Laura Leyshon: Gran Canaria Estate Agent: 608169845
Professional and personal services for foreign buyers and sellers in Gran Canaria
When I wrote the 2019 guide to Las Palmas property in late 2018 I noted that I expected average prices to rise in 2019 despite a set of moderating factors.
These were; a decline in tourist rental investment, an increase in new-build property, and the inevitable decline in tourist numbers following the recent boom.
We must now add the uncertainty of national elections on April 28 and local elections on May 25.
Let’s have a look at each of these factors in more detail… [Read more…]
The latest Spanish Ministry of Development figures show that the Canary Islands real estate sector turns over just 44% of what it did in 2006 just before the global subprime crash.
The industry turned over 2600 million euros in 2016 compared to 6.100 million euros in 2006; a drop of 56%.
While this sounds like a serious problem it really isn’t.
The Canary Islands real estate market (along with the rest of the Spanish sector) was in a huge bubble back in 2006 and dropped sharply once the crisis took hold.
For example, in 2011, the sector turned over just 1.717 million euros. In contrast, last year’s figure was the highest since 2008.
After a decade of correction, prices are now back at reasonable levels and the market is looking healthy.
The figures point to a gradual and (most importantly) controlled increase in real estate activity; a healthy rather than a heady rise.
See the figures here in La Provincia newspaper here (PDF).
In support of this assessment, the general secretary of the Santa Cruz de Tenerife’s Federación Provincial de Entidades de la Construcción (Fepeco; the Tenerife construction industry body), Isidro Martín, has recently stated that he expects 2017 to be a transition year before a healthy recovery in 2018. He expects the real estate market in the Canary islands to rise by 20-30% over the medium term (referring to turnover rather than property prices).
To back up his assessment, we have figures from BBVA Research, (the research department of BBVA bank) which found that the number of real estate transactions in 2016 rose by 12.1% across the Canary Islands (the average across Spain was 13.9%).
BBVA Research also reported that the affordability-to-risk ratio for Spanish families is currently 30% above the long-term average meaning that they are currently well-placed to buy property. This is mainly due to lower prices and low interest rates.
BBVA Research did warn that the number of sales to foreign nationals is significant in the Canary Islands and that Brexit could weigh on the market in areas of high foreign demand (especially due to the fall in the value of the pound against the euro).
How does this all affect the Las Palmas property market?
Las Palmas is a busy city and there is plenty of pent-up demand from locals who are looking to upsize after years of recession and strict mortgage conditions from local banks. Tourism in Gran Canaria is at record levels and local employment is growing.
All in all, it looks like a positive year for property in Gran Canaria and Las Palmas; residential rental rates in Las Palmas are increasing, the banks are being more reasonable, and the tourist rental market is also pushing up demand for investment properties in high-demand areas of the city such as Las Canteras beach and the Puerto District.
I’d expect the number of transactions to rise this year and prices to remain level or increase slightly all over Las Palmas in 2017/2018 (barring any outside economic shock). The high-demand areas in the Puerto and around the beach, where prices are already rising, will lead the way.
As evidence for rising prices in Las Palmas, the Spanish property portal Idealista produces a detailed breakdown of the prices of second-hand property across Spain. The latest report, including figures for Q1, 2017, shows that while property prices in the Province of Las Palmas (including Gran Canaria, Lanzarote & Fuerteventura) are flat, they rose in Las Palmas city by 0.5% in the past 12 months and were up 2.1% year-on-year in Q1 2017 (see page 15 and image below).
Idealista also tracks monthly price fluctuations in Las Palmas.
As for Brexit, while non-residents are a significant minority of buyers in Las Palmas, the high demand from locals and other nationalities is likely to mitigate any drop in demand caused by Brexit worries and the weaker pound.
Getting a Las Palmas Mortgage in 2017
How to buy a Las Palmas property in 2017
Guide to the taxes and fees involved in buying a Las Palmas Property
I’m Laura Leyshon and I’m Las Palmas’ resident British estate agent. I specialise in helping foreign buyers and sellers in the city and I’m always available if you have any questions about property in Las Palmas and the surrounding areas.
Lots of my clients want to buy a house or villa in Las Palmas de Gran Canaria city.
The problem is that Las Palmas is a dense, high-rise city with few typical suburban areas. Houses, especially villa-style houses with gardens, are in short supply.
However, they do exist and the process of buying one is the same as for any other property. The challenge is finding a good one.
Here’s my guide to where to find a house or villa in Las Palmas city…
The Guanarteme district of Las Palmas is about to get 300 new apartments if a new build project comes to fruition.
A 20-strong investment consortium that includes Satocan (owners of the Gran Canaria Sheraton) and the Dinosol supermarket group plans to resurrect a 300-property building project from the pre-crisis days.
The group now owns the 8000m² build site (the guide price was €30m) that was originally acquired and cleared by the now-defunct Spanish company Martinsa-Fadesa. It planned to put up a huge 13-storey building called the Gran Guanarteme but went bankrupt before building started.
The plot in question is at the western end of Mesa y Lopez street and is bordered by Mario César, Fernando Guanarteme and the Plaza de América.
