House prices rise 14 times more than salaries

15th July 2005, Comments 0 comments

15 July 2005, MADRID — House prices in Spain have risen fourteen times more than salaries in the last 17 years, a report said.

15 July 2005

MADRID — House prices in Spain have risen fourteen times more than salaries in the last 17 years, a report said.

The report from the Workers Commission (CCOO) union said this showed a "worrying tendency" in the ratio of house prices to salaries between 1987 and last year.

House prices have risen 130 percent during this time, while salaries have only doubled, by just 9.6 percent.

In 1987, to buy an average house of 90sqm would require 3.5 times the average salary.

But by 2004, it was necessary to have 8.2 times the average salary to buy the same property.

The report said house prices are experiencing the second 'cycle' in the last twenty years.

The first period was between 1986-91, after Spain joined the European Union.

The second was with the entry of the euro and the start of rapid economic growth between 1999-2004.

The present phase of growth has lead to a 107 percent rise in the price of a square metre of property in just six years.

This is six times higher than the increase in salaries at the same time.

But house prices have varied, with housing in bigger cities increasing faster compared to smaller towns.

Madrid has the most expensive property, which costs 80 percent more than the national average. Barcelona and Bilbao come second.

The price per square metre in Madrid is on average EUR 3,000, while in Barcelona it is EUR 2,800 and in Bilbao it stands at EUR 2,500.

[Copyright EFE with Expatica]

Subject: Spanish news

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