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Date Published: 23/07/2024

Rental costs soar to all-time high in Spain as salaries stagnate

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The cost of living crisis in Spain has pushed the average monthly rent over 1,000 euros

Rental costs soar to all-time high in Spain as salaries stagnate

Immigrating to Spain is still the dream for so many people, but the ongoing cost of living crisis is throwing a different light on what was once seen as the ideal lifestyle. Everything from groceries and clothing to electricity and fuel is going up, and the latest essential expense to join this unhappy parade is rent.

As of June, the ‘Fotocasa Inmobiliario Index’ reported that rental prices in Spain have reached an all-time high, with the average cost surpassing 1,000 euros per month. And given that the typical pay packet in Spain falls somewhere near the middle or slightly below average in Europe, renters are quickly being priced out of the market.

The surge in rental prices is a nationwide trend, with all of Spain’s autonomous communities experiencing an increase. The data reveal that the average cost of renting a home in Spain has climbed to 11.41 euros per square metre, which translates into an annual increase of 13.6%.

The high rental costs have a direct impact on the salaries needed to live comfortably in Spain, especially in the capital cities. A single person living in Madrid, for example, would need to earn a gross annual salary of 31,200 euros just to cover their basic expenses, including rent, utilities and groceries.

In Barcelona, the required salary is only slightly lower at 30,000 euros per year. These figures highlight the financial strain that residents, especially those living alone, may be facing in these expensive cities.

It’s worth noting that the minimum wage in Spain is just 1,134 euros per month, less than half what the experts believe a person needs just to keep a roof over their head and food in the fridge.

The situation is even more challenging for those looking to rent in popular coastal areas. In cities like San Sebastián and Ibiza, the required salaries to live comfortably soar to 40,800 euros and 43,200 euros, respectively.

The high rental prices can be attributed to several factors, and none of them are an easy fix. One significant contributor is the post-pandemic rebound in demand for housing, as people return to office-based jobs after a long hiatus. But on the opposite end of the spectrum, the rise of remote work since Covid has also led to a shift in housing preferences, with many seeking more spacious accommodation or locations outside of city centres. This change in dynamics has put pressure on the rental market, driving up prices.

Confronted with this challenging situation, experts recommend several strategies to make ends meet. One suggestion is to consider shared living arrangements, as splitting rent and utilities can significantly reduce individual expenses.

Additionally, tenants are advised to be vigilant and proactive in their search for rental properties, as acting quickly when a well-priced property becomes available can make all the difference in a competitive market.

Overall, the experts stress that rent should account for a maximum of 30% of a person’s salary, a budget limit that’s becoming increasingly difficult to stick to anywhere in Spain.

Also of interest: Barcelona to raise tourist tax for stopover cruise passengers

Image: Me dais poco/Flickr

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