Mallorca Property Market

This page offers a concise guide to the property market in Mallorca, covering the following sections:

• Market Segmentation by Price
• Mallorca's Coastal Premium
• Mallorca Property Market – Price Trends 2025
• Rental Returns for Property in Mallorca
• Notable Regions in Mallorca for Luxury Property
• Spanish Property Market – Setting the Context
• Outlook for the Mallorca Property Market
• Strength in the Face of Global Crisis
• How Will US Tariffs Affect Prices?
• Property Ownership in Mallorca – Freehold Structure

The island of Mallorca dominates the Balearic property market, accounting for around 80% of its transactions. Real estate in the region has been particularly resilient in recent years, characterised by a limited supply and an enduring high level of demand, especially in the luxury segment. For international buyers, the Balearic Islands, with Mallorca property leading the way, remain a secure and lucrative choice for investments, promising not only substantial returns but also a remarkably high quality of life.

Mallorca’s unique blend of an authentic Mediterranean lifestyle, stunning scenery, excellent island amenities and facilities, plus great air connectivity, has consolidated its position as a leading destination for international property investment.

Market Segmentation by Price

Mallorca’s real estate market has a reputation for being predominantly luxury, but the actual price distribution is more varied. We conducted our own research on 13 June 2025, analysing over 14,000 listings on Kyero. The most common price band for villas is €500,000 to €1 million, and more than half of all villa listings are priced under €2 million. However, we must note the strong luxury bias: 71% of villas in Mallorca are priced above €1 million, nearly 30% are listed above €3 million, and 10% are priced over €5 million. To put this into perspective, only around 9% of homes in London are currently valued above £1 million (source: Savills, February 2025). This reflects a strong concentration in the upper tiers, yet the island still remains accessible to a wide range of mid- and upper-tier international buyers.

This distribution shifts noticeably in Andratx, Mallorca’s most expensive municipality. Here, 86% of villas are priced above €1 million and 43% exceed €3 million. Only 34% fall below €2 million, compared with more than 50% across the island. This reflects a market deeply aligned with the luxury segment, not just at the top end but across all price tiers.

Apartments in Mallorca follow a different pattern. The most common price band is €400,000 to €500,000, and roughly half of all apartment listings are priced below €700,000. More than 50% of apartment listings fall between €300,000 and €800,000. Around one third are priced from €1 million upward, while only 10% of apartments exceed €2 million, reflecting a tighter distribution and less emphasis on the ultra-luxury segment.

Source: Kyero, June 2025

Overall, 59% of all residential listings across Mallorca are priced over €1 million. Taken together with the depth of the villa segment and the concentration of higher-end apartments, this reflects a market that is structurally skewed toward luxury, but still offers variety across price points. For a full breakdown by price band and property type, see our new article on Mallorca property prices and supply in 2025.

Detailed price segmentation tables for villas and apartments are included in the appendix.

Mallorca's Coastal Premium

Proximity to the coast remains a defining price driver across Mallorca. Based on Charlesdel Research conducted in June 2025 across 39 locations, coastal areas consistently command a significant premium, both within individual municipalities and across the island as a whole.

• Within intra-municipality comparisons, the premium for coastal zones typically ranged from 17% to 50%
• Across the island, areas with coastline averaged 40% higher prices than those without
• Fully coastal municipalities recorded 37% higher prices than fully inland ones

For a detailed breakdown by area, see our full report on Mallorca Property Prices and the Coastal Premium.

Mallorca Property Market – Price Trends 2025

As the market for Mallorca accounts for a vast majority of the total market of the Balearics, we can get a very good indication of price trends for Mallorca by looking at data for the Balearics as a whole:

10-Year Price Performance of Mallorca vs. Spain

The Mallorca property market has consistently outperformed most areas in Spain for many years and continues to do so today. Prices in the Balearic Islands rose by 148% over a 10-year period (June 2015 to June 2025), which corresponds to a compound annual growth rate (CAGR) of approximately 9.5%. By comparison, property prices across Spain as a whole increased by 61% over the same period, with a CAGR of around 4.9% (source: Idealista).

Summary of Property Prices in the Balearic Islands – As of end June 2025

As of end July 2025, source Idealista, the property prices in the Balearic Islands stand at 4,996 euros per square meter. Below are the annual price changes for each month for rolling 12-month period within a 12-month timeframe:

These figures indicate consistently high price increases for each 12-month period, ranging from 11.9 to 15.7%, reflecting the high demand and limited supply throughout the Balearics. This impressive growth in property prices underscores the regions' continued appeal as a prime location for real estate investment, particularly in the luxury segment.

