Authored by the expert who managed and guided the team behind the Spain Property Pack
Yes, the analysis of the Balearic Islands' property market is included in our pack
Where are the best places to invest in the Balearic Islands right now? Is Palma de Mallorca still the top pick, or are areas like Ibiza Town, Santa Eulària, and Mahón gaining ground? What makes these locations attractive to both local and foreign investors?
We’re often asked these questions because we work directly with notaries, real estate agents, and clients who invest across the islands. Our firsthand experience in these markets gives us unique insights into where the real opportunities lie. To save everyone from asking privately, we’ve written this article to share our knowledge broadly.
Our goal is to highlight the hottest markets in the Balearic Islands and explain why they’re worth your attention in 2025.
If you have suggestions or want us to dive deeper into a specific area, let us know. You shoot an email, we answer within 24 hours.
1) Alcúdia is gaining interest for its beautiful beaches and high potential returns on vacation rentals
Alcúdia is catching eyes for its stunning beaches and lucrative vacation rental market.
In 2023, the Balearic Islands, including Alcúdia, saw a record-breaking influx of 14.4 million foreign tourists, a 9.1% jump from the previous year. This boom in visitors led to a 16.4% increase in tourism spending, reaching €17.22 billion. December alone was bustling, with nearly 166,000 international tourists, marking a 26.7% rise from the previous year, and their spending soared by 48.8% to €215 million.
Alcúdia's property market is heating up, mirroring the broader trend across the Balearic Islands. The area is becoming a hotspot for real estate, driven by the booming tourism industry. This surge in interest is reflected in rising property prices, making it a promising investment for those eyeing vacation rentals.
In Majorca, where Alcúdia is located, vacation rentals are a hot commodity. A typical short-term rental is booked for 277 nights a year, boasting a median occupancy rate of 76% and an average daily rate of €186. This high demand translates into substantial profits for property owners.
In 2023, a typical host in Majorca earned an annual revenue of €48K, with a year-over-year revenue increase of 13.65%. This makes short-term rentals in Alcúdia not just popular but also highly profitable.
With its beautiful beaches and thriving tourism, Alcúdia offers a unique opportunity for property investors looking to capitalize on the growing demand for vacation rentals.
Sources: Grupo Dynasoft, Airbtics, Euro Weekly News
Here is a peaceful seaside terrace in Alcúdia, a destination that combines stunning natural beauty with a booming vacation rental market. (Source: ABC Mallorca)
2) Santa Catalina in Palma de Mallorca is booming with its trendy vibe and high demand for luxury apartments from international buyers
Santa Catalina in Palma de Mallorca is a hotspot for international buyers thanks to its trendy vibe and luxury apartments.
In recent years, property prices in Santa Catalina have surged, with the price per square meter hitting 5,187 €. This marks an annual increase of 1.3%, showing just how popular the area has become.
New luxury apartment complexes are popping up, offering high-quality apartments and penthouses that attract affluent buyers. These developments are not just boosting the local real estate market; they’re drawing in high-net-worth individuals looking for exclusive properties.
Santa Catalina's charm lies in its vibrant lifestyle and amenities. The neighborhood is famous for its variety of restaurants and fashionable tapas bars, making it a lively place to live.
The local market is a social hub, adding to the area's appeal. This mix of modern conveniences and local charm makes Santa Catalina a sought-after location for international buyers.
With its trendy atmosphere and high demand for luxury living, Santa Catalina is truly booming. International buyers are flocking to this vibrant neighborhood for a taste of its unique lifestyle.
Sources: Homes by Gestilar, Berkshire Hathaway HomeServices, Lifestyle Properties Mallorca
We have made this infographic to give you a quick and clear snapshot of the property market in Spain. It highlights key facts like rental prices, yields, and property costs both in city centers and outside, so you can easily compare opportunities. We’ve done some research and also included useful insights about the country’s economy, like GDP, population, and interest rates, to help you understand the bigger picture.
3) Santanyí is attracting interest for its charming town center and potential property value growth with demand for authentic Mallorcan experiences
Santanyí is becoming a hotspot for those looking for authentic Mallorcan experiences and potential property value growth.
In recent years, the real estate market in Mallorca, including Santanyí, has been on the rise. The average price per square meter jumped by 11% from €4,063/m² to €4,512/m² in the first eight months of 2024. This surge is largely due to the island's unique charm and cultural richness.
The Balearic Islands, with their stunning landscapes and vibrant culture, have seen a boom in tourism. In 2023, Mallorca welcomed 12.48 million visitors, with 10.69 million being international tourists. This influx highlights the growing allure of the region.
Foreign buyers are particularly drawn to traditional towns like Santanyí. In 2022, 35.10% of real estate transactions in the Balearic Islands were made by international buyers, showing a strong global interest in the area.
For those considering a property investment, Santanyí offers a blend of traditional Mallorcan life and modern amenities. The town's picturesque streets and local markets provide a genuine taste of the island's culture, making it a desirable location for both living and investing.
As more people seek out these authentic experiences, property values in Santanyí are expected to continue rising. The town's appeal lies not just in its beauty but also in its potential for growth, making it a smart choice for future homeowners.
Sources: Yes Mallorca Property, Euro Weekly News, Yes Mallorca Property
4) Deià is a hot market with its picturesque setting and limited supply of traditional stone houses driving up prices
Deià is a hot market because of its picturesque setting and limited supply of traditional stone houses.
In September 2024, the average price per square meter for homes in Deià was €9,112. This is a big jump from September 2023, when it was €6,895. Such a sharp rise shows how much people want to live here, but there just aren't enough homes to go around.
