Majorca Property News

Mallorca real estate: buy now - the tax benefits end on 31/12/2010

The Spanish government has intensified since January 2011, the tax laws: an apartmant from January 2011 on is to settle by buyers only if they have an annual income below € 24.107.

Estate Agents contradict the negative spot reports in the German media.

In Mallorca, the market consolidated after the onset of the economic crisis in 2008/2009, in contrast to the Spanish mainland, relatively quickly. It has taken place over the last 1.5 years, a market price adjustment, over-priced homes have experienced a realistic market adjustment. On average, the prices on the holiday island at the time by 15 to 18 percent have declined.

This year, however, the market strengthened so that the real estate agents here and there even perceive price increases. In the southwest of the island, the current average price of sold homes is still around one million euros - so not a bargain. This average price was in 2007, before the crisis, calculated and remains unchanged. The South East of Mallorca is there with an average price of 900,000 € per sold property not far behind.

Banks sits tighter regulation in the neck

Fact: Since the collapse of the housing bubble and the beginning of the economic crisis, many developers and private individuals do not pay their loans. The buildings and homes took to the banks - now the Spanish banks are sitting on large real estate portfolios, which they obviously want to get rid of as quickly as possible.

For the Spanish central bank takes the reins: it requires more savings for the property portfolios of financial institutions. If a property has not sold after one year, the bank must raise additional provisions in the amount of ten percent of the property value. In addition, institutions must correct value real estate loans that are no longer to be served, within a year. In addition, a property is a non-productive assets in the portfolio of a bank. If a house or apartment but sold until the money earned back home - to the mortgage loans that can pay the new buyers hopefully better than its predecessor.
Summing together all these matters, is currently the right moment to purchase a property in Mallorca. Cheaper it will no longer be tax deductible item for the vast majority of buyers on 31/12/2010.