The Consell de Govern has approved expanding the assistance program to access a mortgage for buying a home, aimed at individuals up to 40 years old, to properties costing up to 382,700 euros. This was announced during a press conference following the Consell meeting on Friday by the Minister of Housing, Territory, and Mobility, José Luis Mateo. He emphasized that the threshold, previously set at 270,150 euros, has been significantly increased considering the high housing prices and supply issues.
Since the program’s inception in 2023, the Balearic Institute of Housing (Ibavi) has granted 478 guarantees. Mateo expressed the goal of increasing the number of beneficiaries and making it easier for more people to benefit from the assistance program to purchase a property. However, he noted that the distribution of these aids has been uneven across the four islands, with 402 beneficiaries in Mallorca (84%), 57 in Menorca (12%), 19 in Ibiza (less than 4%), and none in Formentera.
In an effort to reach more individuals and all the islands, the Consell de Govern has approved other modifications to the program to benefit those up to 40 years old, who have predominantly utilized the Ibavi assistance system to facilitate home purchases. As part of these changes, this group will receive guarantees up to 20% of the property value from the government, enabling them to cover 100% of the mortgage. This provision is also available to large families, single-parent families, individuals with disabilities, or those caring for someone with a disability. For other qualifying applicants under the program’s unchanged criteria, the guarantee will be 15%.
Mateo reiterated that the Ibavi guarantee is contingent on the approval of the mortgage loan by the financial institution, which must finance above 80% and up to 100% of the property acquisition value based on applicable regulations. Following the approval of these adjustments, the Conselleria plans to sign agreements with various financial entities participating in the program, with room for others interested in joining.
In December of last year, the Govern approved an extension of the program until February 2028, as the deadline for applications was initially set for December 31st. The current budget for this program is 30 million euros.
Requirements to Access the Assistance
To qualify for the government assistance, applicants must demonstrate a continuous or intermittent residence in the Balearic Islands for a minimum of five years. The property being purchased must serve as the primary and permanent residence for the applicants, who should not own any other property, with certain exceptions. Additionally, the combined income of applicants cannot exceed 6.5 times the public income indicator multiplied by the regional coefficient, which stood at 60,666 euros for a single borrower and 68,250 euros for two or more borrowers in 2023, subject to annual updates. Lastly, the program mandates that financing operations must be arranged through a mortgage loan contract funded by the financial institution, without the requirement of additional banking products or services for loan approval.