Unrelenting Housing Crisis Grips the Canary Islands
The earthquake that the housing sector has become in recent years has not subsided in 2025. Price escalation continues, supply keeps shrinking, and the difficulties of accessing a home persist for a large part of the Canary Islands’ population. However, the market in the Islands is beginning to show signs of exhaustion, after several years of experiencing a veritable property boom.
Soaring Prices Defy Affordability
The first snapshot from the Archipelago is, once again, an extraordinary rise in prices, both for homes for sale and those for rent. Up to September—the latest period for which records exist from the General Council of Notaries—the price per square metre reached €1,921, marking a 22% increase compared to the previous year’s figures. The numbers recorded by other online portals specialising in property sales are even higher, although notaries have warned this year that the initial asking prices for homes are often significantly reduced before the sale is finalised.
This dizzying ascent seems endless, but it is already starting to be felt in the number of transactions. According to expert analysis, the property market in the Canaries is facing a slowdown that began to be felt in the second half of 2025. The reasons are clear: to the existing lack of supply, which was already hampering sales because there simply weren’t enough houses for so many buyers, we must now add the excessive amounts being asked for properties. These figures are completely beyond the purchasing power, not of a few, but of the vast majority of Canary Island residents.
Islanders Face the Worst Affordability in Spain
In fact, it is worth remembering that islanders are the Spaniards who face the greatest difficulties when buying a home. And not only because they encounter some of the highest prices in the country here. Additionally, they must face purchasing a house that costs almost as much as in territories where residents have considerably more purchasing power, but with the second-lowest wages in all of Spain. In other words, Canary Islanders buy homes at almost the same price as in the Basque Country, but with a third less salary.
So much so that Canary Islanders need almost two years of their full salary to provide the deposit for a home. And if they wanted to pay in cash, island buyers would have had to save their entire salaries for nine years. A complete utopia, as doing so would mean not spending a single cent on food, petrol, clothes, or rent during that entire period. All this is because houses have appreciated in such a way that they now cost 60% more than twenty years ago.
Market Slowdown Takes Hold as Rentals Become a Battleground
A circumstance that the property market is already beginning to notice, as it starts to show signs of fatigue. Since last April, the number of property transactions in the Archipelago has been decreasing month by month, whereas until that point the increase in sales had been almost constant since 2022. September closed with 5.6% fewer operations, but the declines even reached 9% last June.
What continues to offer no respite are rents. The Canary Islands have seen four consecutive years of continuous increases, and in 2025 alone the rise has exceeded 8%. High prices and scarce supply have turned the search for a rental house into a veritable free-for-all. Up to 128 people compete to become the tenant of each property that comes onto the market. This has hardened the selection process and, at times, begins to resemble a casting call with tough conditions.
Alternative Housing Forms Boom as Outlook Remains Bleak
The housing crisis has, in turn, spread other residential formulas that until recently were purely anecdotal. Seasonal rentals or room rentals are experiencing a real boom in the Archipelago and across the country. This type of offering has increased by up to 20% this year, and renting a 10-square-metre room can cost an average of €400. A type of rental that the central government wants to curb, as it considers these contracts are used to circumvent the restrictions imposed by the Housing Law.
In fact, 40,000 households in the Canary Islands, protected from rising prices by this legislation which was amended in 2019, now face, at the end of their contracts, an upward review of their rent, which can reach €2,267 per year. And faced with this situation, the prospects for a drastic change in the coming year are almost non-existent.
On one hand, public administrations, despite the launch of ambitious plans by both the central and regional governments to put more housing on the market, have completed and delivered a very limited number of public properties—too few to turn the situation around. On the other hand, private developers also cannot step on the accelerator to bring new developments to market. The lack of finalised land and bureaucracy delay many projects. A situation that means although more housing construction permits have been submitted this year, the increase is very limited—only 40 more in the first ten months of the year.
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