If Spain's President has his way, citizens in the 18-35 age group with get $289 every month so they can rent their own places. Spain’s youth unemployment levels have shot up to 38 percent, the highest in Europe, in the wake of the COVID-19 pandemic.
Spain will soon begin to pay youngsters nearly $300 to gently nudge them out of their parents' homes. Pedro Sanchez, Spain’s President, announced the proposal to give $289 to young Spaniards to incentivise them to rent their own houses. The incentive is part of Spain’s 2022 budget proposal and will need to be approved by the parliament before it can start.
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Spaniards in the 18-35 age group, and earning less than 23,725 euros a year, will be eligible for the plan. Some of the most vulnerable families will receive additional subsidies that will cover up to 40 percent of their rent commitments.
While Spanish homeownership levels were higher than the European average, with 76.2 percent compared to Europe’s 69.8 percent, the high level of youth unemployment has led to a shrinking rental market. Spain’s youth unemployment level is the highest in the region, with 38 percent of the demographic not having any jobs.
Though Spain has a tradition of children living with parents till they are 30 -- four years more than the European average -- the conflux of high homeownership and low incomes have caused rental prices to spike further, delaying the timeline of youth moving out.
The average cost of rent in the capital city of Madrid for a one-bedroom apartment stood at somewhere between 900-1,000 euros. Other prices have crept up as well while the average salary of a Madrid resident still hovered around 1,600 euros for those lucky enough to still have a job.
Spain was one of the worst-hit countries at the start of the COVID-19 pandemic, and the restrictions had an immense economic impact on the country.
Spain is not the only nation where children have either not moved out or even moved back in with their parents as a result of losing disposable income as a result of the COVID-19 pandemic.
In the US, where many often move out when they are as young as 18 and starting college, a record number moved back to their childhood homes. A Pew Research Center analysis found that in June 2020, more youth lived in their childhood homes than independently for the first time since the Great Depression in the 1920s.
(Edited by : Shoma Bhattacharjee)
First Published: Oct 11, 2021 7:41 PM IST