Foreign Property Purchases Decline in the Canary Islands Amid Rising Prices

In the first half of 2025, property purchases by foreign buyers in the Canary Islands fell by 7.7%, while prices surged by 14.1%, according to data from Spain’s General Council of Notaries. This decline in foreign investment comes at a time when the overall Spanish property market is experiencing growth, highlighting a unique challenge for the Canary Islands as they navigate rising costs and shifting buyer demographics.

Sales Decline in a Competitive Market

The Canary Islands were one of only four regions in Spain to experience a decline in foreign property sales, alongside the Balearic Islands, Navarre, and Valencia. In contrast, foreign home purchases across Spain increased by 2% year-on-year, totaling 71,155 transactions. This discrepancy raises questions about the factors influencing buyer behavior in the Canary Islands compared to other regions.

Despite the decline in the Canary Islands, foreign buyers still accounted for a significant portion of the market, although their share dipped slightly to 19.3% from 20.3% in the same period of 2024. This slight decrease indicates a potential shift in foreign investment preferences, as buyers may be exploring other regions or facing challenges in the local market.

Price Trends and Buyer Demographics

Property prices in the Canary Islands remain among the highest in Spain, with the average cost for properties purchased by foreigners exceeding the national average of €2,417 per square meter. The region recorded the third-largest price increase in Spain, following Madrid (17.1%) and La Rioja (16.3%). This significant rise in prices could be attributed to various factors, including limited housing supply and increasing demand from both domestic and international buyers.

Non-resident foreigners paid an average of €3,126 per square meter, significantly higher than the €1,912 per square meter paid by foreign residents and €1,809 by Spanish nationals. This disparity highlights the premium that non-residents are willing to pay for property in this picturesque region, which is known for its stunning landscapes and favorable climate.

British buyers continue to dominate the market with 5,731 transactions, followed closely by Moroccan (5,654) and German (4,756) buyers. Purchases from Dutch, Belgian, and French nationals also remain robust, while Russian purchases have decreased by 17.4%. This decline in Russian investment may reflect broader geopolitical tensions and economic factors affecting their ability to purchase property abroad.

Interestingly, buyers from the United States, the Netherlands, and Portugal have increased their activity, with Portuguese purchases rising by nearly 23%. This surge in interest from Portuguese buyers may indicate a growing trend of cross-border investment within Europe, as buyers seek opportunities in attractive markets like the Canary Islands.

In terms of pricing, American buyers lead the market, paying an average of €3,465 per square meter, followed by Swiss, Swedish, and German nationals. In contrast, buyers from Morocco, Romania, and Ecuador paid less than €1,400 per square meter. This variation in pricing underscores the diverse economic backgrounds of foreign buyers and their differing motivations for investing in the Canary Islands.

Key Points

• Foreign property purchases in the Canary Islands fell by 7.7% in the first half of 2025.
• Prices in the region rose by 14.1%, with an average cost of €3,126 per square meter for non-resident foreigners.
• Overall foreign home purchases in Spain increased by 2%, totaling 71,155 transactions.
• British buyers led the market with 5,731 transactions, followed by Moroccan and German buyers.
• The share of foreign buyers in the Spanish market decreased from 20.3% to 19.3% year-on-year.
• American buyers paid the highest average price at €3,465 per square meter.
• Purchases by Russian buyers decreased by 17.4%, while Portuguese purchases increased by nearly 23%.