Lanzarote is a perennially popular destination for British and international tourists. Located just off the coast of North-West Africa this holiday hotspot enjoys sunshine all year round – delivering 12 months’ worth of rental returns for thousands of owners of vacation properties.
This popular Canary Island has a population of around 150,000 – with Brits and other sun-starved Northern European nationalities comprising around 15% of the residents.
Flights from the UK take just four hours, making Lanzarote one of the most accessible winter sun destinations for British holidaymakers.
Holiday home ownership on the island has boomed over the last decade, fuelled by cheaper budget flights and buoyant tourist demand – with over 3 million visitors touching down at the island’s international airport in 2019.
This growing market has also attracted a large amount of interest and investment from multinational hotel groups, sparking development and renovation projects in all of the main resorts on the island.
So where should investors seek a slice of the action be looking on Lanzarote? And what sort of property types are currently on the market?
Puerto del Carmen
Puerto del Carmen is the biggest resort on Lanzarote and is hugely popular with holidaymakers as it boasts a long stretch of golden sand beaches, hundreds of bars and restaurants and is also located quite close to the airport, reducing the transfer time to little more than 10 to 15 minutes.
Hotels and apartment complexes dominate the resort – which primarily caters to a tourist market seeking a straight-up beach holiday with plenty of nightlife and shopping thrown in.
As a result, studios and apartments based on managed holiday complexes are the most popular investment option here and it is rare to find many available for less than €100,000. Although local estate agents Atlantico Homes currently have an entry-level apartment with sea views available for as little as €87,000.
There is a smaller selection of holiday villas with pools available for investors with larger budgets and the best of these are located in two main areas – Los Mojones and Risco Prieto. The latter is situated on a hilltop overlooking the Old Town harbour – delivering fantastic sea views. Whilst the former is located closer to the main beach in the resort of Playa Grande. Prices here start north of €350,000 for a private villa with pool.
Villa prices are much cheaper in the resort of Playa Blanca, which is located in the south of the island, around 30km away from Puerto del Carmen.
Development here really took off in the 1990s and revolved more around the construction of independent two and three-bedroom properties with private pools, as opposed to the holiday apartment based model pursued in the ’80s in Puerto del Carmen.
As a result of this higher level of supply, prices are lower and investors can pick up a two-bedroom villa with a private pool from as little as €235,000.
Rental returns are equally attractive – as a property of this type can command a minimum weekly rate of £800 to £900 during low season, rising to as much as £2,000 during peak periods such as the summer holidays.
Costa Teguise is an entirely man-made resort developed under the aegis of the famous local artist Cesar Manrique – and is basically the close coastal cousin of the inland former island capital of Teguise.
Development here has been kept low rise, in accordance with Manrique’s ecologically led vision for the island. Which proved to be a big hit with Scandinavian and German tourists and investors during the 80’s – followed by the British from the 1990s onwards.
Some of the most attractive property here can be found in the Pueblo Marinero, which was designed by Manrique as a replica of a typical Canarian fishing village, located right by the main beach of Playa Cucharas.
Quite a few of the bungalows and apartments here have been snapped up by investors over the years, many of whom have converted them into attractive holiday rental properties. But demand greatly exceeds supply in this spot, which means it is rare for any of these properties to make it onto the market.
As a result, most investors tend to focus on apartments based on holiday complexes nearby – with typical prices here starting from around €90,000.