Law 4/2025, of 18 July, allows the Balearic Islands to develop land for housing through an accelerated process called strategic residential projects. It applies to Palma, municipalities with more than 10,000 inhabitants, and—in reclassifiable transition areas—those with more than 20,000. It requires allocating at least 50% of the land to social housing (100% in new developable land), ceding 15% of the development rights, and sets densities of 150 to 225 inhabitants per hectare. The deadline for submitting projects is 24 July 2027.
If you own land in Mallorca and have been waiting for years for planning to move forward, this law is the reason why many people have started getting phone calls this year.
This is no minor reform to Balearic urban planning: it's an extraordinary measure, with an expiration date, to put land into development without waiting for the revision of the general plan. At Construcciones Armalutx, we've been building on the island since 1967 and have seen quite a few emergency regulations come and go. This one has demanding conditions, but also deadlines that, for once, are measured in months.
What is a strategic residential project in the Balearic Islands?
It is an urban planning figure created by the Law 4/2025, of 18 July, this allows for the expedited processing of land development for housing, bypassing the standard planning modification process. Its stated objective is to increase the supply of land to facilitate access to "decent, adequate, accessible, and affordable" housing.
It came into force on 24 July 2025, after its publication in BOIB No. 97.
In plain English: the Government has opened a temporary window for land that cannot be developed today to be able to be developed, in exchange for a very large part of what is built being protected housing.
Which municipalities in Mallorca can participate and under what conditions?
The law distinguishes three areas, and the conditions vary considerably between them:
- Palma, with its own treatment in Chapter II of the law.
- Municipalities with more than 10,000 inhabitants, on urban and developable land.
- Municipalities with more than 20,000 inhabitants, which can also act on transition areas by reclassifying them as developable.
This third scenario has generated the most discussion because it opens up development to land currently classified as rural in the transition zone. In Mallorca, Palma, Calvià, Manacor, Llucmajor, Marratxí, Inca, and Alcúdia have populations exceeding 20,000 (INE, 2025). To use this option, the municipal council had to approve it before 24 July 2026; by November 2025, none had done so, and Manacor and Inca had rejected it.
How much social housing needs to be built?
Percentages are the hard part of the law and it's important to understand them clearly before doing any calculations:
| Scope | Minimum protected housing | For rent |
|---|---|---|
| Palma and municipalities with more than 10,000 inhabitants. | 50 % | 50% of that percentage |
| New developable land in transition areas | 100 % | 50% minimum |
In other words: assuming that transition areas are reclassified, everything built is protected housing, and half are for rent. It's not a private residential development with a social quota; it's the other way around.
In addition to that mandatory transfer of the 15% of the lucrative use free of urbanisation charges to the city council, which is also intended for public housing (articles 7, 10, 14 and 20 of the law).
What density can be achieved?
The maximum gross residential density depends on the size of the municipality:
- Palma: 225 inhabitants per hectare.
- Municipalities with more than 20,000 inhabitants: 180 inhabitants per hectare.
- Municipalities with between 10,000 and 20,000 inhabitants: 150 inhabitants per hectare.
- Ibiza: 225 inhabitants per hectare.
These figures are high for the Balearic standard, and they are set on purpose: the law seeks compactness and number of homes, not large plots.
How is it processed and how long does it take?
The law establishes a simplified procedure: preliminary study, simplified strategic environmental assessment and positive administrative silence six months after the documentation is complete (Article 16). That last point is what really changes a developer's calculation: six months versus the years that a planning modification can take through the ordinary channel.
It's important not to confuse this with what happens in other areas of Balearic urban planning, where the recent omnibus law has gone in the opposite direction and eliminated tacit approval for legalisations. Here, however, silence works in favour of the applicant.
Until when can projects be submitted?
The submission deadline is 24 months from the date of entry into force of the law (article 16.1.a). As it came into force on 24 July 2025, the deadline is 24 July 2027.
In other words, as of 5 October 2026, there are just under ten months left. Furthermore, the Constitutional Court accepted a constitutional challenge against part of the law in November 2025. And between the preliminary study, drafting, and environmental assessment, that timeframe disappears. Anyone considering taking advantage of this option should already have their technical team working on it, not just thinking about it.
What does this mean if you are a developer or landowner in Mallorca?
This means there is a viable path to development, albeit at a price: the product is largely protected and the transfer fee is high. The operation is viable if the land has been acquired at a fair value and if the execution costs are well controlled, because the sale price is capped by the protected status.
That's where the construction aspect comes in. In subsidised housing, the profit margin isn't based on the sale price—which you don't set—but on the cost per square metre, the construction time, and the absence of additional costs. It's worth reviewing how much construction costs per m² in Mallorca in 2026 and how to avoid cost overruns on a build before closing the books.
As a construction company in Mallorca with over 50 years, we regularly work on multi-family housing developments and know what it means to deliver on time when there's an administrative schedule to contend with. You can see how we approach the construction company for new builds in Mallorca and what does a turnkey project.
Frequently asked questions about Law 4/2025 on strategic residential projects
What is Law 4/2025 of the Balearic Islands and what does it allow to be built?
This is the law on urgent actions for obtaining land through strategic residential projects, approved on 18 July 2025, and in force since 24 July of that year. It allows for the development of land for housing through an accelerated procedure in Palma, in municipalities with more than 10,000 inhabitants, and, on reclassifiable transition areas, in those with more than 20,000, always with a minimum of 50% of the land designated as protected housing.
Until when can strategic residential projects be submitted in the Balearic Islands?
Until 24 July 2027. The law sets a submission period of 24 months from its entry into force, which occurred on 24 July 2025 (Article 16.1.a). After that date, the extraordinary procedure is closed and land development reverts to the ordinary planning modification procedure.
What percentage of protected housing does Law 4/2025 require?
A minimum of 50% of the land must be designated for social housing in Palma and in municipalities with more than 10,000 inhabitants, half of which must be for rental. In new developable land from transitional areas, the requirement rises to 100% of the land designated for social housing, with at least 50% for rental. In addition, 15% of the profit-making development rights must be transferred to the city council.
Is it possible to build on rural land in Mallorca under this law?
Not generally. The law applies to transition areas (the strip between urban and rural land) in municipalities with more than 20,000 inhabitants, reclassifying them as land for development. Ordinary rural land remains subject to the limits of the Balearic Urban Planning Law 12/2017, which restricts new buildings. We explain in detail whether it is possible to build on rural land in Mallorca.
How long does it take for a strategic residential project to be approved?
The simplified procedure stipulates that tacit approval is granted six months after the documentation, including environmental documentation, is complete, following a preliminary study and a simplified strategic environmental assessment. In practice, the preliminary phase of drafting the study and environmental documentation takes several additional months, so it is advisable to plan the entire process for around a year.
When does it NOT make sense to take this route
- When the land was purchased at the price of free residential use. With a protected product, the numbers don't add up.
- When the project you want is a high-end home. This law is not intended for that.
- When you don't make it to 24 July 2027 with the preliminary study submitted. Without margin, the procedure does not get finished.
- When your plot is already consolidated urban and you can build directly. You don't need this figure at all.
Let's talk about numbers before architecture
If you're considering a strategic residential project in Mallorca, the first thing you need to know is the construction cost, because for subsidised housing, the sale price is already fixed. We can help you with a realistic cost analysis and a timeline.
Call us on +34 625 16 47 18 or write to us at info@armalutx.com. We are based in Inca and work throughout Mallorca.
This content is for guidance only and does not replace personalised legal or technical advice. The specific application of Law 4/2025 depends on municipal planning regulations and the classification of each plot of land.
