The housing market is worth 1,000 times more than in 1970: Who's holding the price?
The housing market is worth 1,000 times more than in 1970: Who's holding the price?
English · Original discussion in Spanish · Published
The housing market is worth 1,000 times more than in 1970: Who's holding the price?
In 1970, a worker without studies could buy an apartment in the provincial capital with his salary for a year. In 2026, that same old apartment demands two salaries above the average for 60 years. The difference is not an improvement: it's a 900% overcharge that nobody dares to name.
The 90% paradox
The uncomfortable question is why the housing market price shouldn't be 90% lower. The comparison is simple. Half a century ago, a house cost 100,000 pesetas. Today, the same property is sold for 100 million pesetas. That's an increase of a thousand times. If salaries had trinc that curve, a medium salary would have allowed you to buy an apartment every year. Not the case.
The causes: from the Boyer decree to SAREB
The explanations point in several directions. A current blames the Boyer decree of 1986, which liberalized land and sparked speculation. Another points to the bank rescue in 2008: more than 100,000 million euros injected into the banking system, with SAREB as a management tool for toxic assets. There's also tax pressure: ITP from 6% to 20% when buying, IRPF from 19% to 23% when selling, plus municipal capital gains tax. The state collects taxes in proportion to the price, so it has no incentive for prices to drop.
Who wins with the high price
70% of Spanish households are homeowners. If you add heirs, the percentage rises. That means most people don't want prices to drop, even if they don't say so out loud. The price increase has more beneficiaries than losers, and many of the losers are foreigners. Housing has become an asset, not a right.
The effect on natalism and immigration
It's argued that high housing prices force the system to import labor, because it burdens native-born populations. But immigrants also suffer from high prices: they live in shared rooms and have few children. Birth rates are plummeting. As long as housing prices aren't reasonable, labor mobility and demographics will continue to deteriorate.
The future: 2029-2030
Some point to the fact that prices will drop in 2029-2030, when energy regulations force renovations or demolitions. Not a single second-hand house meets current standards today. This could force devaluation, but also a new bubble of renovations.
In 1970, a worker without studies could buy an apartment in the provincial capital with his salary for a year. In 2026, that same old apartment demands two salaries above the average for 60 years. The difference is not an improvement: it's a 900% overcharge that nobody dares to name.
The 90% paradox
The uncomfortable question is why the housing market price shouldn't be 90% lower. The comparison is simple. Half a century ago, a house cost 100,000 pesetas. Today, the same property is sold for 100 million pesetas. That's an increase of a thousand times. If salaries had trinc that curve, a medium salary would have allowed you to buy an apartment every year. Not the case.
The causes: from the Boyer decree to SAREB
The explanations point in several directions. A current blames the Boyer decree of 1986, which liberalized land and sparked speculation. Another points to the bank rescue in 2008: more than 100,000 million euros injected into the banking system, with SAREB as a management tool for toxic assets. There's also tax pressure: ITP from 6% to 20% when buying, IRPF from 19% to 23% when selling, plus municipal capital gains tax. The state collects taxes in proportion to the price, so it has no incentive for prices to drop.
Who wins with the high price
70% of Spanish households are homeowners. If you add heirs, the percentage rises. That means most people don't want prices to drop, even if they don't say so out loud. The price increase has more beneficiaries than losers, and many of the losers are foreigners. Housing has become an asset, not a right.
The effect on natalism and immigration
It's argued that high housing prices force the system to import labor, because it burdens native-born populations. But immigrants also suffer from high prices: they live in shared rooms and have few children. Birth rates are plummeting. As long as housing prices aren't reasonable, labor mobility and demographics will continue to deteriorate.
The future: 2029-2030
Some point to the fact that prices will drop in 2029-2030, when energy regulations force renovations or demolitions. Not a single second-hand house meets current standards today. This could force devaluation, but also a new bubble of renovations.
Summary of a discussion on Burbuja.info - Foro de economía, actualidad y política., translated from Spanish and reviewed before publication. Read the full discussion (207 replies).
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