Wealthy cash buyers driving Ibiza property market forward
05-07-2012
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The interest in high end property is shown by the fact that 70% of listings on the new Ibiza Sotheby’s International Realty website are priced in excess of €1.5 million.
‘Remarkably, given obvious global economic conditions, this winter was one of our busiest on record with the bulk of buyers looking for a property priced between €1 million and €2.5 million. With a scarcity of bank lending, most of these intend to purchase with cash and hope to do a deal on the quoted asking price. Property in Ibiza is selling, the market is moving, provided the price is right,’ said Amanda Martí, director of the Ibiza Sotheby’s International Realty.
She pointed out that the most sought after homes in Ibiza are facing the Mediterranean with good sea views or tired properties in need of renovation but in the best locations. ‘Buyers are also waking up to the beauty of the wilder and less commercialised north of the island, for example the unspoiled town of Sant Joan de Labritja where we are currently selling a whitewashed €3.5 million euro villa designed by Jade Jagger for Yoo,’ she explained.
‘Our problem is a lack of modern style properties with privacy and fantastic sea views, the demand is there but the supply is diminishing. Owners are wise to this and therefore reluctant to reduce their prices,’ she added.
As with the rest of Spain, prices on Ibiza have fallen, but not as far and as widely as in mainland Spain. ‘From the peak in 2005 to 2006, values have decreased 20 to 30%, perhaps more for apartments, but it is location dependent with sought after areas and desirable modern architecture holding up much better,’ explained Martí.
‘The reason for the more marked price drop off in the apartment sector is the reluctance of banks to lend, putting the brakes on this lower end of the market. However, new mortgage options are appearing on an almost daily basis in Ibiza with 70% loan to value available for non-residents on the condition that the projected monthly repayment does not exceed 40% of the buyer’s income,’ she added.
She believes that with many different nationalities participating in the property market, vendors largely British and German, buyers from Holland, Switzerland, Belgium, Italy and the City of London, the Ibiza market remains a solid investment and resilient to the bigger picture Spanish property crisis.
Ibiza is a small island, at little over 570 square kilometres and there is a lack of building land and strict planning laws in place to keep prices high and the vital supply demand equation in check,’ explained Martí.
‘Ibiza is still the “in” place to own a home and works off-season for permanent living thanks to Morna International College teaching the UK national curriculum and the College Francois subsidised by the French Government. British Airways is also offering direct flights from London City Airport throughout the winter for commuters or weekend breakers,’ she added.
An Island of extreme landscapes and cultures, Ibiza has become popular with everyone from upwardly mobile jet setters to bohemian yoga fanatics and of course the thousands of young clubbers who come to watch their DJ heroes at work.
Away from the madness of the clubs and bars, Ibiza boasts breathtaking coastal walking trails, enchanting woods and the small coves and resorts of the northeast are especially family friendly. Real estate on the Island ranges from modern apartments in private gated communities through to rustic Ibicencan styled villas and state of the art minimalistic residences.
