Insular real estate market finished 2021 demonstrating apparent signs of recovery. Prior to November, 8,200 sale and purchase deals were stricken, reaching 9,000 transactions in December, exceeding the results of the previous year by 30%. According to the data of Notary General Counsel, the figure sends us back to the indicators of the year of 2008.
“The market is very dynamic”, Rafael Bello, the broker of Remax Arcoiris, is quoted as saying. As Mr Bello comments, such dynamics is explained by easy access to funding by banks, coupled with low interest rates.
In general, the demand is formed by people looking for their own housing and those who have decided to move to a new dwelling soon after COVID consequences. The pandemic gave birth to new offers and demand, including expats who turned back to the islands in 2021.
Besides, the demand is heated by the investors who tend to buy real estate to secure their capitals. By the data of Idealista company, insular rental processes, in the capital of Gran Canaria in particular, bring income of 6% compared to 0,3% from ten-year government bonds.
However, Mr Bello stresses that investors and their financial activity segregates the small sector of the market. “Some people are found who want to lease out and earn money, but the situation does not resemble 2009 or 2010, when there were many investors who had been buying real estate from banks at a good price. There is an effect of such detained demand shown, by it is not in the priority in the market”, he says.
“In the next few months the market will still be busy. While there is no lack of financing and since the funding is cheap, the market will be progressing. Besides, we expect new jobs to be created due to money influx from the European funds”, Mr Bello was quoted as saying.
There is only one obstacle, namely, slow construction. The offer of newly-built housing is poor. Three years ago the construction on the archipelago was resumed after absolute stagnation. In 2021, the construction sector gained momentum and introduced to the market 3,500 new houses. Such tempo should keep pace in order to satisfy the growing needs and to prevent excessive rise in purchasing prices.