For years, a group of expats has quietly reaped the converse benefits of all the bad press generated by cheap package tour deals attracting bare-chested Brits plying themselves with alcohol night after night in Magalluf: it put many people off from discovering their side of Mallorca. But thanks to the efforts by the Mallorcan Tourist Board, as well as initiatives from the local government to prevent the further building of any cheap-and-nasty hotels or apartment blocks, the tide has turned. And, recently, it’s been something of a challenge to open a Sunday travel supplement without finding someone eulogising about the charm and sophistication of the island.
The introduction of the Euro took its toll on the island’s property market, first by provoking a certain amount of building in the months coming up to 2001, and secondly, by opening up avenues so that a tax collector of one country could converse easily with his equivalent in another. The result lead to a decrease of interest from the traditionally strong German market?although that has recovered ?and, more recently, it has also empowered Spanish buyers to match prices which, with pesetas, they could rarely reach. A report by Khun & Partner in January this year cites Tinsa Consultants’ figures that from 1999 to 2005, the value of property grew by a not inconsiderable 215%.
Jane Salthouse of Vogue Properties (00 34 971 532 984), a boutique outfit which represents Knight Frank in the fashionable northern town of Pollensa, says that recently her clients have included a fair number of mainland Spaniards looking for second homes on the island. ‘We’ve had an increasing number of enquiries from Spanish families who are looking to buy fincas, both to act as a second home as well as for a rental investment. We think we’ve got a really strong year ahead.’
Another reason why the north of the island is going to be a hot spot in 2006 is the extension of the motorway from Palma. Until now, anyone heading north had to be prepared for a good hour-long journey (to the islanders, this is the equivalent of London to Edinburgh). Now, motorists can bypass the industrial town of Inca (only really worth visiting for the Camper factory outlet based there), and they have a clear dual carriageway run up to the north coast. ‘Now, even local families, who once were forced to buy in and around Palma, because that’s where the best schools are, are looking to move north.’
Pollensa has traditionally attracted the top-end British market. ‘The types,’ expands Jane, ‘who live most of the year in the spotlight in London, but who have bought here because they can drive around in a clapped-out banger and disappear up the dirt track which leads to their house, where there is complete privacy.’
Kühn & Partner (00 34 971 228 020), one of the island’s most well-established estate agents, believes that the island is a sure-fire bet on return of investment wherever you’re buying. The improving state of the German economy is already having a corollary effect on the buoyancy of the Mallorcan property market, creating a higher demand. ‘We believe that as a direct result of the restrictions on areas for new development, prices will continue to increase.’ The lure of the island hasn’t escaped the notice of the Russians either: the well-heeled chequebooks of the Eastern Europeans are now beginning to play a larger part in the property market.
But they cite the interest from British buyers as being on a steep increase over the past two years. ‘Currently, about 60% of interest in our properties is generated by the British market. Two years ago, that figure would have been roughly 40%,’ says Tom Hesse of Kuhn & Partners. ‘But in both the German and the British market, we at K&P are seeing clients buying fewer properties at higher prices.’
Where to buy
Es Pla (the central plain district) at the foothills of the Tramuntana mountains is popular with buyers who intend on spending more than just a couple of weeks on the island. The picturesque villages of Santa María, Sineu and Alaró are surrounded by large country houses which often come with larger plots of land, although the sacrifice is the fact that the coast is that much farther away (this could also be a blessing, of course, if sun, sand and sea aren’t on the menu). Fincas range from about ?700,000 to ?10 million.
The Mountains They’ve long been the haunt of art, music and literature stars (the Hay on Wye festival recently hosted a Mallorcan equivalent in Deia) and British buyers dominate the market for property in and around the mountain towns. Houses with a sea view can cost well in excess of ?2.4 million and some of the island’s most sought-after properties are the 19th- and early-20th-century mansions which are scattered throughout the mountain villages. The port of Sòller is being restructured which, according to K&P, will lead to ‘a considerable enhancement of price and value’.
The South-East Worth watching in terms of investment property growth are the relatively unexplored towns and villages of the south-eastern corner of Mallorca. Prized for its long sandy beach at Es Trenc and covered with windmills and almond trees, this picturesque region will benefit from another new motorway which heads east out of Palma. Rustic fincas are currently priced from ?650,000 to ?4.5 million.
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