Buyers often rave about the village's charm and exclusivity, which only adds to its appeal. The Balearic Islands have strict development rules that help keep Deià's traditional look intact. This means new construction is limited, preserving the village's unique allure.
Deià's stunning views and quaint atmosphere make it a dream spot for many. But with fewer homes available, prices are naturally going up. It's a classic case of high demand meeting low supply.
For those considering a move, it's worth noting that Deià's market is not just about buying a home; it's about buying into a lifestyle. The village offers a mix of natural beauty and cultural richness that is hard to find elsewhere.
So, if you're thinking about buying property here, be prepared for a competitive market. The combination of limited availability and high demand means acting fast is key.
5) Port d'Andratx is drawing wealthy investors with its stunning sea views and exclusive villas, driving significant property appreciation
Port d'Andratx is a hotspot for wealthy investors thanks to its stunning sea views and exclusive villas.
In early 2023, the average price per square meter hit 3,706 euros, reflecting the area's growing appeal. The demand for luxury villas, especially those with sea views, often pushes prices beyond 2 million euros.
Adding to its charm, Port d'Andratx is a favorite among celebrities and influential business figures, who are drawn to its secluded, upscale coastal lifestyle. Their presence boosts the area's exclusivity and prestige, making it even more enticing for investors.
The limited availability of sea-view properties has sparked fierce competition, driving prices even higher. Real estate experts point to Port d'Andratx as a prime spot for luxury property investments, thanks to its exceptional growth potential and scarce available plots.
For those in the know, Port d'Andratx offers a unique blend of natural beauty and high-end living, making it a top choice for those seeking a slice of paradise. The area's allure is undeniable, with its combination of stunning landscapes and luxurious amenities.
Investors are keenly aware of the opportunities here, as the region continues to attract a discerning crowd looking for both privacy and prestige. The ongoing demand ensures that Port d'Andratx remains a coveted destination for luxury real estate.
Sources: Dahler & Company, Yes Mallorca Property, Homerun Mallorca
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6) Son Vida in Palma is booming with its exclusive golf courses and luxury estates attracting affluent buyers
Son Vida in Palma is a hotspot for luxury real estate, thanks to its exclusive golf courses and opulent estates.
Imagine living in a place where three world-class golf courses are practically in your backyard. Managed by Arabella Golf Mallorca, these courses, including the historic Golf Son Vida, are not just about the game; they foster a vibrant international community, adding to the neighborhood's allure.
But it's not just about golf. The area is buzzing with new luxury projects and high-end amenities. Take the 5-star Castillo Hotel Son Vida, for instance. It's a place where luxury meets comfort, further cementing Son Vida's status as a prime spot for the wealthy.
All these elements have led to a noticeable increase in property prices. If you're considering investing, Son Vida's market is on the rise, making it a sought-after destination for those looking to buy into luxury.
For those who crave exclusivity, Son Vida offers a unique blend of privacy and community. The neighborhood's reputation for luxury living is not just about the homes; it's about the lifestyle that comes with them.
Whether you're a golf enthusiast or someone who appreciates the finer things in life, Son Vida offers a lifestyle that's hard to match. It's no wonder affluent buyers are flocking here.
Sources: Balearic Properties, Helen Cummins, Horizon Capital, Arabella Golf Mallorca
7) Sóller is booming with demand for its scenic location and historic properties popular among expatriates
Sóller is becoming a hot spot for property buyers, thanks to its stunning scenery and charming historic homes.
In 2024, the average property price in Sóller jumped to €5,294 per square meter, up 17.70% from the previous year. This rise shows how attractive the area has become for those looking to invest in a picturesque setting.
Real estate agents are buzzing about Sóller, actively marketing it as a prime location for potential buyers. The town's allure is often highlighted in media, drawing in expatriates who are captivated by its beauty and history.
Social media is also playing its part, with platforms frequently showcasing Sóller's breathtaking landscapes and historic architecture. This online buzz is boosting interest and making the town even more appealing to foreign buyers.
Travel and lifestyle magazines are not far behind, featuring Sóller as a must-visit destination for its scenic views and quality of life. These features add to the town's growing reputation as a desirable place to live.
With its unique blend of natural beauty and historic charm, Sóller is capturing the hearts of many who are looking for a slice of paradise in the countryside.
Here is a stunning villa in Sóller, showcasing the charm of traditional stone architecture combined with modern Mediterranean luxury, perfectly embodying the area's appeal to expatriates and property buyers. (Source: Sun-hat Villas)
8) Valldemossa is attracting buyers with its cultural heritage and limited property availability, driving up prices
Valldemossa is a hot spot for property buyers thanks to its rich cultural heritage and limited property availability.
Perched in the stunning Serra de Tramuntana, a UNESCO World Heritage Site, Valldemossa offers a unique blend of history and natural beauty. This prestigious designation not only attracts tourists but also potential buyers who are captivated by the area's charm.
The village's allure is further enhanced by its historical gems, like the royal monastery founded by King James II of Mallorca and its connection to the famous composer Frédéric Chopin. These cultural landmarks make Valldemossa a prime choice for those seeking a property steeped in history.
In Valldemossa, the real estate market is buzzing with activity due to a mismatch between supply and demand. With few properties available and many eager buyers, bidding wars are common, and homes often sell for more than the asking price.
This trend mirrors the broader real estate scene in Mallorca, where property prices are climbing because of limited supply and strong demand. Buyers are drawn to the island's unique offerings, and Valldemossa stands out as a particularly desirable location.
For those considering a purchase, it's worth noting that Valldemossa's property market is competitive, reflecting its cultural significance and the scarcity of available homes.
Sources: Indomio, Sollerweb, Private Property Mallorca, CIEE
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.
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