Does being an emancipated young person increase the risk of poverty? A study puts numbers on it

BarcelonaYoung people and migrants are particularly suffering from the housing crisis in Catalonia, as in many other European regions. These two groups are an important part of the low-income population, who are the ones who suffer the most from this problem.

Discrepancies in the Spanish housing market, Desajustes en el mercado de la vivienda en España, published this Friday.

In contrast, among the general population, the risk of poverty rises from affecting 19.5% to 23% of citizens. Although the increase is smaller, the research emphasizes that the housing crisis is spreading and "has an ever-increasing impact on middle-income households.""has an ever-increasing impact on middle-income households".

Allocate more than 40% to housing

The weight of housing and utilities in a family's total expenses has "significant differences" depending on whether they own the home they live in.

On average, families spend 19% of their disposable income on housing. However, if we study it in detail, we see that housing consumes 34.2% of the income of renting families, 24.2% of those with a mortgage, and 9.9% of the income of owners without a mortgage.

This disparity is not explained solely by the absolute cost of housing, but also by the wealth of the groups that can access each type of tenure.

In other words, it is not that rent is more expensive than a mortgage, but rather that those who rent – in general – have lower incomes and, therefore, have to dedicate a more significant portion of their resources to it. One in every four of the poorest people in society lives by renting (24.7%), while only one in ten of the richest opt for this option (10% of this income segment).

Along these lines, the housing expense overload also soars among young people and migrants. While almost one in ten Spanish households (9% of the total) dedicate more than 40% of their income to paying for where they live, the proportion increases to 2 in 10 among young people (19.6%). In the case of foreigners, it is 1 in 4 households (25.8%).

Regarding migrants, the report emphasizes that the difficulties are not generalizable. "There is a significant group with high incomes who buy housing in coastal, tourist, or large cities," it warns in reference to expats. They spend "an average of 60% more than Spaniards".

Alleviating the "rent risk"

The BBVA Foundation and Ivie note that "housing access problems are concentrated in the market-rate rental market". Faced with this situation, they call, on the one hand, for reducing rental risk to encourage supply, that is, by applying "agreed rents" in which administrations assume the payment of the installment if the tenant fails to pay it.

On the other hand, they also advocate for expanding the supply of rental housing. Regarding the free market, they call for building more, using industrialized methods and streamlining procedures. Regarding the public housing stock, they are in favor of buying and managing the supply held by private entities, using the pre-emption and redemption formula, and incorporating the apartments and houses owned by the Social Housing Fund and Sareb.