Benjamin Dau, CEO of Mayer & Dau Immobilien, with offices in Alcúdia, Cala Ratjada and Santa Ponsa, provides a well-founded overview of the development of the land market on Mallorca during the first six months of 2025.
His analysis shows: The demand for building plots remains high – especially in the island’s premium locations – while supply is increasingly under pressure.
Prices continue to rise – especially in top locations
In the first half of 2025, the average price per square metre on Mallorca climbed to around €4,410 – an increase of over 10% compared to the previous year. Plots in Son Vida, Santa Ponsa, Port Andratx and Cala Ratjada are particularly sought after, with prices in some of these areas having more than doubled in recent years.
“There continues to be a significant number of serious buyers looking for absolute prime locations on Mallorca,” explains Benjamin Dau.
“At the same time, we are seeing increasing interest in the north and northeast of the island, including regions such as Alcúdia, Artà and Capdepera – not least because entry prices here are often significantly lower compared to the southwest.”
International buyers dominate the market
The market remains driven by strong international demand. Buyers from Germany, Scandinavia, the UK, Belgium and France in particular are investing on the island. In the high-end price segment, cash buyers dominate, while financed purchases are more common in the mid-range.
“Mallorca remains a dream destination – and in times of crisis, a safe haven for capital,” says Dau.
Limited supply: building becomes a challenge
Buildable land is scarce on Mallorca. Complicated permitting processes, limited new development areas and strict construction regulations make project development difficult. This further drives up prices – especially for plots with valid licenses or existing building rights.
“Plots with approved building plans are practically sold immediately,” Dau emphasizes.
“Owning such a property today means holding a valuable asset.”
Rural fincas and inland locations gain relevance
Beyond the coastal regions, rural areas such as Alaró, Santa Maria or Bunyola are gaining traction. Investors here combine privacy with a connection to nature – and often benefit from lower entry prices. Sustainability is also playing an increasingly important role, especially in new builds with energy efficiency and solar technology.
Rental market: strong demand across all segments
Rental demand has risen significantly across the island – both in the high-end premium sector and in the traditional residential segment. Single-family homes, villas and modern apartments are particularly in demand, both for long-term rentals and seasonal use.
“The rental market is extremely tight. Anyone looking to rent a well-located house or villa on Mallorca faces virtually no vacancy,” Dau explains.
“In many cases, demand even exceeds the available supply.”
Average rental prices per square metre rose by around 13% in the first half of 2025 – particularly in Palma and in sought-after coastal areas.
Tax discussions create uncertainty
A political debate regarding a potential additional tax on property purchases by foreigners has drawn international attention.
While the discussion is causing uncertainty for some buyers, such a law – in its currently discussed form – is widely seen as unrealistic.
“From our point of view, this proposal is incompatible with both European law and the economic reality on Mallorca,” says Benjamin Dau.
Outlook for the second half of the year
Forecasts remain positive:
Further price increases of 5–10% are likely
Demand will remain high – supply remains limited
Plots with development potential and building permits will become even more desirable
The north and northeast may continue catching up in 2025 – particularly for buyers with a long-term perspective
“Nevertheless, we are closely monitoring developments and are here to advise our clients every step of the way.”
Conclusion from Benjamin Dau
“Those who invest in land on Mallorca do so not only for the lifestyle, but also as a strategic capital investment. The supply will continue to decline in the medium term, while international demand remains strong. For investors, now is the right time to act – with foresight and local partners.”
