Within a month, our winter visitors arrive and my life gets hectic. So, while I still have the time, let’s look ahead at what to expect if you plan to buy a Las Palmas property in 2018.
Las Palmas Property price evolution 2017-18
Average house prices in Spain are increasing on average. However, the rise is patchy with most of the gains concentrated in the big cities, on the popular stretches of the Mediterranean coast, and on the islands.
Property prices in Gran Canaria follow a similar pattern. A small rise across the board with bigger increases in desirable areas.
Average property prices in Las Palmas started to rise consistently in 2017 but most of the gains were close to the beach and in other desirable areas of the Puerto District. Demand was fuelled by a good mix of foreign buyers, holiday let investors and local buyers taking advantage of lower mortgage rates and more relaxed bank conditions.
The average Las Palmas price rise year-on-year is at 4.1% although I’d estimate that prices in the Puerto District are growing at 10%+.
With tourism booming and the Gran Canaria’s economy doing well, there’s no reason to think that 2018 will be different.
It’s worth noting that prices are not rising at frothy rates and are still way below the 2007 peak: See this chart by valuation company Tinsa.
Las Palmas mortgages and interest rates
The consensus seems to be that European interest rates will start to rise towards the end of 2018. It could be a good time to take out a fixed interest rate mortgage as the rates on offer are as low as they will ever be.
The Spanish banks are slowly relaxing their lending requirements and locals are upsizing and investing to take advantage of record-low interest rates. Residents with enough income can now borrow 90% of the value of a property, while non-residents still need a 30% deposit.
If you’ve just arrived in Gran Canaria, be aware that the banks don’t lend to people unless they have lived and worked on the island for at least a year, or if they are eligible for a non-resident mortgage.
Las Palmas rental prices booming
Rentals are booming in Las Palmas in with prices going up by 25% in some areas in the last two years. This is partly due to owners switching from residential to holiday letting, but is also because there hasn’t been any new construction in the city for almost 15 years.
While holiday letting gets all the attention because of the juicy yields, rising rents and property values make residential renting an attractive long-term investment in Las Palmas.
Rental prices won’t go down until builders start back up in earnest, or until weaker holiday rental properties stop making a decent return and come back into the residential market.
Las Palmas holiday let property in 2018
Renting out a Las Palmas property to tourists is legal and that isn’t going to change in 2018. However, the existing law is being rewritten as parts of it have been declared unconstitutional by the Canarian Supreme Court.
If you have a holiday rental property, get your paperwork in as soon as possible just in case the new rules are stricter.
Rental returns on quality holiday rentals (close to the beach, well decorated and with outside space), are excellent. However, the supply is increasing and there will come a point when it starts to exceed supply. It’s worth investing now to make sure that your rental property stands out.
If you’re planning to buy a holiday let property, or turn your existing Las Palmas apartment into a Vivienda Vacacional, please feel free to contact me for a consult.
New builds in Las Palmas
New build levels are still way below what’s needed but I’d expect more building projects to appear in 2018. Buying property off plan is a safe process in Spain because the laws are very strict.
The off-plan properties ones that did come up in 2017 sold out fast. I’ll let you know as soon as any new developments come onto the market.
Buying a Las Palmas Property in 2018
The only problem buyers had in 2017 was the speed that good property sold at. Demand was high and supply still fairly tight. Good property in the Puerto area sold fast in 2017 and I’d expect the same to happen in 2018.
However, I think more owners will decide to sell in 2018 as rising prices and the improving economy make people want to upsize or move.
If you are planning to sell a Las Palmas apartment in 2018, I’m more than happy to give you a free valuation.
If you plan to buy a Las Palmas property in 2018, have all your paperwork ready to go, your 10% deposit in a local bank account, and a mortgage pre-approved with at least two banks.
With so many buyers around, sellers don’t want to have to wait weeks for a bank to make a decision and you could easily lose out if you aren’t ready. Note that you can’t put down a 500 euro deposit to reserve a property for a few days anymore.
I’m Laura and I’m Las Palmas resident estate agent. I help dozens of foreign buyers to find and buy their Las Palmas property every year. If you are interested in buying a Las Palmas property in 2018, please feel free to contact me.