Buying Your First Home in Tenerife: Step-by-Step Guide

Buying your first home in Tenerife is within reach if you break the process into phases: first you work out how much you can save and borrow, then you choose an area and property type, and finally you budget for the closing costs and taxes. This guide walks through every step with first-time buyers in mind, covering the grants and conditions currently available in Canarias.

Savings and budget: how much you actually need

Before browsing listings it pays to put numbers on the table. The rule most banks use is simple: your mortgage payment should not exceed 30% of your net monthly income. If you and your partner bring in 2.800 euros a month combined, the comfortable repayment sits around 840 euros.

Prior savings are the other key factor. Historically you needed to gather 20% as a down payment plus 10% for costs — around 60.000 euros for a 200.000-euro home. The good news is that the new government-backed guarantees significantly lower that barrier, as you will see below. Even so, always keep a buffer for unexpected expenses.

Also review your credit history and avoid taking out other loans just before applying for a mortgage. A clean, stable financial profile carries the most weight when the bank decides how much to lend you.

The mortgage for your first home

The first-home mortgage is the step that raises the most questions, and rightly so: terms vary considerably from one bank to another. Request several offers and compare three things above all: the interest rate (fixed, variable or mixed), the tie-in products they require (payroll, insurance, cards) and the arrangement or early-repayment fees.

The most important development for first-time buyers is the Hipoteca Joven Canaria, approved in May 2026, which allows young people aged 18 to 40 to finance up to 95% of their first home's value. In practice this means you no longer need to save the 20% down payment — only the costs and taxes: the biggest change for first-timers in years.

Practical tip: get a pre-approval before you start viewing properties. Knowing exactly what you can afford makes you faster to act when the right home appears, and sellers take an offer backed by the bank far more seriously.

Grants and guarantees in Canarias

Canarias actively supports the purchase of a primary residence, so check what you are entitled to before signing anything.

• Young homebuyer grant: the Gobierno de Canarias offers up to 11.000 euros, capped at 20% of the purchase price, for buyers under 35 who will use the property as their permanent primary residence.
• Guarantee and Hipoteca Joven: the public guarantee covers the down payment you previously had to save yourself, which is why financing can reach 95%.
• Typical requirements: being registered (empadronado) in Canarias for several years, it being your first home, and the mortgage covering a significant share of the purchase price.

Applications open and close on specific dates and the budget is limited, so it is worth having your documents ready and checking the official Gobierno de Canarias website to avoid missing out by just a few days.

Finding a home: areas and property types

With a clear budget the most exciting part begins. Tenerife is an island of contrasts and location shapes both price and lifestyle considerably. The south (Costa Adeje, Los Cristianos, El Médano) offers more sunshine, tourist amenities and strong resale demand; the metropolitan area (Santa Cruz and La Laguna) is more urban and practical for work; and the north (Puerto de la Cruz, La Orotava) is greener and quieter, often with more accessible prices.

When it comes to property type, each option suits a different life stage. A flat or studio is usually the most common entry point for a first-time buyer because of price and low maintenance; a duplex or bungalow gives more space if you are planning for a family. Always check the community fees, which in complexes with pools or gardens can add up on your monthly outgoings.

You can start comparing real prices by area in our property search or focus on apartments for sale if you are looking for your first home. When you visit, pay attention to details photos do not show: the orientation (in Tenerife the south gets sun almost all year), build quality and proximity to supermarkets, schools and bus routes.

A tip we give first-timers: visit the area at different times of day. A quiet street on a Tuesday can feel very different on a Friday night.

Costs and taxes: what gets added to the price

You need to add between 8% and 12% in costs and taxes on top of the property price, so budget for this from the start.

• Taxes: if you buy a resale property you pay ITP, which in Canarias has a reduced rate of 5% for a primary residence. For a new-build you pay IVA plus the Impuesto de Actos Jurídicos Documentados (IAJD) instead of ITP.
• Notary and Land Registry: both are compulsory to sign the deed and register the property in your name.
• Gestoría and valuation: the bank usually requires an official valuation, and many transactions use a gestoría to handle all the paperwork.

If you are not a Spanish resident you will need a NIE (Número de Identificación de Extranjero) for any official procedure. Hiring a specialist lawyer is money well spent: they will confirm the property is free of liens and debts before you sign.

Tips for first-time buyers

Buying your first home mixes excitement with nerves, and the nerves push you to decide quickly. These tips help you keep a clear head:

• Do not fall in love on the first visit. Seeing three or four properties gives you the perspective to properly assess the one you like.
• Negotiate the price. If a property has been listed for months or the seller is in a hurry, there is almost always room to negotiate.
• Think long term. A home is a years-long investment: consider whether it will still work if your plans change — remote work, children or reduced mobility.
• Lean on local professionals. An agent who knows the island filters out properties that do not suit you and often has access to homes before they are publicly listed.

Frequently asked questions

When is a purchase considered a first home?

A first home is one you buy without owning any other property and intend to use as your permanent residence. That is the requirement that unlocks most grants and reduced tax rates.

How much ITP do you pay in Tenerife?

In Canarias the ITP for a resale primary residence has a reduced rate of 5%. It only applies to second-hand properties; if you buy a new build you pay IVA and IAJD instead.

How much do I need to save to buy my first home?

Under standard conditions you would need 20% as a down payment plus 10% for costs. However, with the Hipoteca Joven Canaria and the public guarantee, financing can reach 95%, so in many cases you only need to have the costs and taxes covered.

Is it worth buying a home in Tenerife?

For many buyers, yes: the stable year-round climate, constant rental demand and Canarias tax advantages make the island attractive both to live in and to invest in. The key is choosing the right area for your actual needs.

Take the step with someone who knows the island

Buying your first home is much smoother when someone guides you through every step. At Tu Nido Tenerife we have been helping buyers find their place on the island for over 20 years, with honesty and without rushing. You can meet the team and learn how we work and, when you are ready, get in touch so we can guide you from the first viewing to handing over the keys.