At the end of 2019 and the start of 2020 things in the world of real estate were trundling along nicely, getting into the groove and coming to the end of the busy period which normally runs from October through to March, April every year…then suddenly, all of that came to a halt.
Flights and travel were stopped with a jolt and so tourists and hence property buyers were stopped in their tracks, sellers couldn’t come over to sign their paperwork even if they were halfway through selling their property, prospective sellers couldn’t come over to put their property on the market, even if they could, where were the buyers going to come from?
As time went on, things were still difficult to manage with the Covid restrictions but any sales that were started before lockdown were able to move a bit, power of attorneys became more common place as sellers were willing to send over a power of attorney to their trusted person here in Tenerife to continue the sale from where it had been put on ice in the middle of March and from there the market was able to start moving again.
Yes, the market started moving again but very slowly and mainly from the perspective of completing sales that had already been started, the idea of putting a property on the market at that time was pretty much inconceivable because there weren’t going to be many buyers around…if any, so what would have been the point?
In June or July 2020 there was a promise of a release of lockdown which started an influx of people showing more interest in properties for sale and we were having good dialogue with these potential buyers until Tenerife was put on a red list of some sort and then pop…it all went quiet again, I distinctly remember that we had 3 buyers due to come over who were ready to buy and they all had to cancel their travel plans and hence their purchase at that time.
And I’m sure we weren’t the only ones in this position, this sort of thing must have gone on throughout the Canary Islands…possibly the world, but I think for those people who don’t rely so heavily on buyers and sellers from other countries like us, sales numbers probably didn’t take a dive – in fact, looking at the National Institute of Statistics for Spain, the number of sales that took place throughout Spain as a country wasn’t down much but the Balearic and Canary Islands were both hit numbers wise, so we can assume that as travel was more difficult to the islands, sales numbers fell.
As we got to the end of 2020, things were still looking bleak on the tourism front, which as you can imagine still had a massive effect on the property market here in Tenerife, but at this time, we had people putting their properties up for sale, reading between the lines, there was a glimmer of hope that after Christmas we’d be getting back to some sort of normal…buyers would be coming back in their droves…only they didn’t.
It’s true, they started coming back a year after lockdown, March, April 2021 saw the start of more tourism from Europe and with that brought more buyers…some were almost filled with a pent up urge to buy something here in the hopes that if there was another worldwide lockdown, that they’d be locked down here in Tenerife.
As time has gone on this year, 2021 has improved no end and although I’m certainly not saying we’re back to normal regarding Covid travel problems, the property world has certainly been very busy and I could even say that it’s made up for a lot of lost time. I still think that there are plenty of people that feel that their prospective purchase in Tenerife was stifled by Covid and they’re coming here now with a stronger feeling than ever that they’re going to buy something, and this I can only imagine, will be supporting property prices even more.
Over the past 4 or 5 years, Brexit has obviously had an effect on the Tenerife property market but nothing like Covid and even now, people are still a bit scared of Brexit but now we’re getting back to more of a normal way of life in this post-Covid world as it seems to be called, the market has almost been turned back on like a tap.
With all of this market and sale imbalance over the last 18 months or more, it’s got have affected property prices hasn’t it? – Nope, not really.
The thing is that most of the second home owners here in Tenerife are mortgage free. That means that the cost of running a property here is reasonably minimal for existing owners paying insurance, community fees, annual property tax and a minimal amount of electric and water bills really hasn’t been a hardship for Tenerife property owners and as such, there’s never much pressure to sell their property here.
It’s true to say that there are a few deals to be had but it’s not as if the bottom has fallen out of the market, we’ve still got the weather, the island life and the generally lower taxes, so Tenerife is still a great place to buy property as a holiday home and even a second home, despite Brexit for the British buyer…yes, there’s a 90 day rule but how many holidays have you had that have been more than 90 days? Not many if any is my guess.
So, where does this leave the market in general? Buyers are back with a vengeance, there are plenty of potential buyers still due to be coming over before the end of 2021, which if the majority of those end up buying, then as an industry, we’re pretty much back on our feet and back to normal.
Property prices haven’t taken a dive, more property is coming on to the market as I write this, that’ll almost certainly be a mix of sellers feeling it’s the right time to sell as we’re coming into the winter and hence busier months, and also there’ll be some sellers who are feeling that they’d just like to sell in general.
Sales figures wise, the year will be down, that’s inevitable due to the dodgy start to the year and lack of people being able to travel but once again, we can see new agents popping up in all of the major hotspots, where before they closed their offices and worked from home or went back to their home country to live for a while, so there’s another indication that the industry is coming back.
Things will be back to normal next year, assuming that we don’t have a lockdown again this winter because if we have another lockdown, that might well put the mockers on it for the end of the year.
During 2020, many people speculated that property prices in Tenerife were going to fall and I was even mocked personally for saying that property prices were as strong as ever, one commenter even said that if we wait for 6 months, prices will be 50% of what they were…some people are ever hopeful.
So, if you’re thinking about buying a property in Tenerife, it’s true to say that Covid has affected us, but I think in more of a positive way than in a negative way. Tenerife is on the up again, yes we lost a few businesses along the way, but that’ll make way for new and different businesses for visitors to enjoy in the coming years.