If January is anything to go by, I expect 2022 to be another busy year in the Las Palmas Property market. But is this a sign of a healthy market driven by high demand from buyers, or are other factors at play?
For example, are buyers acting now to lock in low mortgage interest rates before the predicted rises later on this year? And has the damage done to the Gran Canaria tourism industry by Covid and travel restrictions really had no impact on the property market? Are prices sustainable after nine years of increases from their 2016 low point? Lots of questions and, as ever, no clear answers. What’s an estate agent to do?
All I know is that quality property is in short supply in Las Palmas, but well-priced apartments and penthouses in desirable locations do come onto the market regularly. We can’t predict the short-term future but we can expect Las Palmas to continue being somewhere lots of people want to live.
A look back at the 2021 Las Palmas property market
Prices rose steadily in 2021 on the back on continued demand for Las Palmas property and especially in the flat areas of the city close to the sea. This demand is built in to the market for a couple of long-term reasons…
- There will never be as many properties in the flat parts of Las Palmas as there are people who want to live there. It is the economic and administrative heart of the island economy and happens to be right next to the world’s best urban beach.
- This area of Las Palmas is pretty much fully developed and any new property has to replace an old one. Most of the empty plots and low-rise housing have already been redeveloped. So, even if Las Palmas raises the maximum building height the supply of new property won’t keep up with demand.
While the Las Palmas property market is affected by wider economic factors, the value of property in city is always underpinned by this systemic demand.
Las Palmas property prices in 2021
According to property valuation firm Tinsa, with valuations based on mortgage applications, prices rose in every quarter of 2021 with a total rise of 4% compared to 2020. The price per square metre remains 26% below the peak prices of 2008.
Idealista values property in Las Palmas at 2039 euros per square metre, compared to Tinsa’s figure of 1526. Idealista’s estimate is based on the price of listings on its property portal. Tinsa’s are based on the actual sale price and are closer to the reality.
Given that prices in the Las Palmas property market vary enormously due to location, these average prices only tell us so much.
At the luxury end of the market, remote workers and digital entrepreneurs continue to buy property in the city. Beachfront and penthouse apartments remain in high demand.
The overall market trend towards property with outside space and a feeling of openness continues.
In the rental market prices are rising even though many holiday lets went back into the residential market during 2020 and 2021. Everyone wants to live close to the beach and the buzz of central Las Palmas. Note that communities of owners are voting to ban holiday lets in many buildings. Always check the copy of the communidad statutes that is registered with the property registry if you plan to holiday let.
The impact of Brexit?
British,and other non-EU) buyers, need military permission to buy in rural areas and even in some urban areas. This rule is causing a lot of confusion because each property registry in Las Palmas interprets it separately. Make sure you check as soon as you decide to buy. The permission is a formality but can take four months to arrive.
Non-EU property owners can only spend 90 days out of a rolling 180 in the EU and cannot offset expenses against holiday let profits. You pay a flat tax of 24% on their holiday let income. All non-resident property owners, EU or non-EU, who don’t rent out their property at all pay a small sunshine tax.
Las Palmas property prices in 2022
Prices in Las Palmas continue to rise as of February 2022 but do face significant headwinds…
- The era of minimal mortgage interest rates is drawing to a close even though local banks still offer fixed-rate mortgages with excellent rates. See my Las Palmas mortgage guide.
- If, as seems likely at some point, the “bubble of everything” starts to deflate it will impact property prices everywhere.
- New builds are coming onto the market and will impact the value of older property and property in marginal areas of the city.
That said, there is no sign of a decline in prices or activity in the Las Palmas property market. If anything there is a shortage of quality property on the market. If you have a property to sell, it is a good time to get a valuation.
As always, property is a long-term investment. This is particularly true in Spain and Gran Canaria where buying costs make short term profit difficult unless you are a specialist developer. The dream of buying a property, doing it up and selling it on for a tidy profit is elusive. It’s why most locals see Las Palmas property as a long-term investment.
Buying a property in Gran Canaria in 2022
My advice to buyers in 2022 is to take your time, get to know the market and avoid getting caught up in any hasty offers. Good property sells fast but hasty decisions can be costly. There is good value out there if you know where to look and what to look out for.
Make sure you work with a good local estate agent who knows the market and the pitfalls. Due diligence on the status of outside areas, the electrical supply, state of the community of owners, town planning rules, etc, takes time but is essential.
Selling a property in Gran Canaria in 2022
2022 is a good year to sell a Las Palmas property. Prices have risen for nine years in a row and there are uncertainties looming. The market is short on quality property and there are plenty of buyers willing to pay the market price.
To sell in 2022 give yourself the best possible opportunity of getting a good price and work with a quality estate agent who…
- Works in exclusivity and is therefore willing to spend money and time marketing your property (photos, virtual tour, quality portals)
- Is associated with one of the large shared MLS or other Spanish property databases that advertises your property to all quality Gran Canaria agents
- Lists your property on national and international portals to give it the maximum possible exposure
- Really knows the local Las Palmas market and has a proven track record of selling property similar to yours
- Knows how to negotiate and achieve the best possible price for your property.
New build property in Las Palmas in 2022
New builds continue to go up with fresh projects appearing regularly. Developers are building a whole new neighbourhood of apartment blocks between Guanarteme and the El Negrín hospital. Investors and constructors swarm over La Isleta looking for plots to develop.
For buyers these new-build properties can be enticing investments with payment plans spread over several years. The key is to make sure that the promoter or building respects Spanish law (very strict about new builds) in terms of payments, delivery days, investor protection, etc. Read my new build buyer guide for more info.
Some of the new-builds in Las Palmas reflect growing demand for outside space, openness and larger windows. Others are sticking to the tried and tested “boxes with corridor model”. This allows them to jam in as many flats as possible but at the expense of livability. My advice to buyers is to consider the resale potential of new-build apartments in the long term…
Ask yourself, “will this property and location still be attractive in ten years once the newness starts to fade?”
I’m Laura and I’m Las Palmas resident estate agent. I’m one of the best-selling estate agents in Spain and help dozens of buyers and sellers every year. Contact me any time about property in Las Palmas and Gran Canaria.
IMPORTANT: This article is an opinion piece based on my experience in the Las Palmas property market. It should not be used as a definitive guide to price trends. If you’re considering buying a Las Palmas property, please contact me for a detailed chat about the best options for you.