Spain trapped in rental crisis: up to half of wages now go on housing
A property-portal study shows that in Spain the share of wages spent on rent has risen 12 percentage points since 2019. Madrid and Catalonia top the regional ranking, with rents now eating roughly 70% of the average pay packet.
Housing costs in Spain are squeezing households harder month after month. According to the property-portal study, the average tenant now spends 47% of their monthly pay on rent, up from 35% in 2019. In Madrid and Catalonia the ratio reaches as high as 70%, well above the 30% threshold that the European Union recommends as sustainable housing expenditure.
The Ministry of Housing reports that the supply of rental flats in large cities has shrunk by 22% over two years. The Spanish Confederation of Builders says the shift to short-term tourist rentals has deepened the squeeze. The government plans to bring before parliament in the coming weeks a decree extending the temporary rent-cap law.
Economists say the erosion of purchasing power is starting to weigh on consumption data. The banking supervisor noted that new mortgage applications have fallen 18% so far this year. The European Commission has said it will give Spain extra flexibility in spending structural funds to support housing investment.
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