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Ibiza is experiencing its most severe real estate crisis, with rent becoming a luxury commodity.

by Investor Noob
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At a hotel in Ibiza, guests from around the world dance under the lights reflecting in the pool during another lively party night. Despite the high costs, everyone agrees that the experience is invaluable.

A real estate crisis in Ibiza has led to residents and seasonal workers having to share small apartments, leave the island, or live in tents and motorhomes in unauthorized camps.

Ibiza’s challenges mirror a broader problem in Spain, where protests have erupted due to the unavailability of affordable housing, with demands for rent control and opposition to overtourism. Critics claim that property owners prioritize short-term tourist rentals over less lucrative long-term agreements.

In Ibiza, around 800 individuals were found living in makeshift shelters, as reported by local authorities. This figure does not account for the approximately 200 individuals who were living in temporary accommodations at the “Can Rovi 2” camp before being relocated last month.

Jeronimo Diana, a 50-year-old Argentine water technician who stayed at Can Rovi 2, described the island as a stunning paradise with a hidden dark side.

Diana mentioned that a typical monthly rent would consume a significant portion of his 1,800 euros salary.

The average rental prices in Ibiza hit a record high of 33.7 euros (approximately R$ 212.6) per square meter in July of the previous year, showing a 23% rise from July 2023, as reported by data from the Idealist real estate website.

This equals approximately 1,500 euros for a small one-bedroom apartment.

The minimum wage in Spain is 1,381 euros monthly.

Getty Images photograph

Imagem: astrovariable/ShutterStock

Teachers are absent in Ibiza.

Ibiza is experiencing an increasing lack of teachers and healthcare workers, potentially due to a domino effect as public employees are transferring from nearby regions like Baleares, Menorca, and Majorca.

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Maria José Tejero, a 24-year-old medical emergency technician, mentioned that she shares a small apartment with two colleagues in order to make ends meet, as the rent is equivalent to twice her salary.

Working night shifts as an ambulance aid can make you feel like a caretaker, as people often come in intoxicated or under the influence of drugs, behaving as if life is just a never-ending party without considering its fragility.

In the bustling tourist town of Sant Antoni, the streets are littered with balloons filled with nitrous oxide, a gas known for its temporary euphoric effects, being sold for 5 euros each.

Lia Romero, a 28-year-old nurse from the Canary Islands, Spain, occasionally works as a dancer at the Amnesia nightclub in Ibiza. She shares an apartment and cannot afford the cover charge or dining out.

Ibiza is known for showing off and excluding regular people.

Tourists are increasing in number.

Ibiza welcomed 3.28 million tourists in 2024, as reported by the local statistical institute.

76% of this amount is from Spain, as the island’s population reached a record high of 161,485.

Jonathan Ariza, a mechanic and construction worker, who stated he was seeking political asylum in Spain, resides in a trailer close to the island’s primary hospital. He mentioned that as long as tourists keep coming, individuals will be ready to endure poor living conditions for employment opportunities.

Alejandra, a 31-year-old Colombian resident with a permit, resides in a Caritas shelter after being unable to secure rental accommodation. She mentioned that she and her 3-year-old son David slept in a tent before seeking help.

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She mentioned obtaining a new position at a hotel and expressed a desire to move out of the shelter. However, she was hesitant to do so as she feared losing her job due to her perceived slowness in handling the necessary paperwork for renewing her authorization.

The Caritas shelter reported that they frequently show bias against families with children and evict tenants in order to accommodate tourists during the lucrative summer season.

Local officials are cracking down on illegal vacation rentals, with fines starting at 40,001 euros for violators.

Rental properties for seasonal use will be automatically removed if deemed illegal by authorities, instead of waiting for a lengthy court ruling, stated Mariano Juan, Vice President of the Council of Ibiza from the conservative People’s Party governing the Balearic region.

Juan believes that the high demand and limited availability of land for building in Ibiza lead to rental prices that are “completely illogical.”

Imagem de uma rua comercial em Ibiza, na Espanha, à noite, cheia de pessoas na rua
Imagem: stephmcblack/FreeImages

Government authority

In Spain, the leftist government vowed to triple the state housing budget and speed up the building of social housing.

A law implemented in 2023 to impose certain rental regulations has not been very effective due to the opposition-controlled regions refusing to comply with the regulations, citing their significant autonomy in housing policy.

ASVAL, the national organization representing property owners, opposes rent controls, claiming they limit supply and drive up prices. Instead, ASVAL suggests that public incentives and increased construction are more effective in lowering rents.

Saray Benito, aged 32, mentioned that finding work as a contortionist and juggler performing with torches at Café del Sea is difficult during the winter season. During her 12 years in Ibiza, she revealed that she had to change her residence 20 times and occasionally had to sleep on balconies.

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The high expenses of transportation and accommodation are preventing other artists from visiting the LGBTQ+ community of La Virgen near the port of Ibiza city, according to the well-known Italian drag queen Eva Cavallini. She expressed concern that if the situation persists, the island will suffer.

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