Hi!
It is great to see that you want to make the move! I suppose the answer to your question depends on what you fancy, really. And also on what kind of business you want to set up!
As long as you move slightly away from the tourist areas the prices should not be silly. Personally, I like Puerto de la Cruz. Good weather during most of the year and has the feel of a real town where people live, and not holiday. Housing might be a little more pricey, but literally 5 minutes drive in any direction and it gets cheaper. El Toscal has some nice villas, for example. There is also a healthy expat population, if you ever feel like hearing a familiar accent, the British library, etc. You can still get a great taste though of the Spanish way of living.
If you fancy the South there are plenty of towns apart from the tourist resorts, but close to them, so you can still enjoy the beaches and beautiful evening walks. Chances are there will be more trade in the south as well.
So yeah, what are your thoughts/preconceptions?
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