It’s one of those questions that pops up almost daily in emails, WhatsApps, and chats over café cortados: “Where’s the Tenerife property market heading this year?”
Fair question. Especially after the curveballs of the past few years, post-COVID demand, cost-of-living increases, interest rate hikes and the usual layer of Canarian red tape.
So here’s my take: what’s happening now, what’s driving it, and what we’re likely to see through the rest of 2025.
First, the mood on the ground
Let’s start with what it feels like as an estate agent in Tenerife, because stats alone don’t tell the full story.
For us, so far, 2025 has had a very “stop-start” rhythm.
January was quiet, February picked up a bit, mostly enquiries from Northern Europe, especially Germany and the Nordics and by March/April, viewings were back in full swing, particularly in the South.
But here’s the thing: offers have been slower. Buyers are more cautious. They’re asking sharper questions and negotiating harder.
That’s not a bad thing, it means we’re in a more balanced market and of course, this could mean some sellers, particularly those still chasing the high prices we’ve seen over the last couple of years, are having to come back down to earth.
Prices: steady, but not skyrocketing
If you’re expecting a property boom in Tenerife this year, I’d say don’t hold your breath. We’re not in a crash, and we’re certainly not in a surge. What we are seeing is a bit of levelling out.
Every month I do a video which I’ve called the Tenerife Market Snapshot, you can follow my YouTube channel here if you’re interetsed…and recently, although we’ve seen prices rising, the month of May saw very little movement eitherway.
- Resale apartments in touristic areas are holding their value fairly well, especially those with holiday let licences (VV)…in fact, that’s often one of the first questions we get asked – has it got a VV licence.
- Older properties in non-touristic zones? More negotiable.
- Luxury villas in prime areas? Still commanding a premium, but buyers are taking longer to commit.
What’s driving the market right now?
Here are the main levers shaping what we’re seeing:
1. Interest rates
Still a factor, but slightly easing. Spanish mortgage rates have come down a touch, and there’s hope for further ECB cuts this summer. That’s giving some buyers the confidence to move.
2. Foreign demand
Still strong, particularly from Germany, Belgium, Scandinavia, and (to a lesser extent) the UK. British buyers haven’t disappeared entirely but the 90/180 day rule is still putting a dampener on some people’s dreams…others realise that there’s still a chance that things will get back to as they were or don’t feel that they need to stay here for more than 90 days every six months.
3. Shortage of quality listings
This is the big one. There’s no shortage of properties on the portals, but as I’ve written about before, many of them are overpriced, poorly presented, or simply not what people want. Good-value, well-located homes are going quickly.
4. Local bureaucracy
Nothing really new here, but it’s worth saying: delays in town halls and the Registro still slow things down and the continuous backwards and forwards with what’s happening with the VV licences is holding back loads of people from buying.
Forecast: What to expect for the rest 2025
Here’s the most realistic take I can give you:
- Prices will stay broadly stable in the mid-range resale market.
- High-end property will remain buoyant, especially in areas like Costa Adeje, Abama, and La Caleta…but as always, fewer number of sales.
- Rural or inland homes will need sharper pricing to sell….some sellers are thinking that the prices they see on the coastal towns should be reflected in the hills or inland…they don’t.
- Buyers will continue to be value-focused, no surprise here but they’re not rushing in like they did post-pandemic.
- Holiday let rules may tighten, we’re still waiting for a good black and white decision as to what’s happening. Keep an eye on local Ayuntamiento updates.
We’re not expecting a boom. But we’re not expecting a bust either. It’s more of a sift and sort market, where the well-presented, sensibly priced homes will still move.
Tips if you’re buying or selling
If you’re buying in Tenerife this year:
- Be ready to move fast on the right property
- If you need a mortgage, get yourself agreed in principle.
- Ask about VV status if you’re planning to rent
If you’re selling:
- Don’t assume last year’s valuation still holds
- Work with an agent who gives honest feedback
- Tidy, declutter, and make your listing photos count
It’s really not rocket science, but those small things make a big difference.
So, in short, this year’s property mood isn’t euphoric, but it’s quietly confident.
Buyers are doing their homework. Sellers are realising they need to meet the market, not fight it, so things are on the change.
And that’s no bad thing, it means deals are still being done, just that they just take a little longer, and everyone’s a bit more realistic.
If you’re thinking of buying, selling, or just keeping tabs on the Tenerife market, feel free to reach out or subscribe to the Tenerife Market Snapshot videos or any of my newsletters…or just keep an eye on this space, I’ll be posting regular updates as things evolve.
