Buy and Rent Out a Holiday Home in Mallorca – Guide 2025

Why Mallorca is Ideal for Holiday Rentals

Mallorca remains one of the most sought-after destinations in Europe, attracting millions of tourists annually. The island's diverse landscape, cultural richness and year-round appeal make it a prime location for investing in a holiday property with high rental potential.

Rental Licenses and Legal Framework

To legally rent out a property to holiday guests, a rental license (ETV or similar) is required. Zoning laws vary by municipality. Properties in touristic zones have a better chance of approval. Avoid urbanizations with license bans.

Buying the Right Property

Key factors include location, proximity to beaches or popular spots, amenities like pools, and property condition. Sea view properties or countryside fincas with charm tend to perform better.

Rental Income and ROI Potential

Depending on size and location, well-located holiday homes can generate gross annual returns of 5–8%. Professional marketing and occupancy management are essential to reach full potential.

Property Management and Marketing

Owners who don't reside full-time on the island often rely on property managers. Services include guest reception, cleaning, maintenance, and even dynamic pricing strategies.

Taxation and Costs

Rental income is taxable both in Spain and possibly in your home country (double taxation agreements apply). Other costs: license fees, tourist tax, management fees, maintenance and community charges.

Conclusion: Smart Investment in 2025

With the right strategy, a holiday property in Mallorca can be a rewarding investment – financially and emotionally. Whether you prefer coastal apartments or rustic fincas, a local real estate expert helps navigate legal, financial and practical aspects efficiently.