It's a Buyer's Market

Buyers are now in a position of being able to choose from more properties than ever before...

Figures released by Tenerife Property Shop this week show an increase in the disparity between the number of new prospective buyers registered and the number of properties for sale on the market.  Combined with the fact that Spanish mortgages are so much cheaper than the European average, buyers of property in Tenerife have never had it so good.

Further figures released by Tenerife Property Shop's 'Sale Price Index' shows that the average asking prices of properties in the South of Tenerife are levelling off, with vendors readjusting prices to accommodate the new economic climate.  Director, Mary Spencer, explains, 'Buyers are now in a position of being able to choose from more properties than ever before and in many circumstances they are in a powerful position to negotiate prices.  More realistic vendors are taking this into account and are pricing their properties very competitively.  Naturally, these are the properties that are currently attracting buyers.'

The picture painted by Tenerife Property Shop's report is further reinforced by the Spanish newspaper, El Pais, which says that properties are taking longer to sell than in 2004, and that 20% of vendors are dropping asking prices (typically between 6,000 and 12,000 Euros - the equivalent of 1 to 2 million Pesetas). Commenting on the slowdown in the market, Jaime Cabero, head of Madrid's association of real estate agents, explains that "the rhythm of sales in recent years has not been normal". Despite the fall in the number and speed of transactions property prices are still expected to increase by 10% this year.

The situation also favours buyers in other ways.  According to Amado Franco, president of the Spanish saving's bank Ibercaja, mortgages in Spain are 26% cheaper than the European average, whilst interest-bearing bank accounts in Spain pay out 24% more than the European average. In Franco's opinion these figures demonstrate the competitiveness of the Spanish banking system.

Tenerife Property Shop do not expect this window of opportunity for buyers to last long.  Mary Spencer told us, 'This is not at all abnormal for the market, we have seen this before in the nineteen years that we have been selling property in Tenerife.  Conditions like these are generally short-lived, but present a fantastic opportunity for those in a position to buy right now.'