Spain | Real estate outlook in the Canary Islands. March 2021

Summary

Housing sales fell more in the Canary Islands than the Spanish average and have not recovered to their pre-pandemic level. The main reason is the reduction in foreign purchases, whose weight fell below 30% in the first 9 months of 2020. Meanwhile, prices fell by 0.9% in 2020, less than the average (-1.1%).

Key points

• Key points:
• As seen in the national average, the deterioration in mortgages has been less intense than in sales: investment demand may be suffering more.
• Residential approvals broke the growth trend in mid-2019 and the level of new housing starts is below the pre-pandemic trend. By province, the correction has been much greater in Las Palmas.
• The stock of unsold new homes has declined but remains above average.
• New house prices are showing a more favourable year-on-year trend. Moreover, most of the correction in house prices in the coming months is expected to come from second-hand housing.

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