The Socialist Party warns that around 32,000 homes have disappeared from the residential market in just two years, urging the regional government to act quickly to regulate housing supply.
Santa Cruz de Tenerife – The Socialist Party (PSOE) has raised the alarm over what it describes as a serious imbalance in the Canary Islands housing market. According to the party’s spokesperson, Sebastián Franquis, more than 32,000 homes have shifted from residential use to holiday rentals in the past two years. He noted that this figure is roughly equivalent to all the public housing built in the islands over the last forty years.
Speaking in the regional Parliament, where the PSOE presented a new bill on large-scale property ownership, Franquis criticised the government’s housing policies, saying that the two decrees promoted by the current administration have worsened the situation.
Rising Costs and Market Pressures
Franquis highlighted that housing prices in the Canary Islands have risen sharply since May 2023, with sale prices increasing by 39% per square metre and rents by 21% as of September 2025.
He added that Canarian households now spend 55% of their gross income on housing, compared with a national average of 47%. “The reality of the market,” he explained, “is that large landlords already account for 8.2% of all housing stock, which is double the Spanish average of around 4%.”
Three Main Measures Proposed
The Socialists are proposing the creation of a registry of large property owners that would identify anyone holding more than ten dwellings. The party explained that a similar measure already exists in Catalonia, where it is considered an essential tool for monitoring what is happening in the housing market.
The second major proposal involves what the PSOE describes as a “fiscal rebalancing”. This would eliminate the property transfer tax (ITP) for homes valued at less than €200,000, while introducing progressive tax brackets ranging from 10% to 13%, depending on the value of the property.
Under this model, the effective tax rate would be lower than the current 6.5% for homes valued at up to €550,000. Above that threshold, the rate would increase, with a special 20% levy on large property owners and holiday rentals, regardless of the property’s price.
The third proposal calls for regulating the region’s right of first refusal and repurchase, particularly in cases where properties are being sold by companies or legal entities that own more than ten homes. According to the PSOE, this measure would help curb speculation and give the regional government greater control over major transactions in the housing market.
“Only the Previous Plan Is Delivering Homes”
Franquis, together with Socialist MP Manuel Hernández Cerezo, criticised the current government’s performance, stating that “only the projects initiated under the previous housing plan” – when Franquis was Minister for Public Works and Housing – are currently under construction.
The PSOE insists that urgent action is needed to restore balance to the Canarian housing market and to protect residents from rising prices and limited supply.
