The real estate market in southern Gran Canaria faces a scenario of technical uncertainty due to the cooling of its main historical driver: German buyers. With the Bundesbank lowering its growth forecast for Germany to 0,6% for 2026, the traditional German dominance in areas like Maspalomas, Playa del Inglés, and Mogán is entering a period of observation. After years of contraction, the German economy promises a "gradual" recovery, but slow GDP growth and inflation that refuses to fall below 2% are forcing small and medium-sized German investors to postpone their plans to acquire a second home in the islands.
The residential market in Maspalomas and Meloneras closed December 2025 in the midst of a correction phase, according to Idealista, with the price per square meter at €5.242/m², marking a definitive departure from its peak. Although this figure reflects robust annual growth of 12,0% compared to December 2024, the last quarter has been a cold shower for sellers: prices have fallen by 3,5% month-on-month and 9,1% quarter-on-quarter, leaving property values 12,2% below the all-time high reached in July 2025 (€5.969/m²). This trend confirms that the real estate boom in southern Gran Canaria is giving way to economic reality, adjusting expectations for a market that appears to have exhausted its upward trajectory for this year.
Despite this economic downturn in their home country, prices in the south of the island show no signs of slowing. In municipalities like San Bartolomé de Tirajana, housing values remain pressured by an extremely limited supply, keeping the price per square meter at record highs. The profile of the German buyer is changing: while the average saver is holding back in the face of rising living costs in their country, high-net-worth buyers—immune to GDP fluctuations—continue to see southern Gran Canaria as a safe haven. However, the local real estate sector is beginning to notice that closing times are lengthening, as it awaits the expected increase in real wages in Germany, projected for the end of 2026, which is expected to restore consumer confidence.
The relief for local property owners and developers lies in the fact that the German economy will "return to positive growth" starting in the second quarter of 2026, according to Bundesbank President Joachim Nagel. This recovery forecast, based on public spending and exports, suggests that the Canary Islands real estate market only needs to weather a period of moderate demand. Meanwhile, the southern residential sector is relying on diversification, filling the gap left by German buyers with those from other parts of Europe who, for now, maintain the financial strength that Frankfurt is still struggling to regain.
The outlook for the coming months is one of tense stability. The real estate market in southern Gran Canaria has proven resilient to external crises, but its dependence on German savings is a tether that is difficult to ignore. If inflation in Germany slows more than anticipated, as the central bank warns, the Canary Islands' residential market will have to rely on product scarcity for growth rather than a massive influx of German capital, at least until the European economic cycle regains the cruising speed promised for 2027.
