Practical case Mallorca: Finca with guesthouse in Deià – Two generations realise their dream together
The parents had considerable assets from the sale of a family business. The children earned stable income as self-employed IT consultants and could participate financially in the purchase.
At a glance
- Purchase price: 4.250.000 €
- Financing required: 2.550.000 €
- Equity: 2.572.500 €
Anonymised case figure · not a binding statement for other projects · §34i GewO
A family project in one of the most exclusive regions of Mallorca
An entrepreneurial family from Switzerland had spent time on Mallorca regularly for many years. While the parents were shortly before retirement, the two adult children worked location-independently and already spent several months a year on the island. The wish arose to acquire a property that offers enough room for all generations without having to give up privacy.
After a longer search, the choice fell on a natural-stone finca with a separate guesthouse in Deià – embedded in the Serra de Tramuntana and with a wide view over the Mediterranean.
Initial situation
The parents had considerable assets from the sale of a family business. The children earned stable income as self-employed IT consultants and could participate financially in the purchase.
Instead of acquiring two separate properties, the family deliberately chose a joint solution with a long-term perspective.
Financing overview
- Purchase price: 4.250.000 €
- Additional costs: 552.500 €
- Renovation and energy optimisation: 320.000 €
- Total investment: 5.122.500 €
- Equity: 2.572.500 €
- Financing required: 2.550.000 €
The financing share corresponded to around 60 % of the purchase price.
The challenge
Although sufficient assets were available, the financing had to take into account the different income and asset circumstances within the family.
In addition, there was agreement that the historic finca was to be modernised technically without changing its original character. Provided for were a complete renewal of the building services, the installation of a photovoltaic system with battery storage, efficient air conditioning and the careful refurbishment of the guesthouse.
All measures were to be fully planned in financially already before the purchase.
Analysis
First the financial possibilities of all those involved were considered together. This showed that a balanced combination of equity and financing spared both the parents' asset structure and the children's liquidity.
In parallel, all modernisation costs were calculated by specialist companies and included in the total investment.
This created realistic and robust financing planning already before the purchase.
Financing solution
The financing was set at around 60 % of the purchase price.
The additional costs and a considerable share of equity were contributed immediately. At the same time, all planned modernisation measures were fully integrated into the overall planning, so the work could begin after the transfer of ownership without additional financing steps.
Thanks to this structure, sufficient liquidity remained for future investments and unforeseen expenses.
Outcome
Once the modernisation was complete, a home was created that met the needs of all generations. While the parents spend their retirement mainly on Mallorca, the children use the guesthouse regularly as a work and living place.
The joint investment proved economically more sensible than acquiring several individual properties.
What other buyers can learn
Properties are increasingly acquired across generations today. For high-quality properties in particular, joint financing can be sensible if it is planned early and structured transparently. It is equally important to take modernisation costs fully into account already before the purchase.
Frequently asked questions
Can several family members acquire a property together?
Why were the modernisation costs taken into account immediately?
Is financing sensible despite high equity?
Conclusion
Acquiring a finca in Deià shows that high-quality property financing does not depend on the purchase price alone. When several generations invest together, assets are used strategically and all modernisation measures are taken into account from the start, a durable solution emerges for one of the most exclusive residential locations on Mallorca.
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To the case report →A similar situation in Spanien? Let's talk.
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Book a free consultationAnonymised individual case, not a binding statement for other projects · Siegfried Perini, BAFA-notified for the cross-border activity of the owner Olga Nikushkina · §34i GewO · no tax or legal advice · no financing commitment; conditions depend on creditworthiness, loan-to-value and bank