They earn much more and buy flats here: the European middle class is gaining ground on the islanders

PalmaIn Frankfurt, people earn more than double what they do in Palma, but buying a square meter in the center only costs 24% more. In Amsterdam, salaries are 128% higher than in the Balearic capital, while housing is 61% more expensive. And in Brussels, the difference is even more striking: salaries exceed those of Palma by 59%, even though the square meter in the center is 27% cheaper.

The comparison, based on data from the international collaborative database Numbeo, helps us understand that islanders are competing to buy their homes with incomes generated in the richest economies in Europe. And it is not marginal competition. In the second quarter of this year, 32.27% of home sales in the Islands involved a foreign buyer, the highest proportion in the entire State. In 2025, it had already been 29.86%.

In short, apartments have European prices, but salaries remain Balearic. The INE places the average salary in the Islands at 29,075 gross euros per year. It increased by 5.6% in one year, more than the national average. The problem is not that salaries are not advancing, but that they have to compete with a real estate market that stopped responding to the residents' purchasing power a long time ago.

You don't need to be rich

For decades, the foreign buyer of a house in Mallorca or Ibiza was identified with a great fortune that could pay prices out of reach for residents. But the salary gap enormously widens the profile of the buyer who is taking over apartments in areas such as Santa Catalina and the old town of Palma: you no longer need to be rich in Northern Europe to arrive in the Balearic Islands with a purchasing power much higher than the local one.

A middle-class family from Frankfurt may not consider themselves especially wealthy in Germany. But Numbeo data places the city's average net salary 105% above that of Palma, while the square meter in the center is only 24% more expensive. In Amsterdam, the salary difference is 128% and the real estate one is 61%. In Brussels, the situation is even more peculiar: one earns 59% more and buying in the center costs 27% less than in Palma.

This does not mean that “any German, Belgian, or Dutch worker can buy a home in Mallorca,” explains independent real estate advisor Chris George. “But it is no secret that there are millions of people from the north who are better positioned in the face of such high prices,” he explains.

Numbeo collects data collaboratively and allows for the comparison of salaries and prices between different cities using the same methodology. Meanwhile, the square meter continues to climb. Registrars place the Balearic Islands at 4,311 euros per square meter on average during the second quarter, the second most expensive region, only behind Madrid. Palma reaches 4,291 euros.

The Balearic housing market has become Europeanized. Salaries have not. Juan Monserrat is 36 years old, has a child, and has a job. He earns 1,800 euros in 14 payments. After separating, he had to return to live at his parents' house. His ex-wife remains in the apartment they had bought together and both continue to pay the mortgage on it. Now they are trying to reach an agreement to sell it and split whatever remains after paying off the outstanding mortgage. “With what we get, we will be able to have a small place. But, of course, we have a mortgage of 260,000 euros,” he explains.

He does not know what he will be able to buy with the part that finally remains for him. “Right now I see everything as bleak. And both of us are working.”

Unions have long been warning about this distance between good labor data and the real capacity to build a life project. José Luis García, general secretary of CCOO of the Balearic Islands, warned a few weeks ago that the good employment situation coexists with an escalation of prices, especially of housing, which “prevents salary increases from translating into an equivalent improvement for workers.”

CCOO has tried to quantify this difference. A study commissioned by the union to the Intercoopera Foundation places the reference salary necessary to cover daily needs in the Balearic Islands at 2,260.47 gross euros per month in 14 payments. The figure rises to 2,996 euros in Ibiza. Once again, figures well above reality.

Wages are rising

There is a reality that forces us to qualify the diagnosis: Balearic salaries are indeed rising. And some of the most important increases have occurred precisely in the main sector of the Islands. The hospitality agreement provides for a cumulative salary increase of 13.5% over three years: 6% between April 2025 and March 2026, 4% during the second year, and 3.5% during the third. The lowest salary in the sector exceeded 1,946 gross euros per month during the first year.

José García Relucio, Secretary General of the UGT Services Federation, described the agreement as “historic.” The agreement affects more than 180,000 workers and constitutes one of the most significant salary increases achieved in recent years in the Islands. CCOO did not sign it. The union considers the 13.5% insufficient given the high cost of living in the Balearic Islands and criticizes that the agreement does not incorporate a salary guarantee clause and entails setbacks in other rights.

The discrepancy between the two unions highlights the same reality: the salary battle exists and payrolls are increasing, but they do so chasing prices pressured by a demand with much greater purchasing power.

The Secretary General of UGT in the Islands, Pedro Homar, summarized it this August after a new employment record: “There had never been so many people working and so few unemployed, but it had never been so difficult to access housing and become independent.” According to the union, renting an 80 m2 apartment is equivalent to 85% of the average net Balearic salary.

Three salaries and sleeping in the dining room

Ana Cristina's story shows another side of the problem, that of migrant workers who sustain an important part of the service sector while also facing the high cost of housing. She is 26 years old, is from Ecuador, and has been living in Mallorca for six years. She works in a restaurant in the Illetes area and shares a small apartment with her sister, a cousin, and her sister's two children. "There are five of us in a small apartment. I sleep in the dining room," she explains.

There are three salaries in the house. They are not enough, however, to consider another way of living. "Three salaries come into the house and not a single euro is left at the end of the month. We help each other a lot." For Ana Cristina, the consequences go beyond not being able to save. "I am 26 years old and the truth is that it sounds bad, but I can't even have privacy at home. It is what it is."

When she arrived on the island, the situation she imagined was different. "I have been in Mallorca for six years and it is true that I expected something else. But in my country right now we don't have opportunities." This is not an anecdotal reality. Carmen Carmona, head of Union Action for the CCOO Services Federation in the Balearic Islands, warned just a few days ago that there are companies that go as far as using accommodation to attract seasonal workers. The union has detected cases of four workers sharing a room or accommodations without windows, while the difficulties in finding a home are intertwined with working conditions. The Balearic Islands need workers to sustain record economic activity, but they increasingly have more difficulties for these same workers to be able to live there.