Ibiza Property Prices 2017 – Special Report & Buyer Guide
Special Feature including …
- Latest Property Price Index Information
- Land Prices included
- Marketplace Comparison
- Long Term Price Index Report
Nick Gibbs, Editor
“There are three kinds of lies: lies, damned lies, and statistics.”
70% of people believe the quote attributable to Benjamin Disraeli, and 30% Mark Twain.
Of course I have made those numbers up. I have no idea how many people believe it was Disraeli or Twain. But it is a point worth making at the outset of any detailed statistic report. Thankfully Stephen Fry and Fake News have made us all a little more aware of fabricated facts, and though there is no intention to deliberately mislead anybody in this report, there are factors that make Property Pricing statistics in the Balearias particularly challenging.
The importance of this will depend on how you are viewing the numbers. If you are casually interested in property market trends you can probably afford to skip onto the graphs and key data. However if you are putting any level of importance on the numbers, particularly if you are looking to buy property as a non-resident, it is important you understand how the numbers are gathered and how they are typically presented – otherwise you will have a very slanted view of the market. Hence all of the preamble – it is admittedly dull, but important.
So the choice is yours, skip onto the graphs, or read the blurb first.
As useful as numbers are, if your interest is one of actually looking to buy a home I recommend you speak to local property agents as the only way to get the true on-the-street picture.
There are plenty to choose from, but I think many Ibiza residents would join me in warning caution if dealing with a barstool estate agent – i.e. an independent person without office premises.
I am sure there are honest and reputable among them, but it is a sector widely known for attracting a huge number of people who have no real experience in estate agency, but have very real desire to take money from outsiders. The cons are more prevalent in the rental market, but none the less, tread carefully.
Notes to Compilation
Ibestat released their updated 2017 price index figures this week.
Building on the work shown in the 2016 Property Special Feature, I have made effort to overcome the failings in the Ibestat data, pulling the numbers around in a way that best extracts what people actually want to know. Having taken economics with statistics at college I have always had a healthy mistrust of numerical data, and an affinity with the task of using data to find what is relevant and helpful.
I am confident I have published as accurate a reflection of the Ibiza property market as possible. I can take some confidence that my approach to achieving enhanced local statistics is the right one following the ‘coincidental’ publication of our refined 2016 statistics by the Spanish press last year. I can’t say for sure they were using ours, but until then they had used the information as supplied by Ibestat in its raw form, without the extended timelines and local municipality extracts.
Ibestat Data (& Data Limitations)
Data supplied by Ibestat, the Institute for Statistics in the Balearic Islands.
All euro figures apply to a price per square metre.
The property price index is shown back to the second quarter of 2005, when the current count method was adopted.
The Institute do not publish information on a per Island basis. Their method is to compile one Balearic wide average for house prices and another for land prices.
Given Ibiza’s price premium, and combined with being a much smaller island than Mallorca and so its influence on the price index being heavily diluted, the Balearic average may be considered significantly lower than the Ibiza average.
Despite this fundamental flaw in the way figures are gathered, it is still typically the way property pricing information is presented in the press and through national property portals. To the best of our knowledge there is no Ibiza Island or Formentera Price index.
However Ibestat do gather separate specialist statistics for all municipalities in the Balearics with a resident population of over 25,000. In Ibiza this applies to Ibiza Town (Eivissa) and Santa Eulalia only. These are focused on the size and age of properties, but do contain price index data.
By combining these two data sources we can get a much better view of the Ibiza property market. The result is still not perfect – it is based on 2/5ths of Ibiza, but it is a lot better than relying on Balearic averages – something reflected clearly in the results.
Mallorca and Menorca’s capitals are significantly lower than either Ibizan municipality – and were Ibiza’s remaining municipalities to be counted we are sure they would also be far closer to Ibiza Town and Santa Eulalia than the other islands.
That the Balearic average sits above Mallorca and Menorca further highlights the gravitational effect of Ibiza.
We also show some high/low points in each of the data sets – which bring into sharp focus the huge swings in property prices throughout the Balearics since 2005.
- Depending on the device you are using, you may be able to tap/click to enlarge graphs.
Latest Property Price Index Information
Current Price and Timeline to 2005
Highlighting the distorted view of relying upon figures for the Balearics grouped as a whole, the graph shows a relatively smooth line on the Balearic average, a line that is permanently and significantly below either Ibizan municipality.
The smooth progress of the Balearic average also masks a much more volatile picture by municipality.
