If there is one thing property agents have learned during the last year, it’s that nothing is predictable. The heart of the Ibiza property market barely skipped a beat and has still managed to come out stronger than ever. Current data points to a sustained recovery even when compared to the two previous pre-pandemic years.
Detached primary residences and second homes as well as long term rentals are the most sought opportunities. The decrease in holiday rentals due to travel restrictions has been noticeable and has added to the urge for some people to invest in holiday homes as opposed to renting. The average square metre rate across Ibiza and Formentera jumped slightly from 3,728€ in 2020 to 3,972€ in 2021. The upper end of the market registered values between 10,000€ and 20,000€ per square metre showing that the luxury market is still hot. New developments are few and far between, with around 300 dwellings in various stages of development across the island and some areas suspending development entirely until things return to normal.
Ibiza comes in as one of the more expensive Spanish regions but the lifestyle makes up for it without a doubt. Locally, there is still a dearth of available houses which continues to drive prices up, in some cases into the double digits across the Balearics. Wealthy European buyers with cash to hand, have given serious thought to their lifestyles and the trend towards finding a second home that allows for a safe and comfortable retreat has exploded. German buyers are still in the lead followed by British then French and Dutch, with most seeking secondary homes. By the end of the first quarter of 2021, foreign buyers were at 83% of pre-Covid figures. Not bad considering the precariousness of the global economy. Real estate has always been seen as a safe investment during difficult times and that is truer now more than ever.
The Ibiza property market has continued to be very strong in the higher end despite a slow downward turn that started in 2017. The first quarter of 2021 saw 257 sales down by 17% due almost entirely to demand outweighing supply. Obviously, a drop in demand occurred during the deepest days of lockdown due to travel restrictions, although some hardy buyers took the leap and bought homes via virtual tours.
While many sectors across the world are experiencing a slow recovery the Ibiza market still manages to remain one of the most buoyant in Europe. It’s hard to see a time when that ceases to be the case as the island provides what so many people are looking for – an envious lifestyle played out against a backdrop of magnificent weather. There are still few places in the world that consistently delivers on its promise of paradise.
According to the quarterly report by the Land Registry, with international geographic mobility recovering and the level of confidence in the control of the pandemic increasing, foreign demand will continue to grow, helping to boost sales in the residential real estate sector. However, take note, data is in the eye of the beholder and should you be seeking up-to-the-minute stats, get in touch to make an appointment with one of our agents.
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