* Note: Idealista uses a monthly estimate of the average residential prices based on live property listings on their platform. This reflects the current offer prices as opposed to the property sales price, but it serves as a valuable market indicator for price levels and trends.

Mallorca Property Price Trends by Area - As of End June 2025

Based on the latest data from Idealista as of end June 2025 — see tables in the appendix — the average price across Mallorca stands at €3,686 per square metre, with an average annual increase of +11.97%.

Looking at the premium municipalities with coastal areas, Andratx continues to lead with an average price of €7,503 per square metre and an annual increase of +11.9%. Calvià follows at €6,844 per square metre, with a +9.4% rise, while Palma de Mallorca has seen a sharp increase of +18.4%, bringing its average to €4,907 per square metre.

Among inland municipalities, Puigpunyent stands out as an exception, with prices reaching €5,413 per square metre and an exceptional annual growth rate of +42.1%. This reflects its rare combination of exclusivity, natural beauty, and strategic location. Set within the Tramuntana Mountains, Puigpunyent offers dramatic scenery and large, private plots ideal for luxury rural estates. It also borders Andratx and Calvià, the two most expensive municipalities on the island, and lies within easy reach of Palma — making it a natural next step as land supply tightens along the southwest coast.

These figures point to a consistently strong luxury market across Mallorca’s most sought-after areas, underlining the island’s reputation as a prime destination for high-end residential investment. See the areas in Mallorca for luxury property sales.

Rental Returns for Property in Mallorca

Over the past 10 years, long-term rental rates in the Balearic Islands have risen sharply. In May 2016, the average asking rent stood at €10.4 per square metre per month. As of June 2025, that figure has increased to €20.2/m²/month, representing a +94% increase across the decade.

By comparison, sales prices rose even faster, from €2,003/m² in 2016 to around €4,996/m² today, an increase of nearly +150%. This dynamic has compressed gross rental yields in Mallorca, which have declined from approximately 6.2% in 2016 to around 4.85% in 2025.

Still, a gross yield of 4.85% is highly competitive and similar to levels achievable in established urban rental markets such as London. According to Zoopla, the average gross rental yield for London properties stood at approximately 4.3% in early 2025. For investors focused on long-term rental property in Mallorca, the island offers stable income potential and relatively low management costs, particularly in demand areas such as Palma and its surrounding suburbs.

However, the strongest rental returns in Mallorca are typically found in the licensed short-term holiday rental segment, which is more closely aligned with the island’s positioning as a high-end lifestyle and second-home destination. In prime coastal areas, short-term holiday lets in villas or upscale apartments can achieve net rental yields in the range of 5% to 8%, as commonly quoted by established local rental companies, typically exceeding what’s achievable through long-term tenancy models.

Note: All short-term holiday rentals in Mallorca require a valid ETV (Estancia Turísticas en Viviendas) licence. New licences are not currently being issued in most areas, but existing ones are transferable to new owners. These licences certify that the property meets the legal standards for tourist accommodation.

Notable Regions in Mallorca for Luxury Property

Mallorca is the largest island of the Balearics with an area of 3,640 km² and has a coastline of approximately 550 kilometers. Approximately over three-quarters of the total property market of the Balearic Islands is accounted for by Mallorca, which has a very diverse range of property choices. From the city dwellings in the bustling historic capital of Palma to serene country homes, charming houses in coastal villages, and striking contemporary Mallorca villas and apartments, there are properties to suit all tastes. Below, we take a quick look at some of Mallorca’s key areas for luxury real estate. The figures quoted are from Idealista, year ending June 2024:

Southwest Mallorca: Puerto de Andratx, Santa Ponsa, Portals Nous, Calvia

This region is particularly well known for its luxury homes, and a majority of properties in the top market segment are located in the southwest of the island. In fact, according to research by Engel & Völkers, in 2023, 40 percent of the homes for sale in this region had asking prices of over 5 million euros. Southwest Mallorca features varied, stunning landscapes, including rugged clifftops, dramatic mountainous backdrops, fantastic sea views, green hillsides with hiking trails, and a range of gorgeous beaches. It is also the home of four luxury marinas, a selection of premium golf courses, and benefits from close proximity to the capital of Palma. Not surprisingly, discerning affluent international property investors and families are increasingly seeking this region of the island. Read more about Notable Areas for Luxury Property

Calvià, which includes premium areas like Bendinat, Costa d’en Blanes and Calvià town, is the second most expensive municipality in Mallorca, with an average asking price of over €6,600/m² as of December 2024, according to Idealista. The market here is defined by Mediterranean villas, fincas, and organic-modern builds, often with sea or mountain views. Limited supply, high international demand, and strong long-term fundamentals make Calvià one of the most resilient and desirable locations on the island.

