Buying a new flat now costs nine years salary

24th November 2006, Comments 0 comments

24 November 2006, MADRID — The price of a flat in Spain is equivalent to nine times the average salary, a report said.

24 November 2006

MADRID — The price of a flat in Spain is equivalent to nine times the average salary, a report said.

The Savings Banks Foundation (Funcas) report, published on Friday, also said an average family, with one wage earner, has to use 45 percent of its savings and earnings power to be able to afford a flat of 90 square metres (psm).

The report's authors said the rise in the price of homes in recent years meant people now paid nine years salary to buy an average apartment.

Between 1995 and 2005, the value of the average home had tripled, from EUR 570 psm to EUR 1,841.

Only in the past five years, have house prices started to rocket, the report said, with homes going up 17 percent each year.

It appeared house prices were not starting to come down because demand remained strong.

Two million more homes are expected to be built this year alone.

In Spain, there are 510 homes for every 1,000 inhabitants, compared with European Union average of 468.

By 2011, the report said, there should be 17 million new homes.

A survey also revealed 37 percent of Spaniards believed buying or selling a home was the only way to make money.

[Copyright EFE with Expatica]

Subject: Spanish news 

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