Dear Friends, Clients and Customers,
We are now at the tail end of the season and with this perspective at hand and data for the season starting to emerge, we can safely conclude that in 2016 will be another strong year in terms of visitors and average spend.
The island is experiencing an increase of some 15-20 % in the out of season and the low and mid season visitors, which is good news, and means it can expand beyond the June-September season.
Our June to September season will also see record numbers again this year increasing by a forecast of 10-12%.
There are several luxury hotel projects underway, most will be on the market in 2017, increasing capacity significantly in the 5 & 4 star segment, albeit from a low base (less than 5% of the beds are 5 & 4 star), and house sales have increased significantly in recent years (over 50%).
Politically, the recent change in local government has meant, at least for the moment , an even stricter approach to planning and housing legislation.
Building and refurbishing permissions have been cut back, meaning the available legalised offer is, evermore scarce, and consequently this is driving prices higher.
Land to develop has become even more restrictive, and again those with actual planning permission have increased considerably in value.
The prime real estate market remains buoyant and we expect home sales to increase and prices to rise again in 2016, following the trend established in the past 3-4 years. Demand is mostly foreign and mostly cash buyers.
The vacation rental market again is expected to be strong this year and is now consolidating attractive rental yields for buy to let investors with net yields of around the 4-5%.
Prices can vary, but for prime quality real estate, expect to pay over €4 mm for a 480 m2 finished product in the countryside with a large plot (30,000 m2 plus) or a similar sized house albeit on smaller plots (5,000 m2 minus) with a sea view and close to the sea.
Prime “fincas” to be rebuilt or refurbished depend largely on licenses, but again expect to pay between €2-2.5 million and budget for building costs of €2500/m2.
Good sized plots in prime locations with an active license to build can command prices of over €2mm.
A frontline luxury apartment with some 150m2 with sea views on the golden mile in Ibiza town costs upwards of €1.5 mm
As it stands, it is still pretty much a sellers market.
Houses in Ibiza
Houses in Ibiza