Soaring Rental Prices

After getting over the building bubble, we seem to have moved onto the house-rent bubble, with rents increasing up to 12 times more than salaries.

The worst-hit cities are Barcelona and Madrid and the reason for this steep rise is holiday lets: more and more flats are being let out to tourists at elevated tourist prices and normal city residents simply can’t afford those prices, namely young people trying to become independent from their parents.

This situation has not affected the Costa Tropical, although July and August have always been prohibitive from a resident’s point of view but the rest of the year, and year-round rental contracts are still relatively cheap compared to large cities further north and the prices paid abroad in other parts of Europe.

In other words, young people don’t have problems entering the rental market.

The other side of the coin is that young people, now faced with these skyrocketing rental prices are opting for home ownership again through mortgage payments, despite the misery of the eviction years during the crisis.

(News: Spain)

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