Balearic Islands see rental price hike

Recent figures show that rental prices in the Balearic Islands have skyrocketed, experiencing a staggering 17.3 per cent increase compared to last year.

This significant rise has positioned the islands as Spain’s third in line for the most substantial rental price hike. The average rental cost in February stood at an eye-watering €17.15 per square metre.

This not only marks a 2.7 per cent increase from the month prior but also tops the region as the priciest for renters. In Palma, the average price reached €16.66 per square metre in February, securing its spot as the fourth most expensive city in the country for renters.

Despite a slight 1.6 per cent decrease from January, Palma’s rental prices have surged by 13.7 per cent in comparison to the previous year.

At a national level, Spain saw a moderate 0.9 per cent monthly increase in rental prices, averaging €11.32 per square metre. This reflects a 7.9 per cent rise on a year-to-year basis.

Ferran Font, from the real estate portal flats.com, emphasised the intricate link between the sales and rental markets. He suggests that high buying prices lead landlords to seek profitability, which can reduce rental availability.

Furthermore, Font criticises government measures like the reference price index, which has faced implementation challenges and could potentially reduce the supply of rental properties.

He argues that restricting landlords could harm the rental market, stressing the importance of strategic decisions to increase public housing rather than penalising existing structures. This approach, he claims, is vital for tackling the issue of accessibility in the housing market.