Following the approval of Decree Law 1/2016 of 12 January on the amendments of the Plan of Urban Development in the Balearic Islands we have know that last year there was a significant increase in cases of legalization on rural land in the Balearic Islands.

This increase of 243%, is attached to a budget increase of more than 291%, according to data provided by the College of Architects of the Balearic Islands. The report makes clear that 90% of cases has arisen from the tenth transient disposal of the land law that allowed the legalization of constructions on rural land for a period of three years disposal. In 2015 passed from the illegality to the law 1,665 buildings, about 205.9 million euros.

The remaining percentage corresponds to the usual procedures of legalization of buildings, increasing the number of initialed works in the Balearic Islands 43.6% compared to 2014, with most of them in Mallorca. In 2015, housing construction represents 80% of the building activity, an increase of 16% of the projects. These data indicate that the construction business is beginning to grow strongly.

This fact is largely driven by the works of the tourism sector, which increased by 76% in 2015, from 109 million in 2014 move to 192 in 2015 in Mallorca. The projects which endorsed the College of Architects amounted to 971 million in one year, an increase of 49% over 2014, the report of the College of Architects. This progress is particularly striking in the tourist industry, both in Mallorca and the rest of the islands. In the Majorcan case, most of the money comes from the classic hotel companies, which rose from works worth 89 million in 2014 to mobilize 172.7 million in 2015. It also happened gradually in the interior hotels where construction injected 1.9 million euros. In the same way, it keeps rising the return on investment in luxury houses in Mallorca being more than 70% of the properties projected in 2015 luxury projects.

Please contact Ripoll & Mateu Solicitors Mallorca if you want to build a house in Mallorca and needs information about the current situation on urban planning regulations of the Balearic Islands.

The Government of the Balearic Islands approved in late 2015 a new tourist tax which record the growing tourist stay 16 years with an extra 0.25 to 2.0 euros per night.

The intention is that this tax is applied in hotels, guesthouses, tourist homes and on cruise ships calling at ports of the islands. The objective of the Government, with the application of the new rate is to raise between 70 and 80 million euros a year to protect the environment and ensure sustainable tourism. The new stable law a fee of two euros per night for five-star hotels and luxury holiday apartments. Tourists in four star hotels and apartments above three keys will pay 1.5 euros per night. In other hotels, tourist apartments and cruises a rate of one euro per night will apply, while hostels and campsites charged 0.5 euros per night.

This new law also provides exceptions to under 16, those traveling by force majeure, the staff of tourist accommodation, the displaced patients and their companions and users of social tourism programs.
The regional tourism department will conduct an information campaign, through tour operators, informing potential visitors and how much they will pay if they travel to the Balearic Islands. Both the Federation of Hotel Business such as the APTUR Mallorca as frontally opposes to the introduction of the tax and announced that they will fight the charge in court.

As refers to the rental property in Balearic Islands, Tourism Decree introduces some significant changes on rental villa or holiday rental in the Balearics. The main new features are two:

Inclusion of “villas” in the types accepted for holiday rental.

The forecast creating a list of “tourism marketing channels,” which will be available to users.

With the approval of the decree, there are three types of housing that can be used for tourist or vacation rental.
1. Detached house (one dwelling per parcel);
2. Paired Family houses (those that are on the same parcel subject to horizontal property regime or attached to the dividing wall that separates them)
3. Single house provided this be the only one in the plot.

Continue to be excluded from this law homes located in buildings, which may not be used for marketing as “touristic stays in houses”.

The Association of Tourist Apartments Islands, APTUR, requests the Government of the Balearic Islands that does not charge the ecotax to these accommodations until the offer has been all regulated. There are currently about 45,000 thousand homes in the Balearic Islands that are rented in high season and only 30% are discharged as tourist accommodation. APTUR will claim the Government to first rule all offer executive who first regulate all offer copper sector and then the tax. They request that you can rent directly from the owner or through an intermediary, who has a record of all the offer. The aim is to prevent the intrusion and become part of the tourism sector and promotion is done Islands as a destination.

If you have a property in Mallorca you want to rent during holiday periods or want to rent a villa for the summer on the island do not hesitate to contact Ripoll & Mateu, we will be gladly to inform and advise you at our offices in Palma and Pollença.

