Tenerife property market

2024 Full Year

The Tenerife housing market in 2024 displayed steady performance despite signs of shifting dynamics, with overall activity remaining resilient in the face of global economic uncertainties. While total transaction volumes held firm, foreign demand—particularly from non-residents and expats—saw a noticeable decline. Resale properties outperformed new builds in both pricing and demand, and key coastal areas continued to attract strong interest. Property prices rose overall, even as new-build values softened slightly. Despite elevated borrowing costs, the mortgage market remained active, and housing starts demonstrated long-term confidence from developers. This report outlines the key data and trends shaping Tenerife’s property market in 2024.

Sales performance

Tenerife recorded a total of 12,467 housing sales in 2024, virtually unchanged from the previous year, representing a year-on-year decrease of just 0.3% (Fig. 1-1). Compared to the ten-year average, transactions were 8% higher, and over the last decade, total sales volume has grown by 37%.

Foreign buyers were responsible for 4,770 of these transactions, a 9% drop from 2023. However, this segment remains slightly above its ten-year average and has grown by 17% over the decade (Fig. 1-2). These foreign transactions split into 2,038 purchases by resident foreigners (expats) and 2,732 by non-resident foreign nationals (FNRs). Expat purchases declined more sharply, by 15% year-on-year, while non-resident purchases fell by 5%. Over the long term, FNR activity has increased more rapidly, rising by 26% over ten years compared to 7% for expats.

As a result, the foreign share of the local property market declined to 38.9%, down from 42.5% in the same period last year (Fig. 1-3). While still a significant portion of total demand, this marks a shift in the influence of overseas buyers on the market.

New build sales were also subdued, with 639 new homes changing hands in 2024—a 13% decline on the previous year (Fig. 1-4). This was 23% below the ten-year average, and 8% lower than a decade ago, underlining constrained supply and possibly waning buyer appetite for newly constructed properties.

Within Tenerife’s municipalities, there were 11,206 transactions, reflecting a 2.5% drop from 2023 (Fig. 1-5). Compared to the ten-year average, however, this was an improvement of 8%, and total municipal sales have increased by 32% over ten years.

House price trends

Official data from the Spanish Housing Ministry placed the average sale price of homes in Tenerife at €198,008 in 2024, up 10% from the previous year (Fig. 2-1). In contrast, the average price for newly-built properties was €235,928, down by 4% year-on-year.

These opposing trends are further highlighted by the ten-year price indices (Fig. 2-2). The index for all properties rose from 100 to 170.2 over the decade, a 70% increase, while the index specifically for new properties rose to 141.4—an increase of only 41%. This suggests resale properties have appreciated significantly more than new builds. A likely explanation is limited resale supply and rising demand in central or highly desirable areas, while new build stock is more affected by construction costs, delayed completions, and changing buyer preferences. Over five years, all property prices increased by 70%, compared to just 28% for new properties.

Adeje case study

In the municipality of Adeje, one of the most desirable areas in Tenerife, the average asking price on property portal Idealista was €3,984/m² in 2024, representing a 7% annual increase (Fig. 2-3). Over five years, asking prices in Adeje have increased by 56%. A ten-year index of asking prices for this area rose from 100 to 221.9 (Fig. 2-5), implying asking prices more than doubled, growing by 122% over the decade—outpacing general transactional price growth, and highlighting the role of seller expectations, tourism-driven interest, and limited coastal supply.

Mortgage market

A total of 4,897 new mortgages were registered in Tenerife province in 2024 (Fig. 3-1), down 16% from the previous year. This figure is also 16% lower than the ten-year average, although volumes have still increased by 13% over the entire decade.

The average Euribor rate—used as a benchmark for most Spanish mortgage contracts—was 3.27% in 2024 (Fig. 3-2), falling from 3.86% in 2023, a 15% year-on-year decrease. This decline followed several years of aggressive interest rate hikes by the European Central Bank (ECB), aimed at curbing inflation.

Historically, the Euribor ranged from a low of -0.49% in 2021 to a high of 3.86% in 2023. The 2024 rate sits below this peak, suggesting the ECB may be nearing the end of its monetary tightening cycle. Market speculation in late 2024 pointed toward potential rate cuts in 2025, though persistent inflation and global uncertainty have led to cautious optimism rather than a sharp reversal in policy.

Housing starts

There were 1,579 new housing starts in Tenerife based on planning approvals during 2024 (Fig. 4-1). This number was in line with the previous year—just under 1% lower—and represents a 35% increase compared to the ten-year average. Over the last ten years, housing starts have risen by 225%, highlighting renewed construction activity from a previously low base.

This growth aligns with stronger long-term demand and investor confidence post-pandemic. However, the dip from last year may reflect rising construction costs, tighter lending, or permitting delays within certain municipalities.

Summary

• Total sales were steady year-on-year, but up 37% over ten years.
• Foreign demand dropped 9% and now represents 39% of total buyers.
• New build sales declined 13% and remain below average long-term volumes.
• Average house prices rose 10%, while new home prices fell 4%.
• Asking prices in Adeje increased 7% year-on-year and have more than doubled over ten years.
• New mortgage signings fell 16% amid high interest rates and tighter credit conditions.
• Euribor declined slightly from its peak, suggesting the start of a downward trend.
• Housing starts remain strong, with activity well above the long-term average.

Conclusion

Tenerife’s housing market in 2024 showed mixed signals. While overall transaction volumes and prices generally held up, there was a significant cooling in foreign demand, new build sales, and mortgage activity. Sellers continue to show price ambition, particularly in premium locations like Adeje, though actual price growth is easing outside of the resale sector.

Looking ahead, any further decline in interest rates could offer some relief to buyers and boost mortgage activity, especially among foreign investors and primary homeowners. Supply dynamics, tourism trends, and the global financial backdrop will all play crucial roles in shaping the market direction through 2025.

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Disclaimer

These reports are prepared in good faith using publicly available data. While efforts are made to ensure accuracy, no guarantees are provided regarding the completeness, reliability, or suitability of the information for any purpose. Use of this information is at your own risk.