The Canary Islands, they say, are the Hawaii of Europe with beaches, palm trees, a balmy climate all-year-round with no hurricanes, and a laid-back island lifestyle.
They are not far wrong!
Throw in a bit of the Galapagos islands (have you seen the size of the lizards), some Spanish outdoor living, European-standard healthcare, security and property law, and you can see why the Canary Islands consistently rank amongst the best places in the world to live.
The Canary Islands are, however, still far cheaper than Hawaii and other property hotspots, both in terms of property prices and living expenses.
Why Gran Canaria and not another Canary Island?
Of the seven main Canary Islands, Gran Canaria is likely the best one from a lifestyle point of view. It has the big city, the beaches, the most varied landscapes, and just the best all-round offer.
Tenerife isn’t far behind and each of the islands has its own charm, but Gran Canaria comes out on top for me. Otherwise I wouldn’t have lived here for the last 20 years.
Why Las Palmas in Gran Canaria?
I live and work in Las Palmas city, the largest city in the Canary Islands and the capital of Gran Canaria. I’ve been a professional realtor here for 10 years.
My name is Laura Leyshon by the way, and if you’ve got this far through the article, we should probably have a chat.
With over 400,000 people, Las Palmas is one of Spain’s ten biggest cities. It has one of the world’s best city beaches, a great restaurant and café scene, and all the mod-cons that you’d expect. Las Palmas is also a growing hub for remote workers and international location-independent professionals.
This has taken the city a little bit by surprise!
10 years ago, if you heard a foreign voice on the Las Canteras beachfront, you probably knew the person. Today the city has residents from all over the world, often speaking English as their common language while they learn Spanish. Las Palmas is still a Canarian and Spanish place and remains, just about, under the radar but it is getting more cosmopolitan every year.
By the way, the real estate market here is run using a US-style MLS system with well-regulated buying and selling agents.
Gran Canaria Real Estate for US buyers
The title of this article is a cheeky SEO grab because there is nothing unique about buying real estate in Spain and the Canary Islands as a US citizen. American resident and non-resident buyers, and sellers, are subject to the same rules as all other non-EU foreigners. There are no restrictions on foreign ownership of property in Spain and the Canary Islands.
US buyers have never been a significant market segment here in Gran Canaria but I have noticed a rise in the number of enquiries from American buyers interested in Las Palmas real estate. I’ve helped several American citizens to buy homes here in Las Palmas city over the past few years. If you’d like a personal recommendation from them, please let me know.
The rise seems to be due to a number of different factors. The US domestic political scene, the rise of location-independent working, the Spanish Golden Visa system, and increasing awareness of how attractive Las Palmas is as a place to live and work.
So, with potential US buyers in mind, here is a selection of useful information that goes a bit deeper than the standard “get a NIE number and a bank account” Chat GPT rehash.
Getting residency via a Golden Visa
The Golden Visa is a good pathway to residency and even Spanish citizenship for Americans. You have to invest half a million euros, plus buying costs of 10%, in property. This can be in several smaller properties or in one big one. There are also other pathways to Spanish residency and citizenship for entrepreneurs and investors.
I would advise you to use a local gestoria or lawyer to apply rather than an online service. In fact, most things in Spain and Gran Canaria work best if you can speak directly to the person in charge of making them happen.
Here is my more detailed article about the Spanish Golden Visa.
The process of buying a Las Palmas property
The first part of the process is to choose an estate agent and work with them throughout your property search.
You can, of course, go it alone and contact selling agents directly. However, most of the few people I meet that have experienced serious problems buying a Las Palmas property did it without an estate agent.
There are lots of little pitfalls involved in buying a Las Palmas property, and there is always a missing bit of paper. A good estate agent knows from experience what to look out for, and how to solve the issues that almost always come up.
A lawyer, also a good idea, does the heavy lifting of checking the legality, but your estate agent sees all the details and often fixes problems before they get out of control.
Using an estate agent to buy a Las Palmas property is free as realtor commissions are paid by the seller. A good estate agent will save you time and likely a good chunk of money.
The cost of buying Las Palmas real estate
Buying a Las Palmas property costs around 10% of the price you pay in additional costs, fees and taxes (not estate agent fees as these are paid by the seller). A lot of these fees are paid during the lead-up to the actual purchase.
This leads to a moment when a foreign property buyer is asked to hand over a large sum of money to their gestoria or lawyer. This sum covers notarial costs, IPT tax (6.5% for second-hand property in the Canary Islands), registry costs, and other assorted minor costs.
