Property purchasing is booming in major cities, while renting is picking up in rural areas

Property purchasing is booming in major cities, while renting is picking up in rural areas

In Spain the average housing price increased by 3.7% in 2021 compared to 2020 according to the National Statistics Institute (INE). On the contrary, the average renting price for a house paid by the Spanish decreased by 3.6-4.5%, according to information from the real estate portals Fotocasa and Idealista. In spite of everything, "consumers move with "moderate speed" from renting to purchasing," - says Antonio Gallardo, the financial expert in iAhorro.

A survey conducted by iAhorro, the mortgage comparator, is based on average information provided by INE (24 years to repay a mortgage with a 2.53% interest rate). It explains that the efforts made by Spaniards to buy a housing are 26.37% in comparison with 38. 71% of efforts spent on rent. The difference in 12.34 points makes renting less profitable than buying a home for Spanish people.

This difference becomes even more obvious when we take into consideration average mortgage payments and rental payments. On the one hand, buying a home is more profitable than renting in autonomous communities with the most populated areas of the country, such as Catalonia and the Community of Madrid.

Up to 400 euros in savings a month

For Catalans, the average payment for real estate purchase and sale will be 764.11 euros a month, and they will pay 1,169 euros a month for a rented apartment. However, "there is a big difference between Barcelona and other provinces," says Gallardo. With a small difference residents of Madrid will pay 980.37 euros a month for a mortgage, compared to 1,246 euros a month for renting an apartment.

In the case of the Basque Country, there are also significant monthly savings between buying a home and renting it. Citizens will pay 753.07 euros a month in the first case, and 1,092 euros in the second case on average. And the monthly payment for real estate purchasing will be 517.74 euros, and for rent - more than 820 euros in the Canary Islands.

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