In 2022, EU households spent the majority of their budget on housing, food and transport. In Spain, this spending was generally lower than in other European countries. In fact, Spanish households spent 22.3% of their budget on housing, less than in the UK, France and Germany. However, the increase was considerable. Between 2002 and 2022, the most notable increase was in the housing sector, which rose from 21.1% to 24.1%. This implies an increase of 3 percentage points over this period. For example, if in 2002 a household with a total expenditure of €1,000 had allocated €211 to housing, in 2022 this figure would have increased to €241.
If we look at young Spaniards, what they spend on housing is increasing exponentially. The rent for a standard apartment is 968 euros per month, 88 euros more than a year ago (10% more), which represents 92% of the salary allocated to rent. Rent prices have increased 2.5 times more than young people’s salaries; the cost of supplies has increased by 17.3%, reaching 163.61 euros per month, according to the Spanish Youth Council.
In the early 2000s, spending on housing and utilities was just over 20%and lived a constant growth until reaching a peak of almost 25% in 2013. This period reflected the largest increase in costs associated with housing and utilities. Subsequently, after a slight decline, this percentage increased again during the health pandemic, reaching a historic record of 25.6% in 2020.
Over the past ten years, house prices have increased by 34%, exceeding the growth of the average salary by 10 points, according to data from Apartments.com. This increase has made access to housing difficult, especially for people with lower incomes. The study highlights the loss of purchasing power and the difficulty of acquiring housing as central problems in the current real estate market.
In 2022, Slovakia tops the list with more than 30% of household expenditure going to housing.. Finland and Denmark followed closely with percentages of 29.6% and 29.1%, respectively. Northern and central European countries face significant financial pressures in housing and public services, likely due to high energy costs and more expensive real estate markets.
On the other hand, Southern and Eastern European countries, such as Montenegro, Turkey and Albania, have much lower percentages. Montenegro only reaches 11.6%, while Turkey and Albania have 12.4% and 12.5% respectively.
In food, below the European average
In food, Spain also spent less, with 13% of the budget, below the EU average. and significantly less than in the UK.
Transport and healthcare costs in Spain were also lower than in other countries, reinforcing Spain’s image as an affordable destination for expats compared to the UK, France, Germany and Italy.
According to Eurostat, Spain continues to offer a more affordable lifestyle despite rising costs in Europe.especially compared to the UK and other popular destinations.
In terms of percentage change, health spending increased by 22%, while housing spending increased by 14%.
Ireland spends more on housing
Ireland recorded the largest increase in housing expenditure, with a notable increase of 7.1% between 2002 and 2022. Spain and Italy also saw significant increases, of 6.3% and 5.4% respectively. In total, 10 European Union countries saw increases of more than 4%, indicating a general upward trend in the region.
On the other hand, some Eastern European countries, as well as Sweden and the UK saw a decline in the share of spending spent on housing. Romania stands out for the biggest drop, with a reduction of 4.1%, while Bosnia and Herzegovina and Serbia also recorded significant declines.
Eating and sleeping outside
Spain is one of the EU-27 countries, along with other regions of the Mediterranean arc and Ireland, which dedicates a larger budget to eating out and sleeping away from home. On the other hand, Romania, Poland and the Baltic countries spend the least on restaurants and hotels. This is reflected in the weight, for each country, of the category of hotels and restaurants in the Harmonised Index of Consumer Prices (HICP) according to Eurostat data.
The countries with the highest weight of hotels and restaurants in the price indices are those that allocate a larger budget to this category, i.e. those that spend the most on eating and sleeping away from home. Ireland is followed by Greece (19.2%), Cyprus (19.3%), Portugal (17.3%), Austria (16.6%), Malta (15.8%), Spain (15.1%) and Italy (12.4%). Spending on hotels and restaurants tends to follow the economic cycle: it increases in times of expansion and decreases in times of crisis. This was evident during the pandemic, when spending on food increased while spending on eating out decreased.
Lower prices
In Spain, housing prices are 23.4% lower than the European Union average. Compared to 2022, residential property prices increased by 2.5 percentage points, reaching 76.6% of the EU average according to the Eurostat price index. Since the start of the historical series in 2003, prices have fluctuated, reaching a maximum of 93.2% in 2005 and a minimum of 67.1% in 2016, with a recent average of 75.2%. Switzerland has the highest property prices in Europe, 54.1% above the average, followed by Germany, Sweden, the Netherlands and Luxembourg.
Bosnia and Herzegovina, on the other hand, has the lowest property prices, 66.6% below the average. Other countries with low prices include North Macedonia (-63.7%), Croatia (-63.6%), Turkey (-58.7%) and Romania (-56.8%). Portugal, with property prices 63.9% below the average, and Italy, with 77.1%, have prices similar to those in Spain. In contrast, France has prices above the European Union average, 3.2% higher.
In addition, In Spain, the price of non-residential buildings is 81.5% lower than the European Union averagewhich is an increase of seven percentage points from 76.1% in 2022. Sweden has the highest prices, 55.7% above average, followed by Germany (51.4%), Switzerland (50.2%) and Finland (26.8%). Croatia has the lowest prices, at 48% of average, followed by Bosnia and Herzegovina (53.9%), Albania (55.5%), Romania (60.1%) and Montenegro (60.8%).
