Officials in Majorca have earmarked land for homes to be built exclusively for middle class renters in a bid to help tackle the island’s housing affordability crisis.
In total, 363 new properties are to be built as part of a local government-backed scheme aimed at boosting the availability of homes for rent below market rates.
The full details have yet to be thrashed out, according to local media, but the authorities in Palma anticipate the introduction of a register for applicants which would prioritise some over others.
What has been made clear is that the new homes won’t be for social housing tenants, but aimed at middle class renters who earn more than the threshold set for social housing but not enough to afford market rates. This will likely spark fury as locals are already being priced out on the popular holiday island.
Majorca Daily Bulletin reports that at the moment developers would select applicants whose incomes mean they are guaranteed to make their rent payments.
But officials have said this isn’t a binding proposal and the final selection method has yet to be confirmed.
Six plots which make up the scheme are valued at 5.5 million euros (£4.56m), according to the same publication, with local government tipped to save building costs of about 37m euros (£30.7m).
Instead such costs will be covered by developers, who will manage the new builds and bear the operating costs.
Demand for housing across the Balearic Islands has been tipped to accelerate, while supply has been described as limited by one mortgage broker.
Ricard Garriga, Chief Executive at Trioteca, estimated in September that property prices across the islands would rise 8% by the end of this year.
He said demand pressures and supply shortages would make the increase “inevitable”.
The population of the Balearic Islands has increased by 50% since 1996 as newcomers are drawn to the archipelago’s beaches and sunny weather.
Meanwhile, just one of the six plots which form part of the Majorcan scheme is expected to generate a staggering gross income somewhere in the region of 61m euros (£50.6m).
However, not everyone appears pleased at the idea, with one commenter issuing a warning to “working class” Majorcans.
The unnamed person wrote in the comments section of Majorca Daily Bulletin: “If Mallorcians think this a fair way to allocate rented property then they should hang their heads in shame. This will become the norm throughout [Majorca] when such building land becomes available.
“So if you are low income and what the developers say [is] working class then tough, get a sleeping bag.”
