Investment Property
The Brief
- Clients looking to sell their rental property portfolio in the Netherlands to reinvest in Mallorca
- Any property needing renovation/upgrading, in the right location to attract buyers for resale
- Any location on the island
The challenges
The clients were interested to explore character fincas for renovation, sending various properties found online. However, rustic properties come with their own challenges – mainly illegality, as owners add structures over time without a licence, eg. converting agricultural sheds into living space. There are other issues such as rights of way & lack of mains services, with reliance on water deliveries – not a problem in itself in Mallorca but holding tanks or deposits need consideration. There may be a registered well but pumps need maintenance, as do boundary fences, walls or hedges to neighbouring fincas or roads. This all adds to the upkeep, together with the responsibility for the land itself.
There will be buyers for this type of property but your market will be wider if you concentrate on second home buyers on the hunt for an easier, lock-up-&-leave option on a manageable, urban plot.
The search
We advised a new build for the best return. You will pay a premium for any plot which already has a licence as the application process can take more than 18 months, often longer depending on municipality. However, the clients were prepared to wait.
There are many urbanisations in Mallorca where plots may be for sale but new licences have been suspended until councils are able to improve infrastructure, supplying mains water, drainage, street lighting & so on. The legal situation is complex & raising funds to do so usually falls on existing residents so you could wait for years.
Competition is fierce from developers but we showed the clients three areas with potential to attract both resident & overseas buyers. We identified the best plots for sale there in terms of views, orientation, access & ease of construction, all suitable for either a detached villa or luxury townhouses. We also introduced two independent, experienced project managers able to advise on costs.
The Result
The clients bought two urban plots for detached houses with a pool – one in a great spot on the edge of Campanet village & the other within 5 minutes’ walk to the heart of Valldemossa, with absolutely stunning, panoramic views. It was for sale by the previous owners of the neighbouring villa (also bought by clients of ProMallorca!)
Other Case Studies
THE PUERTO ANDRATX PUZZLE
- Client looking for a holiday property with three bedrooms, pool & AAA sea view
- The only location in consideration was Puerto Andratx
- Prepared for minor renovation work
Plot For Construction
- A flat plot of 650 – 1,200 m2 for construction of a detached 4 bedroom property with pool
- Preferred area Camp de Mar – Andratx (SW Mallorca)
- To be used initially as a holiday home, then sold within 2-3 years