Minorcan economist Eduardo Robsy was instrumental in drafting the Balearics first housing law, which came into effect in June 2018. A year later, he became the government's director-general of housing, a post that he left in May 2022.
One of the most influential voices in the Balearics when it comes to the economics of housing, Robsy argues that foreign buying does contribute to a general increase in the price of housing.
"A greater demand, wherever it comes from, will always produce an increase in prices if the supply remains practically stable. The argument is that these foreign buyers are people with great fortunes who buy luxury homes that are not available to the local population and which are therefore distant to the market for utilitarian housing. However, studies suggest that when there is a price increase in the luxury real estate sector, it generates a drag effect on the other sectors and the most affordable housing ends up becoming more expensive.
As to some sort of ban on foreign buying, he has his doubts as to its impact. "We would have to see what happens. New Zealand took this measure in 2018 because there was a sustained increase in prices that made it difficult for residents to access housing, but that price increase has not abated. Canada has also decided to restrict purchases. I don't know if I see much point in it and I would be surprised if it had a significant impact. It's hard for me to see this measure having an effect in light of experience, legal difficulties aside; it would have too little foreseeable impact to justify it."