Mallorca and Ibiza propose a moratorium on the sale of real estate to foreigners
Following Canada, where foreigners can no longer buy real estate, officials of the Balearic Islands are asking Madrid to introduce a similar ban. According to local authorities, foreigners have recently bought too many properties on the islands, which has contributed to a spike in home prices.
According to the Guardian, officials of the Balearic Islands are seriously concerned about the state of the island real estate market. High housing prices and lack of supply have almost driven the local population from the market, making it almost impossible for them to buy property.
Juan Pedro Illanes, vice president of the Balearic Islands, said: «We must follow Canada’s example» and asked the Spanish government to pressure the EU to allow the islands to impose a similar ban. In his opinion, such a ban is necessary, even though it would contradict the European principle of free movement. Moreover, cases of such bans already exist.
For example, there are precedents in the Austrian Alps, where the EU recognized areas of cultural significance or natural beauty, which should be protected from «excessive external pressure». Another precedent is the Åland Islands in Finland, where there are restrictions on the purchase of second homes. In Croatia, EU citizens must be residents for 10 years before they can buy agricultural land.
The president of the Balearic Islands, Frankina Armengol, previously said: «Many European and other citizens can afford real estate at prices that are impossible for the citizens of these islands". Now rents or mortgage costs exceed 30% of the average monthly income of the local population.
However, high prices are not the only problem of popular resorts. Wealthy foreigners often buy real estate on the island as a «second» home, using it only from time to time. As a result, on Mallorca and Ibiza began to appear the real «ghost villages» of empty homes.
For example, in the village of Dei, where out of 700 houses 200 are empty, 37% of all properties in the village belong to foreigners (23% to the British). As a measure, the local authorities have doubled the municipal tax on empty properties, but it is unlikely to have much impact on their wealthy owners.
According to the National Statistics Office, foreign buyers accounted for 38.95% of purchases in the Balearic Islands in 2022, compared with a national average of 12.61%.