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For the best analysis of the property market in The Canary Islands 2021
The Canary Islands Property Market 2021
Click here for lots more information about the Spanish Property Market in general. Many of the issues covered also apply to the Canaries. The report below looks at the statistics relating to the most important of the Canary Islands for the overseas property market. As the figures show, the islands of Gran Canaria and Tenerife dominate the foreign market.
Introduction to the Canary IslandsProperty Market
However, in comparison with some other regions it is a relatively small part of the overall overseas market. In 2020, the Canary Islands made up 6.8% of the overseas sector. In contrast, the big 3, that is, Andalucía, Cataluña and the Comunidad Valencia (Costa Blanca), accounted for 61% of the overseas sector.
Nevertheless, before the virus struck the overseas property market in the Canaries was continuing its post-2008 recovery. From a low in 2010/11, overseas property buyers returned in increasing numbers year-on-year, peaking in 2018. However, in common with several of the regions that attract foreign buyers, the Canaries did lose some ground in 2019 and there were 18% fewer foreign buyers. Given that over 30% of all foreign buyers in the Canary Islands are British it’s possible that the weak GBP was a factor.
Then COVID-19 arrived and Spain’s first lockdown started on March 14th 2020. This meant that the property market nationwide only operated normally in the first 10 weeks of the year. Many transactions already in the pipeline and ready to complete faced delays because Notaries were only allowed to undertake emergency work during the lockdown. Some purchases collapsed completely. Mortgage applications also got bogged down and purchases that had been agreed before lockdown didn’t complete in some cases until much later in the year.
Where the Numbers Come From
Even the statistics from the Notaries, always my preferred source, were of limited value because they are published half-yearly. However, after Spain’s first lockdown started on March 14th 2020, Notaries were only allowed to oversee emergency work for several weeks. Unfortunately for sellers and buyers alike, property completions did not qualify as ‘emergency work’. By the time they reopened for all business, travel restrictions were in place to and from many countries. To find out what happed for the rest of the year wouldn’t become clear until full-year figures became available in May 2021.
As usual, the stats from the Property Registries are best ignored as they count when a property is inscribed in the registry, not when it completed in front of the notary. Even in normal times inscriptions may be weeks or even months after completions. As a result, the Notaries and Property Registry statistics always differ and not by a little. They are usually out of sync by 20% – 25%. In contrast, the Notaries’ returns count when a transaction actually happens, the date on which a purchase completes.
In spite of that, compared with the statistics we quote in other reports, the data regarding the overseas property market in the Canaries is, in my view, partial at best. This is due to the fact that the Notaries don’t separate out the individual islands. They just count the Canary Islands as one unit and give one number in respect of overseas buyers in the period. Secondly, the breakdown from the Ministry of Development only covers two islands, Gran Canaria and Tenerife. In spite of these two issues I think there are some things the figures can tell us
Where the Activity Is
First of all, by digging into the 2020 statistics, it is clear that Gran Canaria and Tenerife dominate the overseas property market in the Canary Islands. Comparing the Notaries’ final total for the Canaries as a whole in 2020 with the Ministry of Development’s count over the same period for just Gran Canaria and Tenerife we see that 95% of overseas buyers chose those islands. In terms of split, it’s quite even; 49.1% bought in Tenerife and 50.9% in Gran Canaria. So, although not a complete picture it’s good enough to get a feel for where the market is as we start to see travel restrictions loosen.
The Importance of the Overseas Market
Over the full-year 2020, overseas buyers had a 16.5% market share of Spain’s overall property market. However, in several of the locations most popular with foreign buyers the market share was much higher. The Canaries were one of those regions. Although foreign buyer numbers in 2020 were down compared with 2019, in line with every other region, they maintained their market share of 30%. This is the second highest in Spain, only in the Balearics is the overseas market share higher at 35.6%.
Foreign Spending Power
Not only do foreign buyers in the Canary Islands take a market share way above the national average, they also spend more. According to the Notaries’ figures overseas buyers spent on average €1,777 per square metre in 2020. That compares with the domestic average of €1,439. However, in the Canary Islands the average spend was €1,877, well above the domestic average and higher than both Andalucía and the Comunidad Valencia on the mainland.
Our view is that demand from overseas buyers was holding up very well throughout 2020 and the early part of 2021. While, no doubt, some potential buyers have put their plans to purchase a property in Spain on hold others are telling us that they intend bringing their planned purchase forward. They just want to get on with it. However, until travel restrictions are relaxed it is impossible to assess how much of that demand will translate into actual transactions.
For more about each island in turn please visit this Locations page, for information about the uniqueness and variety that property buyers can find in the Canary Islands.
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