainland Spain availability of new build could quickly become an issue.
‘With limited supply, the best quality developments will become more sought after and prices could rise quite rapidly. Those looking for a good investment can be confident of a good return as this situation favours those buyers returning early,’ she added.
Prices on Mallorca, Spain’s largest island that is popular with celebrities, have dropped around 4% since their peak with many agents now claiming they are bottoming out. According to Malaga based Spanish Hot Properties villas on Mallorca are still proving popular.