The Best Tenerife Property Bargains are not the Cheapest
Property prices in Tenerife, in common with the rest of the world, have suffered at the hands of the recent recession, but new evidence shows that demand for Tenerife Property has now turned the corner. Buyers over the coming months will be looking beyond the cheapest properties as credit constraints relax and their buying power grows.
Demand for Tenerife Property is now increasing to levels above last year but there is still a surplus of unsold housing stock on the market. As predicted by the 5 stages to property market recovery, it is the heavily discounted and cheapest properties that have been sold first.
This phase of buying the cheapest property is probably over, but that should not dissuade today’s buyers. The cheapest properties also tend to be the least desirable. Beach front homes, for example, will rarely be offered with massive reductions. They don’t need to be.
This recession has been caused by a restriction of credit and because of that, people have less buying power as they cannot borrow as much. Some of the most discounted properties and best bargains to be found have been out of the reach of many buyers. For example, in an area where you might once have got little change from a million Euros for a luxury villa overlooking Playa de las Americas you can now pick up a villa nearing completion for a snip of the price, at less than €700,000. But that has still been beyond the reach of most people.
However, credit in Spain is easing according to statistics from Spain’s National Institute of Statistics, and this should increase individual’s buying power. Mortgage approvals in June were up 7.2% on the previous month and the value of mortgages rose by 5% compared to last year.
Of course this may not mean that you can now afford a luxury villa, but in a market where prices have been pushed down over the last couple of years, it does mean that you can acquire a better property than ever before.
What this means for the Tenerife Property Market is that buyers will be concentrating their interest on the next rung of the price ladder, in the €180,000 to €280,000 range, where there are some highly desirable (and discounted) properties waiting to be snapped up.
