Canary Islands property market: flat prices hit record high

Property prices in the Canary Islands have reached a new high. In the second quarter, prices on the open market rose to 2,279.40 euros per square metre. This represented an increase of 14.2 per cent compared with the previous year. The Canary Islands Statistical Office ISTAC has never recorded higher purchase prices in the entire history of its structured data collection.

ISTAC’s data collection dates back to the first quarter of 1995. The archive therefore comprises 126 data points. Just a year ago, the price per square metre stood at 1,996.80 euros. Within twelve months, the market had therefore clearly and sustainably exceeded the 2,000-euro mark.

In the first quarter of this year, the purchase price stood at 2,233.70 euros per square metre. This represented a year-on-year increase of 2.05 per cent. Statisticians recorded the 21st consecutive rise. It is particularly interesting to look at the baseline figures:

Canary Islands: Property in a price spiral

When the series began in 1995, the price stood at 572.40 euros per square metre. The current level, 31 years later, therefore represents an increase of just under 300 per cent. The market’s movement in only one direction for years was already evident when property prices in the Canary Islands generally broke through a historic milestone.

New-build construction is no longer keeping pace with this trend: in February, the authorities in the Canary Islands granted 287 planning permissions for flats – 42.1 per cent fewer than in the same month last year. What is not approved and built today will be missing from the market in the coming years. This is because demand is still considered to be as high as ever.

The Canary Islands want to build more social housing

The Canary Islands Housing Institute plans to publish calls for tenders for new publicly subsidised flats in the Official Gazette of the Canary Islands shortly. These will specify the municipality, the number and specifications of the flats, the quotas and the deadline for applications. Only those who are of legal age and registered on the public register of people seeking accommodation may apply.

Further rules stipulate, amongst other things, that applicants must have lived in the Canary Islands for at least twelve years without interruption. Furthermore, no member of the household may own a flat. The Canary Islands‘ policy aims to address the ongoing rise in house prices. New rules for holiday accommodation have also already been adopted.