The war of words erupted between developers on the island of Mallorca and the College of Technical Architects (Aparejadores) about what happens to real estate prices in Mallorca, and the prospects for the future.
Not surprisingly, developers, many of whom have large stocks of unsold properties (although not as large as on the mainland), argue that prices will not stop being afraid, no doubt that buyers will sit on their hands, waiting for further falls before committing for any purchase. Official data from the Instituto Nacional de Estadistica (INE) show that prices in Spain fell by 9.2% from April 2009 compared with the same month last year. Tinsa, one of the largest appraisers in Spain, published a similar figure of 10.1%, despite the fact that this figure is 17.1% for the coastal areas of the Mediterranean Sea and 10.4% for the Balearic Islands.
Although these figures do not take into account the fall until April 2008, official data on price movements since entering the upper part of the market do not exceed about 15% and, therefore, compared to what happens in other countries (United Kingdom, United States, Ireland, etc.) D.), where similar price bubbles were found. As we have repeatedly stated, it is much more likely that the statistics in Spain are inaccurate, rather than the fact that Spain suffers less and the decline in prices is less significantly lower.
An unexpected proof that sales have been achieved is that prices are falling much closer to 30-40%, with the largest decline in areas with the most supply problems and low quality. While Mallorca has very significant defensive qualities - a more limited supply of new unsold properties; the story of "exemplary" buyers, not speculative investors; top quality international brand; and a large stock of high-end luxury real estate, we have long argued that the value of real estate in Mallorca fell, despite the fact that in many cases this did not affect prices, many of which remained stubbornly high.
It is refreshing that our professional colleagues, Aparejadores, believe that when sites are bought for future development, it is done so that the values that will allow performing outstanding sales are 30% lower than the “boom” of time. ”They bring land prices from 42,000 euros to 48,000 euros for one dwelling, by small units, compared with 102,000 euros and 108,000 euros at the height of the boom and the beginning of the credit crisis.
Obviously, this will have a direct impact on the values of the properties of the second hand and the values of unsold stocks of new assembly properties. Even if the asking prices are not falling, the reality is that the actual selling prices, especially when mortgage financing is required and where bank valuers come in with much lower numbers, should fall if buyers make deals. The key for buyers is a thorough analysis of the market, if necessary, the search for independent advice on evaluation and negotiation. This is a buyer's market (and yes there are some good buying opportunities), so this is not the one that is above the board, because someone says that property prices in Mallorca "do not really fall"! (each individual case should be judged on its own merits, and some properties will have lower price cuts than others, but no property, no matter how special, may be completely immune to what is happening, as the statement reads: "Buyer beware"!
