Housing affordability has become a central issue in the Balearic Islands, where the shortage has worsened over roughly a decade and made it harder for residents, public services and the tourism sector to find affordable homes. Since taking office in 2023, the government of regional president Marga Prohens has sought to increase supply through planning changes, construction and tax incentives rather than rent caps or declaring high-pressure housing zones.
The strategy includes limited-price homes, the release of additional land for residential development and tax measures that benefit homebuyers and property owners. The government has also announced the removal of regional taxes for people under 36 buying their first home, although that proposal had not yet been implemented in the account provided. Prohens has separately pledged to direct resources from the Sustainable Tourism Tax towards housing needs.
The government says it has more than 10,000 affordable homes in different stages of development or planning for people who have lived in the islands for at least five years. But many are not yet available. The figure includes projects at very different stages, while 4,400 homes are described as being processed under the 2024 Emergency Housing Law and the Construir per Llogar programme.
A plan to expand public rental housing through the Balearic Housing Institute has also yet to move several major developments into formal processing. The government presented 47 developments comprising 1,213 homes, with a planned investment of €228 million. It says that 41 projects, involving more than 950 planned homes, have been designated as projects of regional interest, but these have not yet been completed.
The Lloguer Segur programme has fallen well short of its initial target. It was intended to bring 3,000 vacant homes owned by small landlords into the rental market, offering them to eligible residents at 30% below the rent assessed by the administration. By June 2026 it had secured 92 properties, with 20 more added in subsequent months, bringing the total to 112.
The government has also created a framework for strategic residential projects, intended to unlock land and accelerate construction. The plans envisage 8,000 homes, of which the administration says 4,000 will be limited-price or protected housing. However, the law does not set a minimum share for those categories. Former regional housing official Eduard Vila has criticised the government’s targets as inflated and argued that some measures amount to privatising land. He also questioned delays and the conditions for building protected housing.
Tax incentives remain a key part of the government’s approach. Measures that took effect on June 14, 2026, raised the maximum property price eligible for certain transfer-tax benefits, lowered taxes on limited-price homes and introduced a deduction for landlords who freeze rents. A separate law adopted that month aimed to speed up protected housing construction by simplifying procedures and changing requirements for public developments.
The government has continued to oppose using the state’s mechanism for limiting rents. On October 6, the regional parliament rejected a Socialist proposal that would have allowed municipalities and the housing institute to begin procedures for declaring areas of stressed housing markets when legal conditions were met. The proposal was defeated by 33 votes to 24, with the PP and Vox voting against it.
The rejected measure would have opened the way to rent-containment rules in qualifying areas. The regional government is now considering a legal challenge to the national government’s decision to exclude regions that have not adopted rent limits from €180 million in subsidies. Prohens’ administration has described that decision as discriminatory.
Sources: elDiario.es.