The shortage of affordable housing condemns almost half of young people to live with their parents

2023-09-25 00:03:02

Almost half of young people between 25 and 34 years old still live with their parents. The problem is not the lack of work or that they are studying because two out of every three young people in that age group who live with their parents have a job and the majority work full time. The great barrier to emancipation in Spain is being able to find affordable housing. The age of emancipation exceeds 30 years in Spain compared to the average of 26.4 years in the European Union. And while this age of emancipation is stabilizing in the EU, in Spain it does not stop growing. Currently, 46% of young people between 25 and 34 years old live with their parents, ten percentage points more than a decade ago, according to Raymond Torres in an article in Funcas.

The lack of availability of an abundant rental park at affordable prices is one of the main shortcomings in our country, according to Eurostat. The delay in emancipation is, in turn, one of the causes of the low birth rate in Spain, one of the main problems to sustain the pension system in the future, among others.

Since the real estate bubble burst, housing construction has grown at a slower rate than demand. Since 2015, an average of 75,000 homes have been started per year compared to almost 120,000 new homes formed annually. And the offer is concentrated in home ownership, something that is not available to the majority of young people today. At the beginning of the century, there was much more supply, which put downward pressure on prices, and mortgage credit was more abundant; Consequently, almost six out of every ten young people lived in a home they owned, compared to four out of ten who rented. Now, only 30% live on property.

How to solve it? The path must necessarily involve increasing the supply of rental housing, which would push prices down. Four out of ten tenants dedicate more than 40% of their disposable income to paying rent, which is double what they have to allocate on average in Europe. Raymond Torres explains that direct aid for paying rent can be useful from a redistributive point of view, but it is not particularly relevant to promoting emancipation; it would only help solve the problem if the supply of rentals is increased.

And to achieve this, there are different paths that are being applied in various countries: limiting tourist rentals, taxing empty homes, soft loans to build social rental homes or land concessions for private construction, reserving a proportion for rental housing.