Crisis in the Balearics as property prices skyrocket - 80% increase in 10 years

Property prices in the Balearics continue to soar, according to an analysis of data released by the Ministry of Housing and Urban Agenda. Property values across the islands have risen sharply and steadily in recent years, making homes significantly more expensive than they were 10 years ago. In the second quarter of this year, the average appraised value of homes in the Balearic Islands reached around £2,960 per square metre, up 13% in the past year and 22% over the last two years. Compared with 2015, prices have climbed by more than 80% in just a decade.

The report has also shown that the number of non-primary residences rose again in 2024 after falling sharply between 2022 and 2023. In 2024, of those more than 660,000 homes in the Balearics, 212,309 were not primary residences, 32% of the total.

According to the real estate platform idealista, it is British buyers who are driving the renewed rise in second homes across Spain. UK nationals remain the largest group of foreign property purchasers, buying 5,731 homes in the first half of 2025 - around 8.1% of all transactions by non-Spaniards.

However, the rising prices also turn off foreign property buyers. According to Majorca Daily Bulletin, from January to June, there were 2,816 sales to foreign buyers, a fall of almost seven per cent compared with the first six months of 2024.

Second-quarter figures from the College of Registrars showed a 1.6% year-on-year fall in the sale of homes to foreign buyers, confirming a trend that has been evident since 2023.

Daniel Arenas, the president of the ABINI association of national and international real estate agents, said this is "an adjustment" to both high prices and limited supply.

Elsewhere in Spain, however, sales to foreigners rose by up to 30%, as in Asturias.

This follows bars and restaurants in the Balearic Islands experiencing the steepest decline in trade of any Spanish region during the 2025 tourist season. The Restaurant Results - Summer 2025 report by Delectatech identifies a clear connection between reduced customer numbers and a continued increase in prices. Many restaurant owners in Majorca have reported weaker takings since last summer, blaming the slowdown on tourists cutting back their spending.