Housing Prices Soar in Spain Amid Social Spending Shortfalls
Spain faces soaring housing prices and social spending shortfalls, intensifying housing accessibility challenges and social vulnerability.
- • Spain's housing prices rose 12.8% in Q2 2024, the third highest in the Eurozone.
- • Spain's social spending on elderly care, disability, and housing is below European averages.
- • Housing price surges challenge affordable access for vulnerable groups.
- • CES report highlights critical social issues like child poverty and early school dropout rates.
Key details
Spain is witnessing a dramatic surge in housing prices, increasing by 12.8% in the second quarter of 2024 compared to the same period in 2023, according to Eurostat data. This represents the third highest growth rate in the Eurozone, surpassed only by Portugal's 17.2% and Croatia's 13.2%, and is well above the Eurozone average increase of 5.1%. Over the past three consecutive quarters, Spain's housing prices have consistently risen by more than 10%, highlighting a pressing challenge for housing accessibility, especially among vulnerable populations.
This sharp rise contrasts starkly with other European nations like France, Sweden, and Cyprus, which experienced minimal increases, and Finland, the only country reporting a housing price decline of 1.3%. The accelerated price growth in Spain exacerbates difficulties for those seeking affordable housing.
Compounding this issue is Spain's underwhelming social spending compared to European averages, particularly in critical areas such as elderly care, unemployment support, disability assistance, and housing. A report from the Economic and Social Council (CES) of Spain, drawing from Eurostat and European Commission data, reveals that despite some improvements, Spain's social protection expenditures remain below the European average. For example, Spain spent 2,562 euros per capita on elderly care in contrast to the European average of 3,388 euros and only 375 euros per capita on child and family support, which is significantly less than the EU average of 715 euros.
The CES report points out that Spain's spending on housing is alarmingly low, investing less than a third of the EU's per capita expenditure in this area. The report further categorizes Spain's social challenges as 'critical,' citing high early school dropout rates and significant risks of poverty and social exclusion, particularly affecting children.
The labor union USO acknowledges some government efforts to address poverty but stresses the urgent need for increased social budgets aimed at childhood welfare, better access to assistance programs, and more robust policies targeting housing affordability. They argue these reforms are essential to alleviate the growing social strains resulting from soaring housing costs and insufficient social protection.