Property as a holiday rental in Mallorca: What you should know

A dream comes true: The story of the Meier family

The wind gently blows through the palm trees as the sun slowly sinks behind the horizon. The Meier family sits on their terrace and enjoys a glass of Spanish wine. A year ago they would never have dreamed that today they would be the owners of a holiday property in Mallorca - an investment that not only makes their own vacation unforgettable, but also represents an attractive source of income.

But the path to this goal was associated with many questions: What legal aspects need to be considered? How does licensing work? And is holiday rental in Mallorca even worthwhile? We will answer these questions in this article - in a practical and understandable way.

Why rent a holiday property in Mallorca?

Mallorca is one of the most popular travel destinations in Europe. Millions of tourists flock to the island every year - and the trend is increasing. A holiday property can therefore be a lucrative investment.

Advantages of holiday rentals

✅ High demand: Tourists from Germany, Great Britain and Scandinavia ensure a consistently high booking rate.✅ Attractive returns: A well-marketed property can generate high rental income and finance itself in the long term.✅ Own use: You can enjoy your property even in the low season, while it generates income in the high season.✅ Increase in value: The property market in Mallorca is stable - properties in good locations are continually increasing in value.✅ Inflation protection: Tangible assets such as real estate offer protection against inflation.

However, not every property is automatically suitable for holiday rentals. There are clear requirements for location, equipment and licensing.

Which properties are suitable for holiday rentals?

Not every property can be rented out as a tourist property without further ado. The decisive factors are:

Location

🏖 Proximity to the beach: Properties near the coast or with a sea view generate higher rental income.🌄 Quiet locations: In the interior of the island, fincas are particularly popular with long-term holidaymakers.🚗 Good infrastructure: Shopping facilities, restaurants and transport links increase the attractiveness.

Facilities

✔ Modern furnishings: High-quality furniture and well-thought-out interior design are a must.🏊 Extras such as a pool or garden: These make your property particularly popular.📶 Good WiFi connection: Indispensable for many guests.

Type of property

🏡 Single-family homes & fincas: Ideal for families and groups.🏢 Apartments in holiday complexes: Often with communal pools and security, but not always approved.

Legal basis: What must be observed?

Holiday rentals on Mallorca are subject to strict regulations. An official license is mandatory, otherwise there is a risk of high fines.

Licensing for holiday rentals

To legally rent out your property, you need an ETV (Estancia Turística en Viviendas) license. This is issued by the Balearic government. Important aspects:

Aspect

Details

Types of license

Holiday apartments (ETV) and single-family homes (ETV-Pluri) have different requirements.

Maximum number of guests

Depending on the license, only a limited number of guests can be accommodated.

Energy certificate

Must be available for the application.

Minimum standards

Facilities, safety and hygiene regulations must be complied with.

Zoning

Not all regions of Mallorca allow holiday rentals.

Typical errors when applying for a license

❌ Missing documents: A complete application is essential.❌ Unsuitable property: Not every property receives a license - a prior check is advisable.❌ Regional restrictions: Check whether holiday rentals are permitted before purchasing.

Tax aspects and revenue optimization

Income from holiday rentals is subject to tax. There are differences between residents and non-residents.

Tax obligations for non-residents

💰 Income tax: 19% for EU citizens, 24% for non-EU citizens.💰 Value added tax (IVA): In some cases, 10% IVA applies.💰 Tourist tax (Ecotasa): Must be collected and paid by the guest.

Tips for tax optimization

Use tax allowances and deductibles.

Hire a local tax advisor to comply with all regulations.

Document all income and expenses for a transparent tax return.

Successful marketing of the holiday property

The competition on Mallorca is fierce. With the right strategies, you can rent out your property profitably.