The Balearic Islands closed 2022 in the midst of a perfect real estate storm: with a combination of exorbitant prices, salaries lower than the Spanish average and the most expensive interest rates in all of Spain. Rents are unaffordable for the majority of citizens, who are forced to share a house and, those who were able to buy a home, had to pay the highest mortgage in history: 1,097.9 euros per month on average, the most expensive figure in the entire state. These are statistical data that the Association of Property Registrars has made public a few days ago. The average Spanish mortgage is 646.7 euros, so the citizens of the Balearic Islands pay 70% more mortgages for the purchase of their flats than the Spanish average.
Those 1,097 euros on average paid by a citizen of the Balearic Islands are almost triple what one from Extremadura pays for your mortgage (397 euros) and double that of many autonomous communities, such as Andalusia, Aragon, Navarra or the Canary Islands, which are around 500 euros on average. In just five years, the total average mortgages in the Balearic Islands have gone from being 152,429 euros to buy a flat to 236,166 euros. In other words, in barely five years, the mortgage has grown by 55% in a figure equivalent to what the price of housing has skyrocketed. In Madrid, the community with the second most expensive mortgages, the increase has been 23%.
But, as if that were not enough to certify that housing is the big problem that citizens now have, we still have to add more fuel to the fire because the Balearic Islands closed 2022 with another very relevant statistical data: it was the autonomous community where the most expensive are interest rates. The new mortgages were signed at a average interest rate of 2.92% and Galicia is the only community that is slightly close to the Balearic Islands, with average interest rates of 2.74%. The Spanish average is 2.55% and the consequence of all this is that, from the outset, those with mortgages from the Islands pay their bank loans 15% more than that of an average citizen of any other autonomous community.
The luxury of buying a flat in the Balearic Islands.
The statistics of the Association of Registrars do not leave you indifferent, however you look at the data, if the focus is placed on the Islands. Each citizen of the Balearic Islands must allocate 56% of the salary cost to pay their mortgage, a figure that had not been seen until now. No community even comes close. There is none that reaches 40% on average and the only one that comes close is Madrid, where citizens allocate 38% of their salary cost to the mortgage.
And in the midst of this bleak panorama with regard to housing in the Islands, there is a data from the Association of Registrars that is also extremely striking: 36% of all real estate transactions they were made by hand, without the need to apply for a mortgage to pay for the house. Interestingly, it is almost the same percentage of the number of foreigners who bought a home on the Islands: 32% of all the transactions that were made. Many of these sales close among themselves: both the seller and the buyer are foreigners.