The improvement in the spanish real estate market is on the rise in the stock market, growing at a good pace both values linked to the property market as the sale of homes highlighting the surge in national and foreign investments.

Is clear that the Spanish real estate activity arouses a big interest between international investors. So much so that some of the SOCIMIs listed on the continuous market are among the companies with the best prospects for the Spanish market for this new year. Such companies have become fundamental pieces for the real estate sector in Spain, even to have a presence on the Ibex 35 from December 2015 through Merlin Properties.

The evolution experienced different forms of Socimi in Europe and the United States in recent years we foreshadow changes in the investment strategy of these vehicles in Spain ahead of the coming years, although they have not yet managed to match international figure REIT (Real Estate Investment Trust), fully consolidated in the European and North American markets. While we expect the legal reforms that allow the emergence of similar vehicles to Mortage-Reit and Hibrid-Reit, which will help to consolidate the revitalization of the debt market and provide greater flexibility to investors, raises the question of what the expected to grow in the coming years as traditional SOCIMI trend.

The forecasts for the year just released indicate that the Socimi to specialize in a single type of real estate assets, compared to current born with a vocation for diversification to exploit a situation of cyclical market in our country.This change in trend will not only greater sectoral specialization, it also bring about more uniform returns based on each type of real estate asset. All this generates a great interest from international investors, most often choose to channel their investments in the Spanish real estate sector through these companies, allowing them to assess the level of exposure to risks affecting each type of property assets independently.

At Ripoll & Mateu Solicitors Mallorca  we advise, defend and represent our clients at all levels using for this our greatest asset, an infrastructure of professional leaders in each field of action, highlighting the most powerful Real Estate like our specialty as well as our international vocation and multilingual capacity. With 30 years of experience in the development of legal practice in Mallorca and thanks to a constant process of renovation, internationalization and specialization Ripoll & Mateu has become a clear example of quality of service and ability to work.

Since the Real Estate sector of the Balearic Islands and based on the data with which is closed by 2015, it is expected that 2016 will be the year of stabilization in the market thanks to the new boom in housing construction and sustained increase in sales.

Similarly, 2016 begins with improvements in the housing sector such as increasing the number of mortgage loans and the housing price index in the third quarter of 2015, has experienced its biggest rally since 2007. Therefore, we echo the the recommendations to invest successfully in 2016 referred from the General Council of Associations of Real Estate Property Agents of Spain.

One of the main premises is to act slowly but surely, making a well-considered investment having clear ideas and valuing aspects such as the fact that according to the National Institute of Statistics, the price of housing has rebounded 4.5% the third quarter of 2015, and the revaluations trend will continue in 2016. Investment in residential housing is usually more profitable than investing in commercial property. The value of investment property changes depending on the location and extent of the land also should take into account that a larger and future exclusive property will generate more profits.

It’s essential to choose a good area with revaluation prospects. The location of housing is the key factor, it’s important to assess the expectations of rental or sale in the area, depending on whether the investment is long or short term. It is very important to consider aspects such as the number of bedrooms, the availability of lift and garage, the old housing, overall, guidance or sunlight it receives and if the area is quiet or noisy. A house in good condition, fully equipped and with good lighting is much more likely to be rented or sold.

Undoubtedly, as the financing is concerned, we are in an excellent time to get a mortgage loan on favorable terms due to low interest rates and mortgage unleashed war. Even so, it is essential to negotiate to get the best mortgage of the market. Prior to the signing of the purchase, it is advisable to go to the Land Registry in order to gather detailed information on housing as the ability to have outstanding charges and if these are reflected in the contract. Similarly, you can get information about mortgages from the housing responsive; if it is subject to foreclosures or affected by any litigious situation or any procedures under way for urban irregularity.

From Ripoll Mateu Solicitors Mallorca we also advice to check that the seller has no outstanding payments with the community and learn in advance about the costs of the community and the amount of property tax. Also, we remember that the buyer is entitled to review the contract of sale and, especially, the mortgage loan, a few days before signing.

If you are interested in investing in property in Mallorca please contact Ripoll & Mateu Solicitors, with offices in Palma and Pollença, we specialize in real estate law and work with the best banks and real estate on the island, we will be pleased to advise you.