Annual pay differs by about €10,000 between Spanish regions, but a 90-square-metre home can cost up to €383,000 more. In the Balearic Islands and Madrid, buyers need more than €129,000 saved for the deposit and other upfront costs.
In Spain, earning a good salary does not necessarily make it easy to buy a home. An analysis by iAhorro reveals wide disparities between regions: while salaries vary by around €10,000 a year across Spain, the price of a 90-square-metre home can differ by almost €383,000.
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The biggest hurdle is the money that has to be saved before applying for a mortgage. To buy a 90-square-metre home, the buyer has to put down around 30% of the price to cover the deposit and other costs. In the Balearic Islands, that comes to about €144,000, compared with €29,000 in Extremadura and €30,000 in Castile-La Mancha.
Prices account for much of this gap. A 90-square-metre property costs around €480,000 in the Balearic Islands and €431,000 in Madrid. By contrast, it costs about €97,000 in Extremadura and around €100,000 in Castile-La Mancha. So a higher salary does not always offset the cost of housing.
Savings also make the difference. If a family sets aside 35% of its income to save for the deposit, it could gather the money needed in less than five years in nine regions: Galicia, Navarra, Aragón, La Rioja, Murcia, Asturias, Castile and León, Extremadura and Castile-La Mancha.
At the other end of the scale are the Balearic Islands, Madrid and the Canary Islands. In these territories, five years of saving would not be enough to raise the money needed for a 90-square-metre home. For someone buying alone, the effort is even greater: they would need to save for 14.2 years in the Balearic Islands, 10.7 years in Madrid and 10.1 years in the Canary Islands.
According to iAhorro’s head of communications, Laura Martínez, quoted in a statement, the main problem is not so much paying the mortgage as pulling together the money to get started: “The hardest part is managing to save.”
According to the analysis, young people and buyers living alone find it hardest to overcome this first barrier.
