Costs of buying or renting a home in Spain are rising

According to a study by idealista based on data from the second quarter of 2024, the share of household income needed to buy a home has increased to 23.1%, while it rose to 35.7% for rent. The tight supply and rising prices have pushed the rental burden to the recommended maximum, increasing by four percentage points over the past year.

Francisco Iñareta, spokesperson for idealista, commented: “As we predicted, the burden on families has increased again this quarter due to the continued lack of available supply in both the real estate and rental markets. They continue to face increasing pressure as demand increases and the supply of housing shrinks, driving up prices and causing increased stress. In the rental sector, the fatal consequences of the Housing Law and all the rental measures approved over the last six years are evident, despite the lack of political will to reverse them.

In terms of buying, the lack of supply has been highlighted by the decades-long stagnation in new housing construction in the most desirable areas, and the effects of this are now being felt. Unfortunately, new housing construction takes years, so it is unlikely that large areas of new housing will emerge in the short to medium term that will ease market tensions and drive down prices.”

Barcelona, ​​​​the provincial capital with the highest rental burden

There are 11 provincial capitals where the rental burden for a two-bedroom apartment exceeds the 30% recommended by experts. Barcelona has the highest rental burden (46%), followed by Palma (45%), Malaga (42%), Valencia (41%), Madrid (38%), Alicante (37%), San Sebastian (33%), Las Palmas de Gran Canaria (32%), Santa Cruz de Tenerife (32%), Bilbao (31%) and Segovia (31%). Below these figures are Seville (29%), Vitoria (27%), Cadiz (26%), Pamplona (26%), Granada (26%) and Santander (26%). In contrast, Ciudad Real (16%), Teruel (18%), Jaen (18%), Caceres, Palencia and Cuenca (19% in all three cities) have the lowest burden.

In Segovia, the rent burden has risen the most, with an increase of six points. This is followed by Malaga (five points), Valencia (five points), Madrid and Barcelona (four points each). In five provincial capitals, the rent burden is lower than a year ago: Cuenca (minus two points), Tarragona, Cordoba, Jaén and Badajoz (all minus one point).

The province of Malaga has the highest rental burden for residents, representing 54% of family income. This is followed by the Balearic Islands (53%), Barcelona (43%), Valencia (40%), Santa Cruz de Tenerife (38%), Las Palmas, Alicante and Madrid (37% in all three provinces). Also above 30% are Guipuzcoa (34%), Seville (30%) and Cadiz (30%). Teruel (16%), Palencia, Jaén and Ciudad Real (19% in the three provinces) are the four provinces where the lowest expenditure is required.

In most cases, the mortgage burden is lower than the rental burden, with the exception of the markets of San Sebastian, Cadiz, Granada and A Coruña. In addition, the purchase burden is above the 30% recommended by the experts in five provincial capitals: Palma (44%), San Sebastian (39%), Malaga (38%), Madrid (34%) and Barcelona (31%). This is followed by the cities of Alicante (29%), Cadiz (29%), Granada (27%), Valencia, Las Palmas de Gran Canaria and Pamplona (26% in all three cases). The lowest burden is in Jaén (11%), Lleida (11%), Ciudad Real, Palencia, Teruel, Huelva, Zamora and Murcia (13% in all six cities).

Six provincial capitals have a lower mortgage burden than a year ago. The largest differences were recorded in Barcelona and Albacete (minus two points each), followed by Huelva, Cuenca, Palma and Badajoz (minus one point each). On the other side of the table, the increases are in the efforts of Malaga (eight points), Madrid (six points), Cadiz (six points), Santa Cruz de Tenerife (six points) and Alicante (five points).

Among the provinces, the Balearic Islands have the highest burden – 44% of family income. This is followed by Malaga (42%), Santa Cruz de Tenerife (36%), Alicante (30%), Madrid (26%) and Las Palmas (26%). In the province of Barcelona it is 20%. The provinces of Lleida, Teruel, Toledo and Ciudad Real have the lowest mortgage burden with a rate of 11%.

Housing cost burden measures how much housing weighs on a household’s purchasing power. More specifically, in the case of rent, at idealista/data we measure burden as the annual proportion of average net household income spent on renting a typical two-bedroom home. Rental values ​​come directly from idealista’s data source, which includes prices for each city. Net household income data, on the other hand, comes from the National Statistics Institute (INE).

The situation is similar for purchases: the charge is calculated as the annual share of the household’s net income used to repay a “typical” mortgage, that is, it is agreed with average characteristics in terms of duration and interest rate. Due to recent interest rate increases, the calculation has been updated based on data published by the European Central Bank.