Property Value (2003-03-05) (www.immo7.com)

Property Value Increase in the past years

In the lookup table 1 we see the evolution of thehousing value between the years 1997 y 2001. These values and the information regarding the offer of new houses are based upon the public available statistics made by the "Instituto Canario de Estadística (ISTAC)" (Canarian Institute of Statistics).

The price per square metre for new constructed houses in 1997 was with 702 Euro/sq.m 12,5% higher than used houses (624 Euro/sq.m). Every year the value of the houses increased at least 10% with little difference between new and used. The percentage increase in the year 2000 reached the 18,4% in new houses and 15,8% in used houses registrating a record.
The new constructed houses in the year 2001 had an average value of 1.193 Euros/sq.metre which is +70% compared to 1997 and the average value of used houses was 1.064 Euros/sq.metre (+71% compared to the same year. If we compare the evolution through the years we can confirm that there is a huge increase in the value of housings and therefor of the price for buyers. Although it's not possible to know exactly the percentage of increase there will be in the future we can almost be sure that it will be increasing steadily.

The lookup table 2 shows the evolution of the housing in cities of the Canary Islands with over 100.000 inhabitants between the years 1997 and 2000. In general terms the average price of new houses is higher than used houses. In Las Palmas de Gran Canaria the prices are also higher than those of La Laguna or Santa Cruz de Tenerife. From 1997 and 2000 the percentage increase of houses was 65,6% (new houses) and 47,3% (used houses) in Las Palmas making it far more higher than Santa Cruz de Tenerife or La Laguna.
Contrary to Las Palmas the percentage growth or evolution of houses in La Laguna and Santa Cruz de Tenerife between 1997 and 2000 was higher in used houses than in new ones. In the lookup table 3 we can see the corresponding statistic.

To have a correct understanding from the evolution of the housing prices we have to know how much of the new houses and how many of the used houses are actually offered in the real estate market. The lookup table 4 shows the housing totals and in the next column the number of them won by building works or refurbishment. In 1992 the real estate market had 6.847 new houses registered and this number increased up to 23.877 in 2001. The greatest difference happened in 1995 with a percentage increase to the previous year of 40%. However, the trend started to fall in 2000 with less houses in the market than the previous year. The percentage of the refurbished houses in the real estate market, compared to the totals, was only 3% and 8% between 1992 and 2001.

We can also state that the evolution of the increase in housing value through the past years has been steadily rising bu approximately 10% per year. In Las Palmas this average was higher and in Santa Cruz de Tenerife only the new built houses increased the average price.
One of the main reasons for this situation is the law of offer and demand. The record was established in 1999 with over 27.165 new houses in the real estate market. In the following years the situation and trend started to revert although this can be seen as an advantage to stop the saturation of the market and to limit property speculation. The price of housing depends on this law of offer and demand and thanks to the constant population growth of the Canary Islands it is expected to continue increasing.

Topical Real Estate Offers    Tips for buying houses    Property Value