PROPERTY

Run to the sun

Located off the coast of Africa, the Canary Islands are a stalwart of the summer holiday brochures. But while they have not been immune to a slowdown in the Spanish property market, they are still as popular as ever with European tourists and property buyers, says Shane McGinley p> [ 12 Number (in millions) of visitors
to the Canary Islands each year]

For new buyers first entering the overseas property market the Canary Islands, home to the famous cute yellow birds, are some of the safest and most attractive locations to start exploring.

For one, the islands are popular fixtures in sunny holiday brochures – they have temperatures ranging from about 18ºC in the winter to about 30ºC in the summer. Two, they are easily accessible with regular flights direct from many parts of Europe and have a welldeveloped infrastructure. So sea, sand, sun and good logistics and communications – the only real question left is which of the volcanic islands to choose?

Part of the Kingdom of Spain, the Canary Islands are an archipelago consisting of seven islands off the coast of North-Western Africa. Many people think the islands are named after the popular songbird but it’s the other way around – and the Canaries’ original Latin name, Insula canaria, actually means Island of the Dogs.

In 2005, the Spanish government decided to commit a huge slice of their tourism promotion budget to the Canary and Balearic Islands, and it has certainly paid off !

The islands’ eight international airports, 41 marinas, 17 golf courses and numerous golden beaches attract approximately 12 million visitors each year, and the area is Spain’s third most-popular tourist destination, with the UK representing the largest percentage of holidaymakers, followed by Germany, Belgium, the Netherlands, Sweden, Finland, Denmark, Norway, Italy, France, Austria, Ireland and Switzerland. According to a Spanish Property Insight Report, the traditional buyer is retired and spends about 3–6 months per year in their island villa.

NEED TO KNOW
Recent issues in the Spanish property market such as planning corruption allegations, a scandal involving the mayor of Marbella, a general oversupply and overdevelopment of rental apartments in some of the Costas and low rental yields, have led to a general slowing down of the once buoyant Spanish market.

In 2007, Spain recorded a 5.31% house price growth, the lowest rate of increase in nine years. Higher interest rates and rental taxes have also impacted on its performance. However, Spain has still remained an attractive market overall and in its end-of-year report, property website Overseascafe.com found that although interest had dropped in Spain in 2007 it was still the second most-popular country among those searching the site for overseas homes.

As part of Spain, the Canaries have not been immune to the overall problems in the mother country – but they have not been as dramatic and, like the homeland, prices have varied from region to region with some performing better than others. Also, as in Spain, this does mean that now is the perfect time for buyers looking for a property in the Canaries – with prices low at the moment.

“When sourcing investment property for people, we always see market turmoil as a potential opportunity because homes on most of the Canary Islands are now significantly cheaper than they were a year ago,” says Empire Consulting director Michael Bolger.

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