Housing prices in the Canary Islands drop by 2.4% in the first quarter

The average price of housing in the Canary Islands fell by 2.4% in the first quarter of the year, reaching 2,212 euros per square metre, according to the 'Real Estate Registry Statistics' published by the Association of Registrars this Monday.

The latest figures reveal that while the price of new housing in the Canary Islands increased by 7.7% in the first three months of the year, the price of pre-owned housing saw a decline of 4.9%. Despite this drop, the Canary Islands still maintain one of the highest average house prices in Spain, following closely behind Catalonia, which averages 2,463 euros per square metre.

Sales and Purchases in the Canary Islands

From January to March 2024, the Canary Islands recorded a 21.3% increase in registered sales and purchases, totaling 6,163 transactions. Of these, 1,437 were for new housing, while 4,726 were for pre-owned housing.

Housing prices in the Canary Islands drop by 2.4% in the first quarter

National Context of Housing Prices

Nationally, the average price of housing rose by 0.8% in the first quarter, reaching 1,998 euros per square metre. This increase was primarily driven by a 3% rise in new housing prices, while pre-owned housing prices slightly decreased by 0.2%. This marks the third consecutive quarter of rising prices.

New housing accounts for only about 20% of all transactions and often includes pre-agreed sales dating back two years, making pre-owned housing prices a more accurate reflection of market trends.

Annual and Regional Trends

Over the past 12 months, the average price of housing in Spain saw a year-on-year increase of 1.9%, with new housing prices rising by 4.1% and pre-owned housing by 1.1%.

The highest average prices in the first quarter were observed in:

  • Madrid: 3,344 euros per square metre
  • Balearic Islands: 3,325 euros per square metre
  • Basque Country: 3,031 euros per square metre
  • Catalonia: 2,463 euros per square metre

Conversely, the lowest prices were in:

  • Extremadura: 804 euros per square metre
  • Castilla-La Mancha: 893 euros per square metre

Increase in Registered Sales

Housing prices in the Canary Islands drop by 2.4% in the first quarter

Between January and March, 151,467 property sales were registered in Spain’s land registries, marking a 16.6% increase over the previous quarter. This surge breaks the downward trend observed over the last three quarters.

New housing sales saw a significant rise with 31,226 transactions, a 30.1% increase from the previous quarter. Pre-owned housing transactions also increased, with 120,250 sales marking a 13.6% rise.

Residential Mortgages and Foreign Demand

The number of residential mortgages increased by 21.1% in the first quarter, reaching 108,910, reversing a six-quarter decline trend. This rise in mortgage activity was more pronounced than the increase in house sales, despite the anticipated decrease in interest rates not yet occurring.

Foreign demand for housing accounted for 14.2% of sales, a slight decrease from the previous quarter but still significantly higher than the usual percentages since 2014. The British led foreign purchases with 9.1%, followed by Germans (6.8%), Moroccans (6.1%), French (5.9%), and Belgians (5.5%).

Regional Foreign Demand

Housing prices in the Canary Islands drop by 2.4% in the first quarter

Foreign demand decreased in 14 Autonomous Communities and increased in three. The highest volumes of foreign purchases were in:

  • Balearic Islands: 31.7%
  • Valencia: 28.8%
  • Canary Islands: 26%
  • Murcia: 23.4%
  • Catalonia: 15.6%

These trends highlight the dynamic nature of the housing market in the Canary Islands and across Spain, with significant regional variations and the impact of both domestic and international factors.

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