Read our full guide to Calvià architecture and property prices

Spanish Property Market – Setting the Context

The Spanish property market has shown remarkable resilience over recent years, even amidst significant economic and geopolitical challenges such as the ongoing Ukraine war and rampant inflation. In 2022, the market reached levels close to the 2007 boom, with property prices consistently trending upward. Although the market began to cool slightly towards the end of 2022, 2023 still saw the second-highest sales in over 15 years, with sales figures 24% above the 10-year average. This performance was in part accounted for by strong foreign demand, particularly in regions of interest to international buyers such as the Balearics and Alicante.

Foreign buyers played a crucial role in maintaining market stability, with the number of transactions involving international purchasers remaining significantly higher than pre-pandemic levels. Despite a 6% decline in foreign sales compared to 2022, they were still 41% higher than in 2019. House prices in Spain increased by an average of 4.5% year-on-year in 2023, driven by firm demand and a chronic shortage of homes, particularly in major cities and popular coastal areas. This upward trend in prices contrasts with declines observed in other EU countries, highlighting the unique resilience of the Spanish market.

Outlook for the Mallorca Property Market

Global circumstances are putting pressure on the real estate markets worldwide, with ongoing conflicts and increased interest rates creating challenging conditions for primary markets. However, the demand for luxury property in Mallorca remains strong, even though the market has felt some impact. Prime properties in the best locations are staying on the market longer, as are some new builds and renovation projects. This situation does present opportunities for investors, as a moderate decrease in demand since the second quarter of 2023 affords better grounds for negotiation compared to previous boom years. Additionally, the recent wealth tax cut has been favourable for buyers and the real estate sector.

Historically, interest rates have not been exceptionally high, but the prolonged period of near-zero borrowing costs was an anomaly. Although rates have increased in recent years, property prices in Mallorca’s most sought-after areas have continued to rise - particularly over the past three years, with annual double-digit gains. This resilience is supported not only by sustained demand but also by limited land availability, rising construction costs, and the high standards typical of premium new builds on the island.

Are Mallorca property prices likely to fall in the near future? This is certainly unlikely in premium locations, such as Palma and the southwest, as historical data shows that prices have remained stable in these areas even during crises such as the COVID-19 pandemic. The north, coastal regions, and the Tramuntana Mountains are also considered solid real estate investment areas.

It is also worth noting that a new, financially strong buyer demographic from the USA and the Emirates is investing in Mallorca, as evidenced by new direct flight connections. Also, tax breaks have made the Balearic Islands more attractive for buyers of properties worth between 700,000 and 3 million euros. Effective January 1, 2024, the wealth tax burden has been reduced, raising the tax-free threshold from 700,000 to 3 million euros per person. This means only assets exceeding 3 million euros per person will be taxed for Balearic tax residents and non-residents.

Environmental consciousness is also increasingly influencing property buyers, who are now seeking homes equipped with eco-technology to reduce water and energy consumption sustainably. Properties with expansive outdoor land are in demand, allowing residents to grow their own produce or rear animals. Also, more homeowners are using their properties year-round, rather than just during holidays. Demand for properties with home office options has risen significantly, driven in part by the growing number of digital nomads seeking flexible living arrangements. Additionally, the trend of relocating primary residences to the island, which began during the pandemic, continues to grow. The presence of numerous international schools is also encouraging younger families to move to Mallorca permanently. Many new arrivals initially rent with the intention of purchasing property later.

The island's popularity continues to grow year by year, with Mallorca recording continuous rises in property prices over the last eight years. The general consensus by real estate analysts is that international demand for property in Mallorca will remain strong in 2025, particularly for properties in upper price brackets, with premium ocean view villas and exclusive apartments in prime locations the most sought after.