Menorca is included for the first time, and anybody negatively affected by the ups and downs of Ibiza’s property sector should spare a thought for the freeholder folk of our most Easterly sister island.
We have also included Palma as representative of the Mallorca picture and so completing the cross-island comparison.
We have also included land – though this is only available on a Balearic wide basis.
High, Low Current
This graph highlights the huge swings in property prices. We should not forget that though it may feel expensive to buy in Ibiza, none of the individual municipalities or the Balearic average are yet back to their heights achieved pre-crisis – though both Ibiza boroughs are much closer than either Mallorca or Menorca.
Though still lagging way behind Ibiza in catching up to pre-crisis levels, Palma achieves a slightly higher annual increase than Ibiza this year.
Land was the highest riser overall – but these land value figures seem incredibly low to me anyway. If you are looking to build property I wouldn’t put too much store in them. I will try to find out more about what is included in time for a future report.
Long Term Price Index Report
The vast majority of property pricing reports are based on the period from 2005. The method of gathering the data was changed in 2005, and all Ibestat figures are released from that starting point.
Earlier figures are available for the main Balearic average going back to 1995. I decided to apply these earlier figures to get a longer term view – and a very interesting view it is at that.
A heavily inflated cost of living in Ibiza is seen as a very recent phenomena. All part of the trend toward VIP culture, and this has been particularly prevalent in the property rental sector.
As the graph clearly shows, it was actually in the late 90’s that property prices really took off. In the decade from 1995 to 2005 the Balearic property price index rose by 223%, 18 times greater than the 12% in the next decade.
Of course that second decade included the global financial crisis, but even so the growth in the decade from 1995 was remarkable. A good number of people reading this will remember 1995 – to jog your memories it was the year when Wonderwall and Gangsters Paradise were topping the charts. John Major was Prime Minister and Ebay was founded. It was also a year by when many of us had started our love affair with Ibiza.
Based on the Ibestat numbers, in 1995 the 3 bed apartment in our market comparison below would have cost you around 60,000€. But before ruing the benefit of hindsight, though an Ibiza apartment for 60,000€ sounds great, these things are all relative.
Though the Balearic increase 95-2005 was huge, and outstripped the UK by some 50 points, over the entire timeline the UK has been quicker to shrug off the effects of the crisis and is now ahead of the Balearics – by around 40 points. Taking into account Ibiza’s prices now being ahead of her Balearic sisters, those who have elected to keep UK property funding an Ibiza rental should be pretty much on parity over the duration – statistically that is, which takes me back to the very first sentence in this report – these are statistics, a guide, not gospel.
Not scientific, but as a reflection of whether the stats were borne out by available property, we used the popular idealista property portal to search using the following criteria – the Balearic average price index per square metre multiplied by 100 – so for the same price we should be able to get the most for our money in Menorca, followed by Mallorca, Santa Eulalia and the least specification in Ibiza Town.
Balearic Average is 2,108€ x 100 = 210,800. We searched 200,000 to 220,000.
Ciutadella de Menorca
We found a 5 bedroom flat for sale in camino del d’es degollador, 30, Ciutadella de Menorca at 210,000€ for 180m2.
The biggest in the range was 200m2 and overall there were plenty of 3 and 4 bed properties available available.
One that caught our eye – A 3 bed country ‘estate’ at 206,000€
Palma de Mallorca
With so many properties available we narrowed the search to those listed in the last month to give an equitable sample.
After a couple of renovation projects, the size of the properties did seem slightly lower than Menorca, the majority coming in at between 100 and 150 m2.
One that caught our eye – this 3 bed new build development at 212,000€
Well what a difference. The biggest available was just 98m2, and of the limited number available at that price, most were just 1 bed.
The average price of the selection was 3,522m2 – much higher than the Ibestat figure, but higher m2 prices may be expected at the lower end of the market.
Not so much a case of catching our eye as it is best of the bunch – this 2 bed 98m2 apartment
An average price of over 4,000€ per m2 and very slim pickings indeed.
Mainly 1 bed aparts and even studios around the 50-60 m2 size.
We did see this one 98m2 property in need of renovation
Buying a Property in Ibiza
If looking to buy a property in Spain, this downloadable report is a perfect place to start. Compiled by the British Royal Institute of Chartered Surveyors, it gives an excellent and unbiased overview of how the Spanish property market works, from funding to ownership, the legal process and taxes.
If you are interested in the property market in Ibiza you may also want to read our 2016 special feature
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