The lack of housing is one of the serious problems that the Canary Islands continue to face in this century, despite the fact that, according to data from the Treasury, there are close to 15,000 empty ones. Basically, this problem is located in the two capital islands and the tourist areas of Lanzarote and Fuerteventura. The population increase in these islands, which in Tenerife is 10,000 more inhabitants each year, has resulted in a huge shortage of properties for sale and especially for rent, which entails, despite the decree of the State Government to prevent an increase of more than 2%, greater demand than supply. And to all this we must add that 50% of the purchase of homes, for example in the south of Tenerife, is in the hands of foreigners, as recognized by Isidro Martín, delegate of the Professional Association of Real Estate Experts, who use them as residence for one or two months a year and then put them up for rent, yes, but vacation rental and not residential.
This situation determines that many workers in the tourism sector end up renting, when they can, apartments in the southern midlands – and shared, many of them – or even reject the job offer for not having accommodation. This is one of the main reasons, according to Carlos Magdalena, president of the SMEs in the South of Tenerife, to explain why it is difficult “until finding waiters to work”.
Podemos Canarias has already warned that a housing law must be promoted, to protect it from foreign investors, while Nueva Canarias advocates limiting the removal of foreigners to the Islands with a “residence law”, although this runs into our membership status from the European Union, where 95% of those who invest in the purchase of homes in the Canary Islands and Tenerife come from.
The purchase and sale of homes by foreigners in the Canary Islands amounted to 9,067 operations last year, 75.3% more than in the same period of the previous year, according to data on real estate transactions from the Ministry of Transport, Mobility and Urban Agenda.
Only in the third quarter of 2022 (from July to September), these transactions grew to 2,808 operations, compared to the 1,888 registered in the same period of 2021. This represents almost double, specifically 48.7%, of purchases made by foreigners in the Islands.
Taking into account only foreigners residing in Spain, the operations carried out between July and September in the Canary Islands stood at 1,132, 43.2% more than the 790 recorded by the Ministry in that period of 2021. Non-resident foreigners in the country they made 1,676 sales, compared to 1,098 in the third quarter of 2021, which represents an increase of 52.6%.
In addition, this same source calculated that the average sale prices in the archipelago were 2,306 euros per square meter in general, which represents an increase of 7.4%, with 1,922 euros/m2 for new housing (+8.7% ) and 2,394 euros/m2 for used (+7.6%).
one in three
One in three homes sold in the Canary Islands was bought by foreigners, a figure that in the first two tourist municipalities in the south of Tenerife (Arona and Adeje) stands at 50%, as long as we do not take into account the subdivisions such as Adeje town. , Buzanada, Valle San Lorenzo or Cabo Blanco, says Walter Marcon, from the real estate agency Canaria Real Estate, in Los Cristianos.
Marcon acknowledges that currently “there has been a slowdown in the sale of villas and houses in the range of half a million euros, when 100 were sold before, now 70 are sold. However, in the sale of apartments with a value between 100,000 and 300,000 euros, the purchase is being very good”. According to him, in Los Cristianos, Playa de Las Américas and Costa Adeje “90% of the buyers are foreigners and it is normal for them to use the house two or three months a year and put the rest up for vacation rental; very few rent it for seasons, ”he said.
As he indicated, the war in Ukraine and the increase in gas have withdrawn the Russians, who were the main buyers of luxury villas and apartments, but “now they are being replaced by Belgians, Germans, Italians and some Scandinavians”, but they are is noticing the war and the gas crisis, he commented. “In recent months – he continued – there has also been interest in acquiring apartments from Lithuanians, Estonians and the Dutch, who have been informing themselves for some time”.
He recognized that finding an apartment to rent for months or years “is crazy” and warned that at this rate the price will continue to increase. According to Walter Marcon, “the average rental price is 15 euros per square meter, so an apartment with one bedroom and 56 square meters does not fall below 850 euros, while in the south-eastern midlands it drops to 11- 12 euros per square meter, between 650 and 700 euros per month”, figures corroborated by Isidro Martín, delegate of the Professional Association of Real Estate Experts and member of Fepeco: “But this not only happens in the tourist area of the South, but it also happens in the big cities, such as Santa Cruz or La Laguna, where ‘urban tourism’ is now taking place, which has caused the rental price to skyrocket and there is hardly any offer”.
For Isidro Martín, the underlying problem is not in vacation rentals or that the sale of real estate is carried out by foreigners, but rather in the fact that “we have spent fifteen years of paralysis of officially protected houses, after the 2008 crisis. It is normal that then paralyzed private construction, but should not have done so in public. If 40 homes had been built each year, today we would have 600 more social homes, with what that means”, he asserted.
NC and we can
Luis Campos, spokesman for Nueva Canarias in the regional Parliament, warned a few days ago that “we have a very serious residential problem that could worsen”, due to its two immediate consequences: the increase in population and the pressure exerted on the market, which “makes it difficult” for residents to access housing, whether owned or rented. Campos recalled that with a similar situation in the Balearic Islands, Mallorca has asked the European Commission to promote measures to limit the purchase of homes by non-residents based on the decisions applied in European Union countries, such as Denmark, the Aland Islands of Finland and Malta. In the same sense, on the 1st of this year, the prohibition, which will last two years, of acquiring homes in the country from non-resident foreigners, came into effect in Canada, a measure that has the objective of controlling prices.
Regional deputies of Sí Podemos recall that according to the Treasury there are some 150,000 homes on the islands that are not listed and that are expected to be in the underground economy. For the deputy Francisco Déniz, a social agreement is needed to review in depth the economic model of the islands based on tourism, and which seems “untouchable”, because it has generated a population increase in the last 25 years that they believe is unsustainable and which causes that the Archipelago does not come out of its levels of poverty and unemployment.
And also, it is leading to residential exclusion, to people who cannot buy or rent a home for which they are partly responsible, added Déniz, for the “deregulated” tourism model.
The Canary Islands is an “absolutely crowded” area for this type of tourism that has led to rents in towns such as Puerto de la Cruz rising from around 500-600 euros, already expensive, to almost 1,200 euros per month. which has meant “the expulsion of our people”.
“Canarian society is gentrifying due to excessive touristification, they are expelling us, everything is becoming more expensive and making us poorer,” says the regional deputy, for whom the Canary Islands are “a stressed area” because the tourist accommodation ceiling “is already surpassed”.
For this reason, he has proposed measures such as endorsing the limitation of home purchases by foreigners with the status of outermost region, on which he recalled that of the 13,291 formalized purchase and sale operations, more than half, 6,456, were carried out by foreigners, mainly Europeans.
Sí Podemos also demands that the tourist moratorium be decisively faced, “because we cannot allow even one more bed” given the “chilling” data that there are possibilities of increasing the places to exceed 700,000, with some 22.3 million tourists per year.
“Limiting the price does not fix the problem, it increases it”
“Limiting the rental price does not fix the problem, it increases it,” says Isidro Martín, a real estate expert at Fepeco. For him, “this government policy scares the owner away from renting his home for long periods of time and ends up going to the vacation rental, where he can get double or triple the profit, and more if he has to deal with a mortgage.” Also the increase in interest and with it mortgage loans “will make it so that few can buy, because the banks are going to toughen the profiles to grant these mortgages and these people are forced to rent, so it will continue to rise, because there are hardly any homes in the market and the public housing policy does not accelerate”.
