This is 50 per cent lower than the first half of 2012 and is just three per cent of the 1,501 housing units given the green light during the height of the 2006 boom. While this will serve to drive prices upwards, once the market recovers there could be a mad rush to create properties to match demand. Yet not everyone is concerned about the lack of construction.
Daniel Chavarria Waschke, managing director of Balearics Sotheby’s International Realty with offices in Mallorca and Ibiza, said: "The crazy building frenzy of the peak is over, partly because bank lending is virtually nonexistent and partly because attitudes have changed towards construction. Many people are choosing to refurbish existing homes rather than build from scratch and unnecessarily urbanise more of the landscape. This is very healthy in my opinion and will help preserve the Island’s natural beauty and desirability."
Figures from the Balearics College of Architects show that up to July 2013, of the 250 projects approved in Mallorca, Menorca, Ibiza and Formentera, 70 per cent were refurbishments. This is up 30 percentage points from the 40 per cent ratio of refurbishments recorded in 2012. There are reasons to suggest this is proving to be a positive thing for the construction sector too, with fewer companies going bust. In fact, many are reporting new enquiries and income streams.
New demographics are also entering the property market, creating opportunities for builders. Research from estate agents Lucas Fox recently revealed more 30 to 40-year-old buyers are snapping up property in Ibiza, keeping prices buoyant on the island. Many are attracted by the glamorous vibe of the area and its proximity to other Spanish locations.