It may seem odd to hand over this money without knowing exactly where it is going but it is accepted practice in Gran Canaria and there is nothing untoward going on. You do eventually get a full breakdown of the costs, plus any leftover funds get returned to your account.
Finding the right Las Palmas property
If, like most foreign buyers, you want a good-sized property with outside space and/or a beach view then you will need some patience.
Quality property in Las Palmas, especially on the beachfront or in buildings with great views, is in short-supply. The good ones don’t get sold all that often and there is always a backlog of people waiting to buy.
With high-demand property, it is vital to have as much of the paperwork you need arranged in advance. If you are already on the island, have a year’s residency under your belt, a deposit in a Spanish bank account ready to go, and a mortgage pre-approval organised with a bank, you are at a huge advantage. Non-resident cash buyers are not at too much of a disadvantage either.
To view a property, let your estate agent make initial contact and arrange the viewing. Otherwise the MLS system locks your buying agent out of the commission structure and they won’t be able to help you.
The best place to scan the market is currently the Spanish property portal Idealista.com. Most agencies list for-sale property here as well as in one or more of the competing MLS portals.
In fact, Idealista is so ubiquitous that if you find a property for sale that isn’t listed on it, I’d see it as a potential red flag.
If you find anything you want to see, tell your estate agent: This, from a buying agent POV is very important: If you have already contacted a seller or their agent about a property, your buying agent is frozen out.
Making an offer, signing an Arras contract
Once you find a property that you would like to buy, standard practice is to make an offer and leave a token deposit of 500 euros. This señal isn’t essential but is appreciated as a sign of a serious offer. You get it back if your offer is rejected, and it is discounted from the total you pay if you buy.
If your offer is accepted, you then prepare to enter a legally-binding contract known as a Contrato de Arras. Upon signing you pay a 10% deposit which is held in Escrow by a notary, lawyer of estate agency brokerage.
The Arras is a preliminary agreement between a buyer and a seller that outlines the terms of a future sale. As a buyer, with the agreement of the seller, you can include break clauses connected to structural surveys, and even mortgage approval.
Most Arras contracts run for two or three months to allow for all paperwork to be collected together. This may sound long but it is better to allow plenty of time for missing documents to surface, and for the bank to finalise your mortgage approval, if needed.
More on the process of buying a Las Palmas property.
The FEIN, and signing day
10 days before the actual signing day when you acquire the property, you have to go to the notary and confirm that you understand the process. This is part of what is called the FEIN, a new European Union consumer protection measure. It is a formality but you have to do it. If it isn’t arranged correctly, the whole buying process is set back another 10 working days.
On signing day, barring a last minute paperwork tangle, the process is quite simple. The Notary confirms that you understand and agree with the contract, everyone signs, and that’s that.
In the old days, the process included a pause while the Notary popped out to use the restroom and the buyers handed over a chunk of black money. This is now, thanks to new taxation rules, mercifully rare. If you are invited to pay some money in this way, note that you could well end up with a tax bill for it. The Spanish taxman chases up anyone buying a property for under its estimated market worth.
Renovations and budgets
A construction or renovation budget in Spain is often a piece of paper that is believable rather than accurate. Regard initial estimates as the absolute best case scenario if nothing goes wrong at all. Then expect things to go wrong. Also note that anything that comes up outside of the initial budget will be charged as an extra. It is wise to factor in a good 15-20% of the initial budget for cost overruns.
This is not meant as a criticism of the way things are done in Gran Canaria, just as an honest explanation of how things work here.
You are, after all, on an island with long supply chains and delays are inevitable.
By the way, if your renovation project does come in on time and on budget, please introduce me to your team.
Ongoing costs of owning a Las Palmas property
The yearly costs of owning property in Las Palmas are low.
You pay an annual IBI tax which rarely amounts to more than a few hundred euros for urban property. There are no municipal charges for rubbish collection.
Non-resident buyers who do not rent out their property also pay a small sunshine tax every year but again this is not more than a few hundred euros.
Non-resident owners who rent out their property on a Holiday Let basis also miss out on tax deductions as they are not allowed to offset costs against the tax they pay on rental earnings. Your gestoria and/ or accountant will inform you about the current tax rule. The Spanish taxman prevents sophisticated tax-avoidance systems simply by changing the rules every year.
Buying a Las Palmas property
I hope this guide, which is by no means thorough, acts as a realistic guide to the process of buying real estate in Gran Canaria and its capital city. If you like what you have read, and think I sound like the kind of estate agent you’d like to work with, please contact me by telephone, or just drop me a line with this form and I’ll be in touch…
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