Property prices in Mallorca have developed very steadily to significantly upward in recent years. Particularly in demand are sea-view properties, real estate in the southwest region (Port d’Andratx, Santa Ponsa, Bendinat, Portals), as well as high-quality city properties in Palma.

As the supply of land is limited and demand is international, prices remain high in many locations. Premium properties and modern new builds, in particular, regularly achieve significant increases in value.

The purchase process is clearly structured, but slightly different than in Germany:

1. Apply for an N.I.E. number – Tax identification number for foreigners (mandatory).
2. Open an account with a Spanish bank – necessary for payments and future taxes.
3. Property inspection and reservation via a reservation document and down payment.
4. Option de Compra (Option to Purchase Agreement) – usually with a 10% down payment.
5. Legal and property due diligence by a lawyer or Gestoría.
6. Notary appointment and purchase agreement (Escritura Pública).
7. Land registry entry by the Land Registry Office (Registro de la Propiedad).

A lawyer is highly recommended, as they check all documents, permits, and encumbrances.

For buyers:

• Real Estate Transfer Tax (ITP) for existing properties: between 8-13%, depending on the purchase price.
• VAT (IVA) + Stamp Duty (AJD) for new constructions: 10% – 1.5%.
• Notary and Land Registry fees: approx. 1-2% of the purchase price.
• Legal fees: usually 1% of the purchase price.
• Ongoing ownership costs: IBI (property tax), waste collection fees, community fees.

For sellers:

• Plusvalía Municipal – municipal capital gains tax on land.
• Capital Gains Tax on profits: 19% for non-residents.
• Brokerage commission: typically 5-6% of the sale price (paid by the seller).

Important points include:

• Review of ownership status (Registro de la Propiedad).
• Review of building permits and usage rights – essential, especially for fincas.
• Certificate of habitability (Cédula de Habitabilidad) must be available.
• Energy certificate (Certificado Energético) is mandatory.
• Encumbrances (mortgages, debts, rights of way) must be checked before purchase.
• For rural properties, strict building and renovation regulations often apply.

An independent lawyer carries out the full legal review and provides peace of mind.

The duration depends on location, property type, and demand, typically:

• standard apartments/houses: 2-6 months
• luxury properties or fincas: 6-12 months
• specialized properties or properties requiring clarification: potentially longer

The process from purchase offer to notary appointment usually takes 4-8 weeks, provided all documents are complete.

Several financing models are available to buyers:

• Spanish banks: usually finance up to 60–70% of the property value determined by the bank.
• German banks: financing via mortgages on German properties or special foreign loans.
• Mixed financing: a combination of German and Spanish financing.

Buyers should note that Spanish banks often require more documentation, and the interest rate may vary depending on the country of residence.