Balearic high end property prices on par with those in London
London is known for its high property prices with wealthy international buyers pushing up values but now figures suggest that parts of Spain that are popular with rich overseas buyers are matching the UK’s capital city.
The average price per square metre of property sold by Mallorca and Ibiza Sotheby’s International Realty this year is €9,000 or £7,600 pounds which the firm believes puts the Spanish islands into the same price bracket as certain parts of London.
According to September research from Savills, prime property in south west London is valued between £510 and £990 per square foot which equates to £5,490 and £10,656 per square metre and for the east of the city between £500 and £790 per square foot or £5,382 and £8,503 per square metre.
High prices in London are being blamed on strong overseas demand and it’s no different in the Balearics. ‘Due to ease of access from most northern European cities, more than 80% of our buyers are not Spanish,’ said Daniel Chavarria Waschke, managing director of Balearics Sotheby’s International Realty.
‘Looking at the year to date, half of all our enquiries are from British and Germans buyers, 34% and 21% respectively for Mallorca and 40% and 10% for Ibiza. They are placing high value on location alongside quality of construction, a considered layout and a superior level of decor. Tastes are more refined and budgets seemingly limitless, but supply is relatively low, hence the surprisingly high property values we’re now experiencing on the Islands,’ he explained.
‘Whilst the assumption may be that it’s Russian or Middle Eastern buyers who have been spending an average of €9,000 a square metre on property with us this year, that’s not the case. In fact two thirds of our purchasers have been British, with German, Swedish and the occasional Far Eastern buyer making up the minority third,’ he pointed out.
‘British certainly feature very strongly in 2013. Whether the balance will switch further afield to China, Hong Kong and Russia when Spain’s new golden visa legislation takes affect remains to be seen,’ he added.
Balearics Sotheby’s International Realty has also observed that all homes they’ve sold in 2013 have been under construction, recently completed or freshly refurbished. Those that require modernisation have tended to stick on the market a little longer.
Also the effects of the economic crisis are no longer being felt in the Balearic property market, people are no longer hesitating or negotiating, and the trend is for bigger, better and more expensive villas.
To adapt to this trend, the high end real estate agent has raised the minimum price of apartments listed within its portfolio to one million euros and villas to two million euros. The aim is to match supply to demand and accommodate the tastes and preferences of its exclusive clientele.
Indeed, Balearics Sotheby’s International Realty now lists 22 properties priced in excess of 10 million euros on its website, with a further 10 marketed in a more discreet manner. This number is set to double in the next three years and prices could also rise by up to 50%.