The downturn in the global property market in 2008 had catastrophic consequences.
This was true for most countries and quite a number of people. The United States of America saw some properties reduced to an almost giveaway price, sometimes less than 50% of the original asking price.
Property sales in Tenerife did slow down and prices did fall as well. Tenerife is quite a unique place and the vast number of different nationalities coming here helped stave off this slump to the same degree for the Tenerife property market.
The attraction of a beautiful sunny climate is a great factor. The temperature is an average 23 degrees with very little rainfall. Just a short 4 or 5 hour flight from most parts of Europe for winter sunshine. This attracted clients from Belgium, Holland, Germany, France, Scandinavia and Russia. It was not long before the people coming here from other colder countries decided to buy a property in Tenerife. It makes great sense to buy Tenerife property if you are coming here regularly for a sunny escape. You may be able to get a good rental income from the property as well as the property appreciation. If you buy a property in Tenerife which is considered a good location, near the beach and shops then the price will be a little higher. The rental of the property will be easier and you will have more occupancy.
Prices do go up and down but lets face some facts, if you look back at prices over the longer term, say over 10 years then property investment is still one of the best available. My first Property in Tenerife cost less than €60,000 in 1995, by 2006 the same properties were selling for around €175,000 and in the credit crisis the prices have fallen to an average of around €130,000 making a loss for the people buying a property in Tenerife in 2005 lose around €50,000 in this short term. On the other hand, those who could afford to buy 3 properties in Tenerife in 1995 would have made more than €180,000 even if they sold them now, and €300,000 if they sold at the top of the Tenerife property market in 2006.