Therefore, the Balearics, along with 16 other regions, such as Andalusia, Asturias, the Canary Islands, Valencia, Extremadura, Madrid, Navarre and the Basque Country, have exceeded that ceiling. Thus, the national average registers a rise of 9 percent in 2024 compared to the same period in 2023, reaching 12.65 euros per square metre per month.
Among the 48 provincial capitals analysed, Palma is one of the eight cities that has not reached this maximum price in 2024 due to the fact that the cost was 17.98 euros/m2 in May, which means that the historical figure of 18.71 euros/m2 has not yet been exceeded. The Director of Studies and spokesperson for Fotocasa, María Matos, explained that the rental market “continues at record highs and with record prices in most autonomous regions and in practically all provincial capitals”.
She described this price comparison as “an alarming situation”, as there are some autonomous regions where the increase is “30, 40 or 60 percent above the price shown during the 2007 bubble, and the trend continues to rise”. The situation has been attributed to the increase in demand at a time when the supply “is contracting sharply”, causing the reduction of properties in the real estate market. “We have never seen such a significant rise in prices as in the last two years,” she concluded.
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Can you blame property owners wanting to rent for charging high? The risk of squatters taking over is high and the law that protects their rights to squat is enforced. So if a property owner is going to take the risk of renting they need to ensure the rental is super profitable to cover the potential downside. Also by charging a high rent they are more likely to attract a market that wants the property for short periods and is not intending to stay on illegally. The Government have only themselves to blame on this one.