The Cost of Living in Spain

Back in 2004 the British financial services company Prudential ran a survey to find out which of the most popular overseas retirement hotspots had the lowest cost of living and the poll was topped by South Africa with Spain coming in at number three as an affordable overseas destination for retirees.

Since 2004 Spain has suffered some inflation – particularly in the property market – but generally speaking the cost of living in Spain remains affordable whether you’re considering retiring or living and working in Spain.

As stated however the property market in Spain cannot be considered as being cheap or even low cost.  The most popular southern coastal regions of this Mediterranean country have some of the highest property prices in Europe in fact.  But for those on a budget and determined to live in Spain then areas such as Northern Spain or the lesser explored coastal regions of Costa Almeria or Costa de la Luz provide an affordable alternative.

Utilities costs in Spain remain competitive compared to the European average and this is despite rising fuel costs. For two people with fairly low to average consumption electricity costs should be around EUR 35 a month for example.  The government in Spain are committing to an energy reform and Código Técnico de la Edificación or new building regulations have been passed to make all new property in Spain more energy efficient and cheaper to run.  This is good news for those who buy in the future but it also serves as a lesson for those who already own Spanish property.  To reduce energy costs the power of the sun can be better utilised to heat water and insulation materials can be used to keep properties cooler in the summer and warmer in the winter thus reducing energy bills substantially.

For families it’s good to know that the Spanish government subsidises all state schools and that basic health care in Spain is free for those who come from another EU member state or who become tax paying residents in Spain.  Preschool care can be expensive depending on whether a child is entered into a state nursery or cared for by a child minder for example, but expect to pay around EUR 100 a month for a nursery place.

In terms of the day to day cost of living in Spain food can be cheaply bought from local markets which are held at least weekly in the larger towns across the country.  For those hoping to keep living costs to a minimum avoid supermarkets and shop locally in the bakery, the butcher’s shop and the greengrocers and your loyalty will soon be rewarded by the local shopkeepers.  Generally speaking supermarkets are more expensive for every day grocery items, and foreign brand foods always carry a premium.

Eating out is of course a tradition in Spain especially in the long hot summer months.  Small local restaurants are often very cheap with a meal for two costing as little as EUR 10 per person and lunchtime menus particularly affordable.  Naturally enough for those who live in areas of Seville, Madrid or Barcelona or who reside close to the main tourism hotspots eating out can be considerably more expensive as can the overall day to day costs of living in Spain – but for retirees looking to put their feet up and relax or for those looking for a modest lifestyle in the sunshine away from the hustle and bustle of everyday working life, an affordable yet enjoyable lifestyle is still possible to achieve in Spain.