The Cost of Residential Independence in the Basque Country 2021
Study available in Basque and Spanish
This new report in the series looks at how much it costs, theoretically, for a young wage earner aged 18-34 to become independent, either by buying or renting a home.
To this end, we calculate twelve indicators that reflect the theoretical cost of buying or renting non-subsidised and subsidised housing. This is a theoretical cost because it is based on the average prices of homes for sale or rent, the average wages of young people, and the standard conditions of mortgage loans; therefore, ignoring individual cases.
The data, and their evolution, have been presented for the Basque Country as a whole and for each of its provinces. They are also broken down by sex and age group.
The results of the report show that the cost of buying non-subsidised housing, i.e. the percentage of the net monthly salary that a wage earner aged 18 to 34 would have to spend on the first monthly mortgage payment to buy a house on the open market would be 52.9% in 2021. This value is four percentage points lower than in the previous year.
The cost of renting non-subsidised housing, i.e. the percentage of the net monthly salary that a young wage earner would have to spend on rent would be 51.1% in 2021, slightly below the 2020 value (52.7%).
These figures exceed the recommended maximum debt limit, which is usually set at 30% of a person’s salary.
Subsidised housing, on the other hand, is much more affordable for young wage earners. In 2021, buying subsidised housing on their own implied spending 28.8% of the net monthly salary on the mortgage payment, while renting a subsidised flat was more affordable as only 28.1% of the net salary would have to be dedicated to the monthly rental payment. These options allow young people to become independent without the risk of incurring excessive debt.
