Property in the Canary Islands
If a committee had been set up to design a holiday home paradise, they would probably have invented the Canaries. An archipelago of islands with varying size and geography: sand dunes for some, tropical forests for another, waterfalls for the next, others with all three. A snowcapped mountain to admire, but warm all year down on the beach – rarely too hot and never too cold. Available all year-round, four hours from the UK and with no jet lag! The “fortunate islands” indeed, as the Romans named them.
The British have been buying property in the Canary Islands for decades, and now they are firmly back in fashion. Political unrest in North Africa in early 2015 sent tour operators scurrying back with planeloads of Northern Europeans looking for safe winter sunshine, just as the pound recovered against the euro. Suddenly a lot of us were looking at Spanish property again for warm winters.
You have a choice of seven islands. Tenerife is the largest, with 900,000 people, then Gran Canaria with 850,000. Lanzarote has 140,000 and then down to Fuerteventura, La Palma, La Gomera and finally El Hierro with 11,000.
Choosing your island is a big part of the fun. Each has characteristics that will appeal to particular personalities, but maybe not the most obvious. Tenerife, for example, has more people, but a small island like La Palma can have a wonderful sense of community. La Gomera is more rural, but Gran Canaria perhaps has more interesting countryside.
All the islands have great opportunities for outdoor activity. Windsurfing is big on Fuerteventura (which means “strong wind”), you can hike through Lanzarote’s lava fields or down Tenerife’s deep gorges. Scuba diving, fishing and anything involving a boat is popular, unsurprisingly, and Tenerife in particular has some world-class golf courses.
The architecture includes cheap and cheerful apartment blocks overlooking the towns and beaches, villas further out of town, but also some lovely South American style villages, and colonial-style houses with wooden balconies and leafy patios.
The islands are a popular location for relocating from overseas. Of the 2.1 million population, one in six was not born here, and many of those are British. While it is warmer and cheaper (and arguably more fun) than a retirement in Britain, many of us have come here to work too, particularly in the tourist trade or serving the expat communities. The Canaries are very welcoming islands.
Where to Buy Property in the Canary Islands
Tenerife is the largest of the Canary Islands and also the most easily accessible with regular flights from most UK airports making Tenerife a plausible option for a second home. If you’re looking for a property with rental potential, Tenerife is the main player. It’s by far the most popular island, generating more enquiries per property, per year that the other islands in the archipelago. But do beware of legislation regarding holiday rentals.
Playa de las Americas is very popular - crammed with bars and restaurants, water sports and a marina for fishing trips and pleasure excursions, the area is a great buzzy place for a holiday. Prices here start at €80,000 for a studio flat with swimming pool, but you can pay €150,000 plus for a high-spec one with a sea view. In more residential (northern) areas you can buy a villa from a €200,000 rising to over €1m for more exclusive properties.
Rentals are strong in these resort areas. One-bedroom apartments on golf resorts typically cost from around €100,000, although you can find them for €80,000, with a rental potential of around £200 a week.
Twenty minutes drive from the airport is San Eugenio Bajo, a family-friendly area on the edge Playa de las Américas – close to the hedonistic nightspots. Beaches within walking distance include Playa la Pinta beach in Puerto Colon and Fañabe beach. And because of these attractions and the good year-round weather property in the area has a long rental season. Expect to pay around €300,000 or an average family home.
To the south, Las Americas merges with Los Cristianos and contains rows of holiday apartment complexes leading from the seafront. It is these complexes behind the beach that reap the richest rental rewards.
Further up the coast, the popular and increasingly high-end area of Costa Adeje stretches from the resort of Playa Fanabe with its golden beaches through the pretty fishing village of Caleta and north to Playa Paraiso. Fañabe is an upmarket area where you’ll pay €200,000–225,000 for a good-quality one-bed apartment, or €2m plus for some of the villas. Properties at the five-star Ritz-Carlton Abama resort at Guia de Isora cost from around €700,000.
Another popular location is going north up to Los Gigantes, a lively resort area at the foot of huge cliffs that is popular with snow-birds and retirees. You can get studios for around €60,000, two-bedders can vary between €150,000 and €250,000, depending on views and spec.
With regular flights to Lanzarote from most UK airports and a mere 37 miles from one end to the other, almost anywhere in Lanzarote becomes an easy trip for the holiday-home owner. Lanzarote is the most volcanic of the Canaries, but don’t let that put you off, it is also (arguably) the classiest and most expensive. It is beautiful to look at, in an unconventional sort of way, carefully and artistically designed and preserved with tight planning rules. Most of the houses are built in a white cubist form, to a maximum of three storeys.
