The ongoing struggle for affordable housing in Spain continues to worsen, whether in terms of purchasing or renting. A recent study by idealista.com revealed that, on average, households now need to allocate 22% of their income for buying a property and 33% for renting in 2023. The latter figure highlights the insufficient supply of rental properties, leading to a surge in prices. Renting has become 3% more burdensome over the past year. Meanwhile, rising mortgage costs due to increased interest rates have pushed the share of income spent on homeownership from 18% to 22% in just one year.
Regional disparities are stark, with Barcelona demanding the highest percentage of household income for average rent (44%), followed by Palma de Mallorca (43%), Valencia (39%), Málaga (38%), and Madrid (37%)—all significantly above the recommended 30% threshold advised by experts. The effort required for homeownership tends to be slightly lower than for renting, but in cities like Palma de Mallorca (46%), San Sebastián (39%), Barcelona (33%), Málaga (33%), and Madrid (31%), it exceeds the recommended 30%.
These figures contrast with the perception of 2023 as a prosperous year for the real estate market, driven by increased property values. While investors naturally seek security and profitability, it’s crucial to ensure adequate accessibility, prioritizing housing for permanent residency, especially in such a dire situation. Currently, according to Funcas estimates, 6 out of 10 property transactions are completed without a mortgage, highlighting the disparity in access options.
The Housing Law enacted a year ago introduced complex measures, particularly focused on rental markets, which have proven challenging to implement successfully. Rent price caps often have unintended consequences, such as reducing the availability of rental properties and exacerbating the crisis. The lack of supply remains the primary concern. During the 2023 electoral campaigns, accessibility, especially for young people, was a prominent topic. However, addressing this issue will require significant time due to the number of homes needed, highlighting the need for decisive action. Increasing housing supply, both public and private, starting immediately and continuing throughout the decade, is essential. Accessibility to housing must cease to be a medium-term nightmare. In the short term, the only relief may come for homeowners with variable interest rate mortgages, who may gradually see a decrease in their loan’s financial burden throughout 2024. While this is a positive development for them, much more comprehensive solutions are needed.