Why you should Invest in a Property in Ibiza

Historically, investing in real estate has proven to be a steadfast choice. Undoubtedly, there are myriad factors and variables to consider. However, one thing is unequivocal: your prospects of attaining a substantial return on investment are significantly enhanced when acquiring property in a location of high value and desirability.

For quite some time now, Ibiza has stood as a secure choice for real estate investments, primarily due to its idyllic location and sustained high demand for properties. Whether you’re seeking a second home or a villa for tourist rentals, whether you’re interested in a renovation project or a property in the early development phase, as the current market stands, purchasing a home in Ibiza promises a secure future capital return.

Keep reading to discover why we hold an optimistic outlook for the Ibiza real estate market and the investment opportunities it presents.

Why Invest in Real Estate in Ibiza – The General Real Estate Market

Over the past decade, both property sales and real estate prices in the Balearic Islands have exhibited a consistent and stable upward trajectory. It wasn’t until late 2019 and early 2020 that real estate prices and sales began to decline, marking the first such decline since the onset of the financial crisis in 2007. This hinted at the initiation of a mild stagnation, which later intensified due to the circumstances surrounding COVID-19.

Real Estate Market in the Balearic Islands – Price Trends

However, from the beginning of 2020 to the end of 2021, we witnessed a rapid resurgence in buyer activity, leading to an overall increase in property sales across the entire Balearic Islands. On Ibiza, it became abundantly clear, as demonstrated in our year-end 2021 real estate market report, that there was a surge in numbers and growth in the international second-home property market. People’s priorities shifted due to COVID-19, and the allure of living amidst natural beauty, away from urban centers, became increasingly appealing.

The high-end real estate market on Ibiza continues to magnetize second-home buyers. While the initial surge in sales experienced in 2021 has slightly moderated with the waning of the post-pandemic effect, the fact remains that the demand for real estate significantly outpaces the number of sellers in the market, leading to a robust and unwavering price curve.

Purchasing Property in Ibiza with a Tourist Rental License

In Ibiza, many individuals aspire to buy a villa for the purpose of renting it out to tourists. However, it’s not as straightforward as one might assume. Not every property in Ibiza can be legally rented out to tourists for short breaks. Those who wish to proceed with property rental require a definitive tourist license. Each application for a tourist license must meet a stringent set of requirements. We will provide more information on obtaining a rental license in Ibiza, including the current legal prerequisites and application procedures, in an upcoming blog post.

Discovering a property in Ibiza with a current tourist license is more than advantageous. All the application procedures have already been completed, and the legal certificate is in place. Moreover, there’s likely an existing customer base within the tourism industry, eager to return year after year to book their vacations at the same accommodation. This is in addition to the convenience of potentially already having a professional real estate agent and management team in place, excelling in their roles.

It’s essential to note that renting out your property without this license can incur substantial penalties. Legal rentals in Ibiza are typically allowed only for durations of 30 days or more.

If you’re on the hunt for an exceptional property boasting a rental license, consider exploring this elegantly refurbished and contemporarily upgraded 6-bedroom residence nestled in a serene and secluded locale. This home enjoys an ideal position, mere minutes’ stroll from the picturesque Cala Salada beach, celebrated for its family-friendly atmosphere. What sets this property apart is its pre-certified definitive rental license, elevating it to the pinnacle of investment opportunities.

Alternatively, we have another great property with a tourist license that offers an attractive investment opportunity in Ibiza. Only 5 km from the beautiful beach of Talamanca. This property comes fully furnished and has amazing sea views. An excellent investment opportunity. In a 24-hour location of Can Furnet.

Acquiring an Authentic Property in Ibiza for a Renovation Project

Finding older, authentic properties in Ibiza ripe for renovation and resale with a promising return on investment is becoming increasingly challenging. A few years ago, this was a fantastic option due to the availability of many more properties. Now, locating such properties with the potential to transform into a modern boutique-style home while securing a decent return has become more elusive. However, it remains possible with the assistance and expertise of a proficient real estate agent well-acquainted with the market and capable of recommending the right construction teams for such endeavors.

Casa Salinas stands as an exceptional traditional Ibiza finca, complete with a guest apartment. It represents an outstanding real estate investment opportunity for renovation, holding the potential to evolve into a beautifully modern yet authentically Ibiza-style residence. Situated in Ses Salinas amid breathtaking landscapes, this picturesque setting offers a wonderful canvas for a renovation project.

Investing in an off-plan or project phase apartment in Portinatx

Buying a property in Ibiza during the off-plan or project phase is an interesting option. This option allows you to purchase an apartment that is either not yet built or is still in the development phase. In addition, this type of property can be resold with a certain profit margin or rented out on a long-term basis, excluding short-term vacation rentals. As mentioned above, obtaining a tourism license is subject to strict conditions and new developments must wait 5 years before they can apply for a tourist rental license. Even after this period, it can still prove to be a difficult undertaking. What is not possible with apartments is that they can only be rented for the long term, at least 11 months.

Purchasing Property in Ibiza as an Investment

Ibiza, in general, serves as an excellent market for investment, known for its stability and security, particularly for long-term investments and the consistent appreciation of property values. There are often truly remarkable investment opportunities here. However, given that demand typically outstrips supply, when the perfect investment property is not yet on the market, it’s highly advisable to proactively engage with the right real estate agent as early as possible. This way, when the ideal investment property that aligns with your personal requirements becomes available, you can initiate the process promptly.

Are you interested in purchasing a property here in Ibiza?

Chat with one of our agents to discover the perfect real estate investment that suits your needs! We look forward to hearing from you!

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