Strength in the Face of Global Crisis

The chart below shows how property prices in the Balearic Islands – dominated by Mallorca, accounting for around ¾ of property transactions – performed from 2006 to 2024 in response to the most significant global economic crises during this period.

From 2007 to 2024, Mallorca's property market was tested by five major global economic crises. The bar chart reflects how each event influenced pricing trends, revealing both short-term impacts and longer-term resilience.

The Global Financial Crisis in 2007–2008 triggered the initial downturn, with prices in Mallorca falling during both years. However, compared to other real estate markets, the decline was more moderate. A strong international buyer base, especially in the luxury segment, and high levels of cash transactions limited the damage. By 2009, the chart shows that recovery was already underway.

The European Debt Crisis from 2010 to 2012 brought renewed pressure, as Spain’s economy struggled with high unemployment and growing fiscal instability. Property prices in Mallorca fell further during this period, though the drop was most pronounced in inland or oversupplied areas. The island’s prime locations held up best, supported by continued foreign demand and a healthy tourism sector.

During the Spanish Austerity Program (2012–2014), the national property market continued to deteriorate, dragged down by tight credit conditions and weak domestic confidence. In contrast, Mallorca’s prices stabilised, forming a plateau. The island’s strict planning rules, limited overdevelopment, and continued appeal to cash-rich international buyers helped prevent further decline.

The COVID-19 pandemic in 2020 caused severe disruption to travel and in-person transactions, but prices in Mallorca did not fall. Instead, they remained stable through the lockdown period and rose steadily from late 2020 through 2021. This reflects both constrained supply and the perception of Mallorca as a secure, high-quality destination for lifestyle and investment.

In 2022, the Ukraine war and resulting inflation shock placed new pressure on European property markets. Rising interest rates impacted mortgage-reliant buyers across the continent. Yet Mallorca again diverged: prices continued to climb, with a 12% increase recorded from December 2022 to December 2023. Limited supply, sustained international demand, and low reliance on borrowing helped the market to once again post record prices.

The chart above is testament to the ability of Mallorca’s property market to withstand and recover from the world’s most significant economic shocks over the past two decades. The robustness of its market is due to several inherent characteristics.

A high proportion of high-net-worth individuals, second home and lifestyle buyers, and long-term investors play a central role. This group brings two key advantages: a lower reliance on financing, with many purchases completed in cash, and a greater ability to absorb economic shocks without being forced to sell.

Tourism-led demand – sustained by a strong year-round tourism sector – feeds the market. Strict planning and zoning restrictions help to limit supply and support long-term pricing stability. All of this is underpinned by Mallorca’s world-renowned status as a luxury holiday and investment destination – in effect, the brand of Mallorca.

How Will US Tariffs Affect Prices?

In April 2025, the United States announced sweeping new tariffs that triggered global economic uncertainty and sharp declines in major stock markets. While direct exposure to U.S. buyers is limited, these policy shifts have heightened market volatility and led to downgraded GDP forecasts across the globe. The resulting pressure on key currencies and economies within Mallorca’s international buyer base is shaping a more cautious European outlook.

For a deeper analysis of how the new U.S. tariffs could affect demand and pricing in Mallorca’s real estate market: Read our full article on US Tariffs and Mallorca Property

Property Ownership in Mallorca – Freehold Structure

From an investment standpoint one of the key advantages of buying property in Mallorca is the clarity and permanence of ownership. Unlike in the United Kingdom where apartments are typically sold on leases with diminishing terms and ground rent obligations, residential properties in Spain including apartments are sold freehold, giving buyers long-term security and full legal title.

In apartment buildings and residential developments with shared elements, ownership is governed by Spain’s Horizontal Property Law (Ley de Propiedad Horizontal). This means you own your private unit outright and also hold a proportional share of any communal areas such as land, gardens or hallways.

This structure applies not only to apartments but also to villa developments and urbanisations with shared amenities. Leasehold sales are extremely rare in Spain, and where they do exist they are typically used for long-term rental agreements with terms commonly running for five years. Unless clearly stated otherwise, properties advertised to overseas buyers are sold freehold.

For more legal detail see our Property Ownership in Spain FAQ.

See our guest post on PropertyWire about the Mallorca property market, covering 18 years of performance and resilience.

Appendix: Detailed Pricing Tables

Mallorca Property Prices by Municipality – June 2025