The Ultimate Guide to Buying Properties in the Canary Islands

The Canary Islands, a Spanish archipelago off the northwest coast of Africa, are renowned for their year-round sunshine, volcanic landscapes, and relaxed island lifestyle. Whether you’re dreaming of a beachfront villa, a modern apartment with ocean views, or a tranquil countryside finca, the Canary Islands offer something for everyone. If you're considering buying a property in this subtropical paradise, this comprehensive guide covers everything you need to know.

Why Buy a Property in the Canary Islands?

There are many compelling reasons why the Canary Islands have become a hot spot for property buyers from all over the world:

Year-Round Climate: With mild temperatures and sunshine throughout the year, the Canary Islands offer one of the best climates in the world—perfect for both holidaymakers and full-time residents.

Laid-back Lifestyle: Life in the Canaries moves at a slower pace. With friendly locals, vibrant culture, and a strong sense of community, the islands are ideal for those seeking tranquility and balance.

Attractive Property Prices: Compared to mainland Spain, the Canary Islands often offer better value for money, especially when it comes to coastal and resort-style properties.

Tax Advantages: The Canary Islands benefit from a special tax regime (Régimen Económico y Fiscal - REF), including lower VAT (IGIC) and other financial incentives.

Easy Access to Europe: As part of Spain and the EU, the islands are well-connected to major European cities by air, making them easily accessible for weekend breaks or longer stays.

Types of Properties in the Canary Islands

From modern apartments in bustling resort towns to secluded country homes nestled among volcanic hills, the Canary Islands offer a wide range of property types:

Apartments: Popular in tourist hotspots like Playa de las Américas or Puerto Rico, apartments are ideal for rental investment or easy lock-and-leave second homes.

Villas: Often located on the outskirts or in upscale developments, villas provide privacy, pools, and stunning views—perfect for family living or luxury escapes.

Fincas and Rural Homes: Traditional Canarian country houses are ideal for buyers looking for peace, space, and a connection with nature, often located inland on larger plots.

Townhouses: These are common in both historic areas and newly built developments and offer a balance between community living and private comfort.

New Developments: In areas like Gran Canaria or Tenerife, there are plenty of new-build projects with modern amenities and eco-conscious design.

Where to Buy Property in the Canary Islands

The archipelago consists of seven main islands, each offering unique landscapes, lifestyles, and property opportunities. Here are some of the most popular:

Tenerife

The largest island, known for Mount Teide, offers vibrant cities, top resorts, and charming mountain villages. Areas like Costa Adeje, Los Cristianos, and Santa Cruz de Tenerife are hotspots for buyers.

Gran Canaria

Known for its golden sand dunes and cosmopolitan capital Las Palmas, Gran Canaria is a top choice for digital nomads and retirees alike.

Lanzarote

With its unique volcanic scenery and whitewashed houses, Lanzarote appeals to those looking for minimalist aesthetics and tranquility. Costa Teguise and Puerto del Carmen are top picks.

Fuerteventura

Famous for its windswept beaches and world-class kitesurfing, Fuerteventura is perfect for active lifestyles. Popular property locations include Corralejo and Caleta de Fuste.

La Palma

This green island is ideal for those seeking eco-tourism, stargazing, and rural retreats. It’s less touristy, making it a haven for peace and privacy.

La Gomera & El Hierro

Smaller and quieter islands, ideal for off-grid living or eco-conscious buyers.

La Graciosa

Spain’s newest inhabited island is tiny, peaceful, and utterly unique—though property here is extremely limited and in high demand.

Legal Considerations

As with buying property anywhere in Spain, purchasing in the Canary Islands involves specific legal requirements:

NIE Number: You’ll need a Foreigner’s Identification Number (Número de Identificación de Extranjero) to complete the purchase.

Legal Assistance: It is highly advisable to work with a local lawyer experienced in Canarian real estate to navigate local regulations and contracts.

Land Registry Check: Ensure the property is legally registered and has no debts, mortgages, or urban planning issues attached.

Taxes & Fees:

• Transfer Tax (6.5% for resale)

• Notary Fees

• Land Registry Fees

• IGIC (General Indirect Canarian Tax – 7% for new properties)

Residency: Property ownership doesn’t automatically grant residency, but purchasing at or above €500,000 may qualify you for Spain’s Golden Visa scheme.

Financing Your Property Purchase

Financing a property in the Canary Islands works similarly to mainland Spain, but with some unique points to keep in mind:

Mortgages: Spanish banks, as well as some international lenders, offer mortgages to non-residents. Expect a maximum Loan-to-Value (LTV) of 60-70% for non-residents.

Deposit: A 10–20% deposit is usually required upon signing a reservation or private purchase contract.

Currency Exchange: If you're purchasing in a currency other than the euro, consider using a specialist foreign exchange provider to save on transfer costs.

Additional Costs: Budget an extra 10–15% on top of the purchase price for fees, taxes, and administrative expenses.

Living in the Canary Islands

Whether you're buying for personal use, as a vacation rental, or for retirement, life in the Canaries offers:

• Excellent Healthcare: Spain’s public healthcare is accessible and highly rated, and there are many private options available on the islands.

• International Schools: Especially in Tenerife and Gran Canaria, you’ll find good international schools for expat families.

• Connectivity: High-speed internet and coworking spaces are widely available, especially attractive for remote workers.

• Outdoor Lifestyle: The climate and terrain make hiking, surfing, diving, sailing, and golfing year-round activities.

Vacation Rental Potential

The Canary Islands are a major tourist hub with over 13 million annual visitors. Buying a property for rental purposes can be highly profitable—if done legally.

• Vivienda Vacacional License: Required to rent your property short-term to tourists. The application process and regulations vary by island and municipality.

• Management Services: Numerous local agencies offer full property and rental management services for absentee owners.

• Seasonality: Unlike many European destinations, the Canary Islands have strong tourism year-round thanks to their climate.