Access to housing is increasingly expensive for first-time buyers, adn not just as of the prices themselves. You own a house involves something else many invoicessuch as maintenance, supply invoices or different types of taxes. Something similar happens to what is frequently enough said about cars, that is, “you spend more on food than on anything else”, that is, for daily use.
this year we knew it, through data shared by the Real Estate Credit Union (UCI). 24.5% of Spaniards declare that they have no ability to save at the end of the month. Much more worrying, though, is the situation of the young population in our country, as emerges from the study “X-rays of homes in the first half of 2024” by the real estate portal Fotocasa, which highlighted lack of savings and job insecurity as the main obstacles for those considering purchasing a house over the next five years.
And according to a survey by the National Institute of Statistics (INE),last year The percentage of young homeowners aged 16 to 29 was 29%.the lowest level compared to pre-pandemic data.Rising prices of both real estate and rent, together with inefficient (or even counterproductive) policies, are leaving a uncertain and somewhat pessimistic horizon for future owners.
The price of houses in Spain is rising and renting or buying houses and apartments is increasingly “inaccessible”, in a strong crisis in the real estate marketDream time
But even for that ever-decreasing majority who manage to save at the end of the month, purchasing a new property becomes complex. In addition to inflation slowly eroding savings, Both the purchase and ownership of a property involve large financial outlays.especially in the form of taxes.
I’m a lawyer and I’ll explain what savings you need to buy a house and what taxes you will pay
It is indeed thus advisable to know in advance what the ‘extra’ expenses are related to the purchase and ownership of a new home. be proactive and ensure you have enough money to cover additional fees. as we learned earlier this year, housing rent represents 80% of a young person’s salary, and for To buy a house they need, on average, savings equal to about 3.7 times their annual salary.
ARE YOU INTERESTED:Home, a dead end for young people: rent eats up 80% of their salary and to buy they need savings equal to 3.7 times their annual salary
Despite this, there are young people in Spain who manage to keep their savings quickly, and there are quite a few who think about it Buying a house as one of the most important projects for the future. This is a very important decision and you need to know the details and additional outlays that your purchase may involve. For this purpose, Miguel Benito Barrionuevo (@trabajo_informado), an “influencer” lawyer and content creator on employment law, recently shared a video.
This lawyer shared a quick calculation of the money a person would have to save to buy a house of around 200,000 euros, a fairly conventional price at the moment, although it varies a lot depending on the area and city in which it is located.
- Entrances alone represent 20% of the total, i.e €40,000.
- Depending on the type of home and the Autonomous Community, you will have to pay between 6% and 11.5%. Taking 10% such as, it would be another €20,000.
- the costs of management, notary, survey and registration of the property can easily amount to approx €2,300to which we should add the VAT (Value Added Tax) of all except the registry office. namely,another €440.
- Miguel Benito also warns of the great difficulty it is nowadays to buy a house without the intermediation of an agency, which usually asks for between 3% and 5% commission. Applying 3% would mean another expense of €7,200,over €1,200 VAT.
- In the event that you need to renovate the house and furnish it, this outlay can perfectly mean, around €30,000with their correspondents €6,300 VAT added.
In total, Initial expenses could easily reach 70,000 eurosalmost double the entrance fee. If it also needs to be renovated and furnished, easily The sum amounts to 105,000 euros. Of all this outlay, 28 thousand euros would correspond only to taxes. This attorney always recommends staying informed to avoid possible “scares” in the future.
What are teh key challenges facing first-time homebuyers in Spain today?
Interview between Time.news Editor and real Estate Expert
Editor: Welcome to Time.news! Today, we’re diving deep into the current housing crisis facing first-time buyers in Spain. Joining us is Dr. Elena Martínez, a renowned expert in real estate economics. Thank you for being here, Dr. Martínez.
Dr. martínez: thank you for having me! I’m excited to discuss such an vital topic.
Editor: Let’s start with the basics. What do you believe are the primary factors contributing to the high costs of housing for first-time buyers in Spain?
Dr. Martínez: The main factors are undoubtedly the rising property prices and the associated costs of homeownership, including maintenance, utilities, and taxes. Many people focus solely on the purchase price, but those ongoing expenses can be significant.
Editor: That’s a critical point.You mentioned ongoing expenses. Many first-time buyers might not fully grasp that purchasing a home is only part of the financial equation.
Dr. Martínez: Exactly. It’s similar to the common phrase about cars, where daily usage costs can sometimes exceed the purchase price. Many potential buyers, especially younger individuals, are not prepared for this reality.
Editor: Recent statistics show that 24.5% of Spaniards report having no ability to save at the end of the month.This must have a significant impact on first-time buyers.
Dr. Martínez: It absolutely does. This lack of savings, combined with job insecurity, is notably devastating for young people looking to enter the housing market. According to the “X-rays of homes in the first half of 2024″ study by Fotocasa,these are the biggest obstacles they face when contemplating homeownership.
Editor: The data reveals that only 29% of young people aged 16 to 29 are homeowners, the lowest number since before the pandemic.What do you think is driving this trend?
Dr. Martínez: The combination of skyrocketing prices in both purchasing and renting properties is a significant factor. Moreover, many policies aimed at improving accessibility have proven inefficient or even counterproductive. This creates a pessimistic outlook for young potential homeowners.
editor: with such a dire landscape, what solutions could be implemented to support first-time buyers?
Dr. Martínez: One potential solution is the introduction of more favorable lending conditions, such as lower interest rates for young buyers or the possibility of longer repayment terms. Additionally, government incentives could help, like grants for first-time buyers or tax reductions.
Editor: Those sound like promising ideas. As we look to the future, do you believe the housing market will stabilize?
Dr. Martínez: It’s hard to predict, but if we see changes in policy and an increase in affordable housing options, there is a chance for some stabilization. Tho, without significant intervention, the current trend of rising prices could continue, making it increasingly difficult for young people to buy homes.
Editor: Thank you, Dr. Martínez, for shedding light on this pressing issue. it’s crucial for our readers to understand the challenges in the housing market and what can be done to help first-time buyers.
Dr.Martínez: Thank you for having me! I hope this discussion encourages further dialog and action on this critically important topic.
Editor: Absolutely! Until next time, stay informed.