According to the president of the API association of estate agents, José Miguel Artieda, an estimated 55,000 people will be looking for a home in Mallorca in 2026, this estimate being based on the experience of previous years, population growth, and average family size.
But one of the biggest concerns for people who will be looking to buy a home is price. Artieda says: "We've experienced eleven years of incredible price increases and frenetic activity. We've come to think that this is normal. However, this intensity is not sustainable in Mallorca: neither in terms of housing development capacity nor household borrowing capacity, as salaries are increasing at a much slower rate than house prices.
"Considering that the main cause of the price increase is demand pressure, there is nothing in sight that will eliminate it. A natural decrease in prices is not expected." Artieda nevertheless believes that any increases in prices to buy or rent will be moderate. "People's purchasing power has reached its limit. Until now, this had seemed limitless. In the luxury sector, however, it remains to be seen what that limit might be."
Daniel Arenas of the ABINI association, members of which operate mainly in the luxury sector and with a largely foreign client base, says "prices will continue to rise so long as there is no more housing supply on the market, although we expect at a more moderate pace than in recent years." "In a few years, a greater volume of affordable housing should enter the market, which would help to contain the upward trend."
Arenas doesn't anticipate there being any price decreases in the luxury market. "There is no land left for construction. Therefore, most developers are opting to buy older homes to renovate or demolish. Construction costs are not decreasing, labour costs continue to rise, and the time required to obtain permits has not been sufficiently expedited."
"The major underlying problem in the Balearics is the lack of supply - scarcity of available land, slow licensing procedures, and insufficient development of affordable housing. With the measures being implemented by the Balearic Government, improvements are expected to begin to be seen, especially with the release of new land and a gradual increase in the supply of affordable housing."
Economist Pau Monserrat observes that "around a third of the adult population is looking for housing on the island, and the supply is very limited, making us the most stressed territory in the country". He agrees that house prices will not fall in Mallorca. "We have had years of strong economic growth, which leads to business growth and a need for labour that cannot be met solely by local workers. This has resulted in foreigners from many countries coming to live on the island."