Rental prices surge in the Canary Islands crossing €12/sqm mark

The Canary Islands witnessed a notable surge in rental housing prices in February, marking a yearly increase of 10.8% compared to February 2023. According to data from the Fotocasa Real Estate Index, the average rental cost has soared to 12.91 euros per square metre, surpassing the €12/sqm mark, but is much higher in the main tourist destinations across the islands.

This spike in prices represents the lowest year-on-year increase recorded in the past 17 months, indicating a slowdown in the upward trend since October 2022. Despite this, monthly data still shows a modest 0.8% rise in rental prices across the islands.

The housing market trend in Spain mirrors this escalation, with rental prices soaring by 7.3% year-on-year, averaging 12.27 euros per square metre in February. This marks the first time in 17 years that the national average has surpassed the €12/sqm mark, signifying a concerning trajectory in the rental market.

María Matos, the Director of Studies and spokesperson for Fotocasa, expressed apprehension over this unprecedented surge in rental prices. She emphasised that since 2006, when records began, the rental cost had never exceeded €12 per square metre. Matos warned that this continuous escalation raises serious concerns.

In February, rental prices surged across all regions of Spain, with eight areas experiencing double-digit increases. Leading the pack were La Rioja (15.2%), Madrid (15.0%), and the Balearic Islands (14.4%).

Fotocasa also identified nine regions that set record new highs for maximum rental prices per square metre in February in their region. Catalonia led the list at €16.45, followed by Madrid at €18.29, and the Balearic Islands at €17.19, which are the two most expensive autonomous communities for renting property.