No end to Ibiza boom: Prices for property in prime locations rise by up to 10 percent

Posted by Team Global Corporate Communication on March 16, 2015.

There appears to be no end in sight to Ibiza’s property market boom. Having risen by 5 percent in 2013 at prime locations on the Balearic island, 2014 saw property prices rise by another 10 percent. The number of sales transactions has also increased. Both Engel & Völkers Shops on Ibiza registered 15 percent more property sales in 2014 than in the previous year. This positive trend is set to continue in 2015. During the first weeks of the year, Engel & Völkers closed more sales than ever before in a first quarter over a total of 14 years operating on Ibiza. This is according to the “Ibiza Market Report 2015” published by Engel & Völkers.

Hotspot Ibiza: price rises due to international demand
Ibiza is a popular holiday destination amongst celebrities and a magnet for the wealthy international jet set. The Mediterranean island also attracts affluent property buyers from around the world as a result. Demand is also heightened by a flourishing tourism industry. In 2014, 13 percent more tourists holidayed on Ibiza than in the previous year. Ibiza’s intensive efforts to focus on quality and luxury tourism play a key role here. This includes a number of new 5-star hotels, world-class cuisine and entertainment, and a yacht marina that is set to turn Ibiza – alongside St. Tropez – into the leading marina in the Mediterranean for superyachts over 70 metres. This is boosting the island’s popularity as a refuge for Hollywood stars, top sporting personalities and business tycoons. Ibiza’s beautiful scenery, coupled with its myriad of recreational activities, is drawing both nature lovers seeking peace and quiet and modern cosmopolitans alike.

 “It is above all the stability of the market and the superb quality of life that’s attracting house buyers,” said Florian Fischer, Managing Partner of Engel & Völkers on Ibiza. Clients looking to acquire a luxury property for a moderate price on Ibiza are too late. Substantial estates with high-end fittings and a premium location, like the region surrounding trendy Ibiza Town or the highly exclusive village Es Cubells in the south, are changing hands for seven-figure sums. And across the entire island, even 100 square metre apartments in average locations are now valued at a minimum of 280,000 euros.

Interest from outside Europe on the rise
The second home market is dominated by clients from German-speaking countries, followed by buyers from Benelux, the UK, Italy and France. Last year also saw a significant increase in buyer interest from farther afield, including the USA, Brazil and Mexico. The stabilisation of the economy on the Spanish mainland has also led to increased activity on the market from national buyers.

 

 

Outlook: Upward price curve set to continue
Engel & Völkers forecasts that the property market on Ibiza will continue to see positive development for the rest of the year and that prices for premium estates in sought-after locations will rise further in the long term. “The high demand from abroad is centred on an increasingly limited supply of properties in the island’s best locations. That is bringing stability to the market, along with sustained value growth,” Florian Fischer added.