The site already has permission for up to four buildings that can be 10, nine and seven storeys high although there are no public plans for what the new investors plan to build.
We do know that the consortium plans to start work before the end of 2017.
Are you planning to buy a Las Palmas property in 2017? Please read these tips fresh from the market first.
I’m Laura and I’m Las Palmas’ resident property expert.
This is my up-to-date advice about how to go about it. It includes the latest info on local mortgages, exchange rates, the Las Palmas property market and how to choose the best local help possible.
I couldn’t tell you the exact date when the Las Palmas property market changed. It was around Christmas 2016.
And so far the changes are only in the high-demand areas close to Las Canteras beach.
The market just flipped from a buyer’s market (as it had been since about 2008) to a seller’s market.
Why?
Because demand is rising, there’s a lack of quality property on sale, the holiday and residential rental markets are booming, and the local banks are finally offering decent mortgage deals.
The change makes a big difference to foreign buyers coming to Las Palmas to buy a property.
What this means to buyers is that you need to have you finances in place early in the process.
The local and Spanish banks in Las Palmas are relaxing their mortgage terms and there are good deals out there due to low interest rates.
The thing about Spanish banks is that they are all run in a top-down way. The decision about your mortgage is never made here in Gran Canaria. Instead, all the paperwork goes to headquarters.
Nothing that your the bank in Las Palmas says matters until Madrid agrees.
Several buyers I know fell foul of this in 2017. They got assurances from their local branch here in Las Palmas and put down a deposit only to find out that the bank had changed its terms.
This is why I urge all Las Palmas property buyers to apply for several different mortgages. Most applications need similar paperwork and banks often accept it electronically.
The extra effort is more than worthwhile if ‘computer says no’ at the last minute at your preferred bank.
I advise going to an online bank such as ING Direct (be prepared for a long paper trail), a big Spanish bank such as Santander, and at least one or two others that offer decent mortgage terms (such as Sabadell, BankInter, Bankia, etc).
While the online banks often offer good terms, they are also stricter about their loans. Online banks in Spain can be absolute pains when it comes to demanding extra paperwork.
Another option is to use a local mortgage broker to apply to many banks for you. They charge a fee but do make sure that nothing is missing from your application.
Also, given that interest rates are low and that US interest rates are set to rise, a fixed-interest mortgage deal is well worth considering.
The market is moving fast in the areas where most foreign buyers want to own a property in Las Palmas. So, it is vital to get your paperwork into the banks before you try and buy a property.
Knowing how much you can borrow is important but in a fast market it’s the time saved that is most valuable.
If you have the funds ready to buy you are in a strong position. You can move fast and are at an advantage over people who depend on the banks.
Be aware that all transfers these days have to be electronic due to money laundering laws. You must have a Spanish bank account open before you need to transfer any money from home to Spain.
The tourist rental market in Las Palmas is booming to the extent that it’s looking like we are in a bubble…
Everyone with a rental property is on the portals and the pile of Tourist Rental Licence applications gets bigger every day.
For the right property, a well-laid-out, well-decorated apartment close to the beach, preferably with outside space, tourist rental is an excellent long-term idea.
Of course, the right property in other areas also rents out well. Period apartments in and around the Old Town, apartments with views close to shopping areas, etc.
But, there’s a good chance that supply will soon exceed demand in Las Palmas. This will push down occupancy levels and the amount owners can charge.
Before you invest in a tourist rental property, make sure that you buy one that is future-proof. And get good advice about the right areas and property types.
At the moment, residential lets are also booming with rents rising and demand high. The downside of renting your property out long-term is that you can’t use it when you want to.
For more on renting, see my detailed Las Palmas property rental guide.
With the market starting to move, there are new estate agencies opening in Las Palmas every week. Some are new franchises from Mainland Spain, and independent agents setting up offices. Others are one-man-bands with a mobile phone and little else.
For buyers, this influx of new agents adds a layer of uncertainty…
Big agencies like RE/MAX Cony Overseas care about their reputations and the properties they show. But, not all agents and agencies are as thorough.
As a buyer you want to be sure that your agent is looking after your interests. You want to work with someone who values your satisfaction and their reputation more than they value their next cheque.
Since sellers pay agency fees, my advice to all buyers is to choose an established agency and one that is part of the shared property database.
It gives you legal guarantees and peace of mind.
There is no need to take risks when buying a Las Palmas property.
As Las Palmas’ resident estate agent, I specialise in helping foreign buyers to buy a Las Palmas property that suits them.
I’m with you during the entire process from the first enquiry right through until you have the keys and settle in.
As a professional estate agent, I make sure that you find a property that suits you and understand each stage of the sale process.
Buying property in Las Palmas is safe and while there is a fair bit of paperwork, it can all be done with no risk and (relatively) little hassle.
A major benefit of working with me to buy a property is that I am a RE/MAX agent and can show you almost any for-sale property in the city.
And, because many of my clients come to me thanks to recommendations it is very important for me to make sure that I provide the best possible service to everyone.
If you have any questions about the Las Palmas Property market, please feel free to contact me for a chat.
With demand, residential rents and rental yield all rising, I predict a busy year for the Las Palmas property market in 2017. [Read more…]
