To reach more beneficiaries, the maximum price of the homes that can be eligible increases from 270,000 to 382,000 euros.
The government especially benefits young people up to 40 years of age, large families and single-parent families to cover 100% of the mortgage.
The Consell de Govern has approved various modifications to improve and extend the public support programme for accessing a mortgage, aimed mainly at young people, to facilitate the purchase of a primary residence for residents of the Balearic Islands, and which will allow them to buy homes of up to 382,000 euros, by increasing the initial threshold, which stands at just over 270,000 euros.
Changes have also been introduced to especially benefit and provide the best conditions for young people, up to 40 years of age, a group that has mostly accessed this IBAVI aid system to facilitate the purchase of housing, so that, in this case, they will receive guarantees of up to 20% of the value of the home from the administration and thus be able to cover 100% of the mortgage.
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The support programme for accessing a mortgage to buy homes of up to 382,000 euros is extended
This relaxation and graduation of the percentage of the guarantee on the home mortgage loan to grant up to 20 % also includes other groups, along with people under 40 years of age, such as large families of any degree, single-parent families and people with disabilities or those who have disabled dependents.
For all other eligible applicants, the guarantee will be 15 %. The granting of the IBAVI guarantee is conditional on the granting of the mortgage loan by the financial institution, which will have to finance over 80 % and up to a maximum of 100 % of the purchase value of the home depending on the regulations and scheme applicable to each institution.
About the threshold, the new maximum purchase price of the home, without the expenses and taxes inherent to the purchase, which can benefit from the conditions of the IBAVI Mortgage Guarantee programme, increases from the 270,150 euros initially established to 382,700 euros.
The aim is to adapt the programme to the increase in housing sales prices in recent years and to be able to reach a wider group of beneficiaries, taking into account the context of prices and supply and the results of the two years of the initial programme, with which the IBAVI has approved 478 guarantees, with an unequal distribution by islands (402 in Mallorca, 57 in Menorca, 19 in Eivissa and none in Formentera).
Before the end of 2024, in mid-December, the government approved the agreement to give continuity to the programme, since the deadline for submitting applications was 31 December, and extended the deadlines for applications and for formalising the loans until February 2028. The current overall amount of this programme is 30 million euros. Once the amendments have been approved, the agreements with the financial institutions will be signed shortly.
The programme aims to promote access to homeownership by employing a line of guarantees. To be able to access this system, a series of requirements are maintained for applicants. The requirements include the need to prove continuous or discontinuous residence in the Balearic Islands for a minimum of five years; that the home must be used as the applicant’s habitual and permanent residence, and that the applicant does not own any other home, with certain exceptions as in the past.
Likewise, to be eligible for the programme, the combined income of the applicants may not exceed the limit of 6.5 times the public multiple effects income indicator (IPREM) weighted with the regional coefficient: 60,666.65 euros for one borrower and 68,250 euros for two or more borrowers, under the IPREM of 2023 and taking into account that the amount is updated annually.
Among the conditions of the programme, it is also established that the financing operations will have to be organised through a mortgage loan contract financed with funds from the financial entity and that the financial entity may not require the contracting of any additional banking product or service for the granting of the mortgage loan.