Natalia Bueno of the API association of real estate agents in the Balearics says that rents are continuing to rise because there is less and less supply, while demand isn't ceasing. Because of this, she says that people are having to move to the mainland in order to find somewhere to live.
She blames the Spanish government's housing law, which was passed in May, for having created additional stress in the rentals market; it is having the precise opposite effect to that which had been intended. In the Balearics, the number of properties has been reduced by between 20% and 30%.
"Owners prefer to sell or to stop renting or to give properties to their children, who can't find homes either. More and more clients are telling us that they want to stop renting their apartments because in a few years their children will need them."
Another dynamic that Bueno points to is that renting out is to the highest bidder. Association members report an increasing number of cases of people offering owners more money than they are asking to rent a property. "Tenants are making bids of their own. They tell agencies to advise owners that they are willing to pay 100 euros or more in exchange for keeping apartments."
As to prices, she believes that Mallorca is on its way to becoming like Ibiza. "For less than 1,200 euros it's impossible to find something with two or more bedrooms."