Why Mallorca, Why Luxury?
Mallorca has always attracted wealth. For hundreds of years, the island has been a favourite of the elite, especially European royalty. Today, it remains a magnet for the Spanish Royal Family, as well as contemporary business and entertainment leaders such as Michelle Obama, Brad Pitt, Michael Douglas, Claudia Schiffer, Sir Richard Branson, Bob Geldof, Christian Candy, and Sir Andrew Lloyd Webber. Luxury property makes up about half the property on Mallorca and 80% of new builds are luxury, according to a 2019 study by The STI Centre for Real Estate Studies.
This may be because Mallorca is renowned for its low-key lifestyle, where the rich and famous mingle casually with locals and privacy is respected. Or it may be because luxury property in Mallorca is a superb investment. The island has offered some of the best property returns in the world over the past ten years, with price increases almost four-fold, and forecasts of 6% year on year growth for at least the next four years. In some prime areas, prices have increased 20% in just the past 12 months.
Thanks to this beguiling combination of investment, lifestyle and seclusion, Mallorca is becoming more of haven for global wealth than ever before. All this has raised the ceiling on property prices. While property prices have climbed steadily for a decade, the market has tended to top out in the tens of millions. No longer.
Over the last two years in Mallorca we’ve seen a developing trend for spectacular Super Prime villas coming in above €20M. There are well over a dozen properties available at the moment for over €20M, and we expect the quantity of properties in Mallorca sold over €20M to double over the next two years. This is down to both Super Prime properties seeing gains of 100%+ , as properties that might have been available for around €10M a decade ago are now on the market for twice that, as well as lavish new builds coming onto the market.
Where to Buy, What to Buy
Valuing property can be difficult in Mallorca because there are so few direct comparables. There is huge diversity and almost every Super Prime Property is unique. Over time, after viewing many hundreds of properties, one develops an instinct for pricing on the island, but it is difficult for foreign vendors and buyers. That’s one reason it’s critical for buyers to have local representation.
However, a few things to keep in mind: The West and Southwest of the island have the highest concentration of Super Prime properties.
Sea views increase values by 50-60%, while a striking luxury pool increases values by up to 40%. And key areas add enormous value. This is down to amenities in the area, proximity to the airport, and the quality of the community.
Port Andratx – Property values in this area are the highest in the Balearics and some of the highest in Spain. A good plot can cost up to €6 million, with substantial houses selling north of €30 million. Port Andratx is the true jewel of the Mediterranean and is sometimes called the Miami of Europe, attracting a bohemian mix of celebrities, media-types, visitors and working fishermen. The major attraction of Port Andratx is its beautiful beach and mountain setting.
Son Vida – Son Vida is an exclusive residential area close the historic city of Palma. Its manicured golf courses, famous hotels, and jaw-dropping villas are a draw for celebrities and royals, as are its amazing views of the mountains, and the Bay of Palma. Many of the Super Prime €20 million+ villas are located here.
Deia – The small coastal village of Deia, on the northwest coast of Mallorca, is one of the prettiest villages on the island. Perched in a ravine at the foot of the Teix mountain, with views out to sea, Deia has always attracted writers and artists. It continues to be a melting pot of art and culture, appealing to a sophisticated owners and residents who appreciate serene mornings and flawless sunsets. Although it attracts many visitors during the day, at night the intimate nature of this small town comes to life as residents and locals from all walks of life gather to listen to live music and enjoy the privacy of this remarkable alpine-like community. There are deals to be had here, with townhouses starting at €600,000, but a large private villa will cost upwards of €10 million.
About The Author
Richard Heaney founded Elan Palma Property almost a decade ago, when he moved to live full time on Mallorca. Richard is the only UK-style buying agent on the island, representing the buyer at no additional cost to the buyer. He specialises in luxury properties and high-profile clients who appreciate efficiency and discretion. Richard Heaney is an opinion columnist for a number of international business and investment publications.
