The surge in holiday rentals in southern Tenerife is significantly impacting the local housing market, creating a critical need for better coordination between local authorities to balance tourism demands with the housing needs of residents. Over recent decades, the south of Tenerife has transformed due to a booming tourism sector, which has increased the demand for accommodation and driven a rapid expansion of holiday rentals.
This trend has not only affected the economy but has also resulted in substantial social and urban changes, as more property owners shift to holiday rentals, which are often more profitable than long-term residential leases. Consequently, the availability of affordable housing for local residents has sharply declined.
Rosa Dávila, President of the Cabildo of Tenerife, recently voiced concerns over the growth of holiday homes, noting the difficulty Tenerife faces in managing the sheer volume. In the past months alone, 5,000 new applications for holiday homes were submitted, adding to the existing 22,000. This influx has severely distorted the residential rental market, especially in highly tourist-dependent areas like Adeje and Arona, limiting housing options for locals.
Tourism’s Role in the Housing Crisis
According to the Federation of Hotel and Tourism Businesses, the Canary Islands welcomed 1.3 million more tourists from 2017 to 2024, a 14% increase. However, traditional tourist accommodations, such as hotels and apartments, saw minimal growth (0.3%). Most new visitors are choosing holiday rentals, exacerbating the housing shortage in regions like southern Tenerife.
In response, Dávila has suggested a moratorium on new holiday home registrations to control what many see as a primary cause of the housing crisis. She argues that the surge in registrations, partly due to changes in the regional government’s Holiday Home Law, has overwhelmed local councils’ ability to regulate these properties effectively.
Diverse Opinions on the Crisis
Not everyone agrees with Dávila’s assessment. The Canarian Holiday Rental Association (ASCAV), led by Doris Borrego, attributes the crisis more to a lack of affordable housing development and legal uncertainties in the traditional rental market. The ASCAV claims that 40% of rental homes have vanished due to legal insecurities, with only 20% shifting to holiday rentals. The association also points to inadequate urban planning as a contributing factor, particularly in tourist areas where rapid population growth has not been matched by housing supply for local workers.
Data from the National Statistics Institute (INE) support this view, showing that the Canary Islands have over 211,000 empty homes, with public housing comprising just 1% of the total housing stock, far below the national and European averages.
Calls for Policy Adjustments and Regulation
Javier Cabrera, president of the Círculo de Empresarios y Profesionales del Sur de Tenerife, echoed these sentiments, noting that conventional rental housing has become less profitable due to restrictions imposed by the State Housing Law, leading many owners to convert properties into holiday rentals. Cabrera also highlights the conflicts between tourists and residents in tourist-heavy areas, emphasizing the need for different regulations for tourist and residential zones.
Despite tourism’s contribution to reducing unemployment in southern Tenerife by almost 6,000 people over the past year, the housing crisis persists. The continued interaction between the expanding tourism sector, rising holiday rentals, and the shortage of affordable housing for residents has compounded the problem, underscoring the urgency for a balanced approach to local housing and tourism policies.