Painter, sculptor, and architect Cèsar Manrique (1919-1992) convinced the Lanzarote authorities to ensure any new developments were built no taller than two storeys high. Although prices have increased as the island continues to shed its undeserved Lanzagrotty tag, you’ll still be able to find apartments under €100,000. Don’t expect any change from a cool €1 m however, if luxury villas are more your thing.
The three main resorts on Lanzarote are all located along the southern coast: Puerto del Carmen, Costa Teguise and Playa Blanca. If you’re looking for a property that you can rent out, then bear in mind that the rentals marketing is firmly focussed on two major resorts, Puerto del Carmen for apartments and Playa Blanca for villas. But, again, seek legal advice with regard to holiday rental licences.
Puerto del Carmen
The well-known Puerto del Carmen is the island’s oldest – and most expensive - resort, with an attractive old town starting with a fishing harbour and lively strip that extends to 6 km of beachfront. For a property investment, it’s probably the best; it’s the biggest and is only 10 minutes from the airport, with the best of the weather and beaches most property is only a short walk from one of the great beaches and entertainment. A good range of options is available here from studios and small apartments priced from €75,000 and new-build villas from around €220,000.
The Matagorda district is very sought after, with a lovely quiet beach and just a five minute cab ride into town with two-bedroom apartment in one of the best complexes starting at around €249,000.
The quieter but more expensive resort of Playa Blanca at the southern tip of the island, is a thirty-minute drive from the airport and home to a raft of four and five star hotels. There are a good choice of restaurants and beaches, with the well-known Papgayo beach a short drive away watersports and diving options on offer in the town. In Playa Blanca you can buy a two bedroom apartment for €85,000, or a villa from around €200,000.
Costa Teguise is the obvious choice for those wanting to make the most of the island’s nightlife, with one-bedroom apartments starting at around €75,000, two-bedders from around €140,000, villas from around €250,000 whether three or five bedrooms.
The least commercialized of the main Canary Islands, Fuerteventura also offers the best beaches, with golden sand blown over from the Sahara, great water sports and a growing rentals market. It boasts about 100 miles of tropically-white sand beaches flanked by turquoise waters. Expect to pay as low as €75,000 for a one-bedroom apartment or bungalow in a residential complex.
The expat communities tend to be concentrated in the holiday resorts of Corralejo and Caleta de Fuste where you’ll find a range of property, extending from studios up to luxurious villas backing on to the island’s two golf courses. Corralejo, in the north is the place to be if making a rental return is your priority, with one-bedroom apartments from €80,000, or two-bed villas can be found for €130,000. In Caleta de Fuste you can get a small bungalow for €100,000, and if it's a golf resort you’re after, there’s Fuerteventura Golf Resort in Caleta de Fuste with properties starting from €190,000.
Gran Canaria is very diverse, with small coves, long sandy beaches, British breakfasts and Spanish beach bars in amongst five-star hotels and lovely old fincas amid lemon tree groves. Although this is not Spain’s version of Florida (that would be Tenerife), expats do retire in Gran Canaria, and the healthcare is good. Expats, in the majority, live in the more arid south of the island. You can now pick up an apartment from as little as €100,000.
Las Palmas is the capital of Gran Canaria and the biggest city in the Canary Islands. It’s a thriving metropolis and an important trading hub for both this island and its neighbours. City apartments start from €75,000 for one bedroom, or €130,000 for two.
The mega-resort of Maspalomas located on the southern tip of the island is famous for its rolling sand dunes and its unrivalled beaches. You can get a bungalow from €90,000 although bigger options/villas are around €300,000.
There’s also Meloneras, which claims a greater concentration of five-star hotels than anywhere else on the island. Head to the mountains above the southern resorts, to Monté Leon for instance, for larger chalets and villas. This is the Beverly Hills of Gran Canaria, with high-end prices reaching the €1m mark, though you’ll still be able to buy a three-bedroom detached villa there with a pool for €450,000.
Those looking to relocate may do better to look west and south, with the rather more residential Puertos Mogán and Rico and the holiday destination of Arguineguín. Although they are resorts in their own right, they have a greater service infrastructure such as schools and feel less transient than Playa del Inglés. They’re also as competively-priced as the better-known Playa del Inglés.
Buyers Need to Know
Purchase process – as per mainland Spain.
- A 5 per cent Impuesto General Indirecto Canario (IGIC) Canary Island tax not VAT is applied to new-build properties, whereas resale properties are taxed at 6.5 per cent (ITP).
Rentals: the authorities in the Canaries have been clamping down on holiday rental rules for several years: seek local legal advice at the time of your search if you hope to rent out your home.