The Real State Of The Property Market In Tenerife
The real estate market in Tenerife has been struggling for some time now, but the picture may be more complicated than you realize. While many are waiting around for conditions to improve, it may actually be a great time to invest in this market.
In recent years, the market has been flooded with repossessions from banks and distressed sales. This can make the market look intimidating from the outside. It's a great opportunity for investors though because it means there are lots of cheap property bargains available for purchase if you know where to look.
People looking to buy property in Tenerife are in luck. Spanish banks have been lending less money in recent years, but you should be able to get a loan as long as you don't have major debts and credit problems or seem like a risky choice. It's a great time to swoop in and buy a property in Tenerife for much cheaper than it would have gone for ten years ago.
Renters will have a slightly harder time. There's a glut of rental units on the market at the moment, which can make finding renters for your property difficult. Things will be easier if your mortgage is already paid off and if the building you're renting doesn't have high monthly fees.
If you can be flexible on what you're charging for rent, there are always people looking for a place to stay in Tenerife. Things aren't perfect for renters here, but they're not the disaster you might think either.
It should come as no surprise that those looking to sell property in Tenerife are going to encounter the most problems. As with Europe and, indeed, much of the world, the real estate market has struggled in recent years. However, Tenerife properties have one important boon going for them: They're on a relatively tiny island where there's only so much room for expansion and new buildings to go up.
Unlike mainland Spain, Tenerife has not seen a surge of new properties popping up, which has helped insulate its real estate market slightly. That said, Tenerife is also full of properties that were bought years ago from easy-to-obtain loans and are now being flipped as quickly as possible. In other cases, banks have repossessed buildings that could not be paid off. These banks and distressed sellers are often willing to close for much less money than should be expected, which can hurt more serious sellers and lower the overall value of property in an area.
Distressed sales are a market problem all around Europe in general and Spain specifically, and Tenerife is no exception. It's worth speaking with an experienced real estate agent or someone who's an expert in property sales in Tenerife to get a feel for what other locations similar to yours are selling for. If you price your house high above the market norm, it's going to sit and not sell forever.
Many long-time property owners in Tenerife have set their desired sales prices at absurd levels that simply aren't realistic in the current real estate market. In some cases these buildings have been sitting empty, waiting for a buyer willing to offer that price for many years. You don't want to lowball the cost of your own property, but you also don't want to price out any buyers that might be interested. It's worth it to take the time to find that happy medium where you'll be making enough money off the sale to be happy but potential buyers will still be interested. You don't want the property to sit on the market forever.
Cancasa, an agent based in Tenerife, feels there are lots of opportunities available but you need to look outside the main resorts to get good value for money.
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