Renting in Spain: why Spaniards take longer than other Europeans to leave their homes | Economy and business
There is one big problem that has a major impact on the lives of young people in Spain – the labor market, with its plagues of temporary contracts, high unemployment and low wages. The impact of this problem is reflected in the fact that most Spaniards still live with their parents until at least the age of 30. To talk about the lives of young people is to talk about property – their desire to buy or rent and the economic effort required to do so.
1. More young Spaniards live with their parents than in most European countries. The average starting age is around 30, which is three years older than the European average. According to data from the European Union’s statistical office Eurostat, 64% of people aged 25 to 29 live with their parents in Spain, a figure surpassed only by Italy, Greece and a number of countries in the Balkans. This is up to tripling the rate in France (17%), the United Kingdom (25%) and Germany (30%) and in stark contrast with the Nordic countries where only 5-6% in this bracket age still live with their parents.
The number of young people in Spain who have not become self-employed has increased with the fallout from the 2008 financial crisis. Now, with the coronavirus pandemic, the number will almost certainly rise again, as data from the Observatory of emancipation. There are many reasons why young people stay in the family home for so long, but the most obvious is money. According to a survey by the government youth institute Injuve, 75% of young people cite the lack of economic stability as a reason for not moving. Those who go it alone often have only a small amount of money to live on after the rent has been paid: 34% of self-employed 25-29 year olds are at risk of poverty or social exclusion, more than in any other European country . Union (EU) countries, according to Eurostat.
2. Young people increasingly live in rented accommodation. Another big change in recent decades has been the growing preference for renting over buying a home. In 2006 and 2007, there were twice as many owned dwellings as rented dwellings among households where the main employee was under 30 years of age. But this ratio has reversed: today 50% rent and only 25% buy.
Another significant trend is that young households are now twice as likely to live in housing that has been offered to them free or at a reduced price. In 2006, this type of installation represented 10 to 15% of young households, whereas today it represents 26% of the total. In other words, one in four young households depends on the goodwill of another.
There are 600,000 households where the main wage earner is 30 years old, which represents only 3.5% of the total, almost half of what it was 15 years ago. There are also fewer households inhabited by those aged 30 to 44 (26%), while the number of older households has increased – those with the main breadwinner between 44 and 65 years old represent 41%, and households dependent on a person of retirement age now account for 29% of the total.
The growing preference for renting is also evident in households between the ages of 30 and 44, although home ownership is still predominant (60%) in this demographic. Spain continues to be a country where more families own their own home compared to the EU average – 76% versus 70%, according to Eurostat.
3. Paying rent is an effort for 50% of young households. In Spain, many people live in rented accommodation because they cannot afford to buy – although they would like to – and are forced to use the family budget to pay the monthly rent. In this respect, Spain’s economic effort is among the most important in Europe.
For example, data on couples with one child living in a rented property in Spain shows that almost 30% of their income on average goes to rent, which is more than in any other EU country. Likewise, the data for households consisting of a couple without children or of an adult and a child are the worst in the whole of the EU.
It is generally not recommended to spend more than 30% of household income on rent. But in Spain, the majority of people living in rental housing pay more than 30%. Based on microdata from the Living Conditions Survey, we calculated that 46% of households living in properties rented at current market prices have to spend more than 30% of their income on rent. This puts them in a situation where they are economically overburdened. As far as young people are concerned, the figure rises to 51%.
The effort is particularly intense in the big cities. In Madrid, 58% of all households in rented accommodation spend more than 30% of their total income on rent; in Catalonia this figure is 49% and in the Balearics it is 47%.
Of course, differences appear depending on the composition of the household. Sixty-nine percent of single mothers or fathers are economically overworked, as are 75% of women living alone and 50% of families with three or more children.
4. For buyers, the home exit price is approximately â¬ 1,600 per square meter. The difficulty in leaving home is simply that young people tend to have low incomes and properties are expensive. Since the economic crisis of 2008, the value of goods per square meter has been linked to the trend in unemployment. Prices stopped rising when unemployment began to rise in 2007. At its peak, the value per square meter averaged over â¬ 4,000 in Madrid and Barcelona, ââfalling back to â¬ 2,500 in 2015. The economy was improving then. There was more work and prices have increased further and are now around â¬ 3,200 per square meter in Madrid and Barcelona.
The most expensive provinces are Gipuzkoa and Vizcaya in the Basque Country, Madrid, Barcelona and the Balearic Islands, where the sales value per square meter is 40% higher than the national average. The same goes for rents. The average cost of renting a 75 square meter property is around â¬ 875 in the province of Madrid and around â¬ 750 in Barcelona, ââbut only â¬ 315 in Lugo in Galicia or CastellÃ³n in Valencia.
Big cities are particularly expensive. As can be seen from this link showing an alternative map, the typical apartment in Madrid and Barcelona costs almost â¬ 850 to rent, while in Malaga it is around â¬ 620; in Valence, 520 â¬; and in Murcia, 460 â¬. These differences are accentuated according to the districts or the communes. In Madrid and Barcelona, ââthe gaps are becoming enormous; in both cities, there are hundreds of neighborhoods where the average rent for an apartment is less than â¬ 700, but then around ten neighborhoods where there is nothing below â¬ 2,000.
Finally, the search engine below allows you to consult the data of hundreds of places across Spain. There are municipalities around Barcelona, âânear Madrid and in the Balearics where the price per square meter exceeds â¬ 3,000 and where the highest rents, 25% more expensive than the national average, exceed 15 euros per square meter. In contrast, in regions in the interior of Spain, such as Villarrobledo in Albacete or Puertollano in Ciudad Real, the price per square meter barely reaches 600 â¬.
english version by Heather Galloway.