Is Spain Still Affordable? A Look at the Cost of Living

Is Spain Still Affordable? A Closer Look at the Cost of Living

When you think of Spain, you might picture endless sunshine, vibrant festivals, and afternoon siestas. But if you're considering making Spain your home or planning a long stay, the question on your mind might be: Is Spain still affordable?

Thanks to Deutsche Bank’s latest global rankings, we now have a clearer picture of how Spain’s cost of living compares to other countries. Spoiler alert: while it’s still cheaper than many of its European neighbors, it’s no longer the budget haven it once was.

A Reputation for Affordability

Spain has long been known for its affordability—especially when compared to countries like France, the UK, or the Nordics. From the sun-drenched beaches of the Costa Brava to the historic streets of Madrid, the cost of living in Spain used to offer a pretty sweet deal for both locals and expats.

But the landscape is shifting. When we look at Spain’s largest cities—Madrid and Barcelona—while they’re certainly more affordable than global heavyweights like London, New York, and Zurich, they’re no longer the bargain they once were. So, what gives?

The Cost of Living in Spain Today

Overall, when we consider basic living expenses—such as groceries, utilities, transportation, and leisure activities—Spain’s cities rank about average on the global scale. Sure, Madrid and Barcelona might still feel like a good deal compared to places like London or Singapore, but in a broader context, the gap is narrowing.

For example, food, clothing, and most services in Spain remain relatively affordable, especially compared to Northern Europe. But certain items—like imported goods, branded electronics, and petrol—can hit your wallet harder than expected. This is often due to high indirect taxes and Spain’s smaller economies of scale, making some goods more expensive.

Salaries and Purchasing Power: The Hidden Challenge

One of the key factors that affects affordability in Spain is the local salary structure. While the prices themselves might look reasonable, the average salary in Spain doesn’t always match up. Local purchasing power—the ability to cover costs with your income—remains lower than in many Western European countries.

In cities like Zurich, Frankfurt, or Dublin, residents may find day-to-day living more affordable despite higher overall prices. Why? Because salaries in those cities tend to be much higher, giving locals more financial breathing room. In Spain, while the cost of living might seem moderate, the local salaries can feel restrictive, especially when rent and utilities take up a significant portion of one’s income.

What’s Still a Good Deal in Spain?

Even though the cost of living in Spain is rising, there are still areas where the country truly shines:

Public Transport: Spain’s public transport system is reliable, affordable, and well-connected. Whether you’re navigating Madrid’s metro system or hopping on a bus in Barcelona, getting around is both easy and cheap.

Dining Out: Eating out in Spain remains a steal compared to Northern Europe or the US. Whether it’s a casual tapas bar or a family-run restaurant, food prices are often surprisingly low. Spanish cuisine is as delicious as it is affordable.

Healthcare: Spain’s healthcare system provides high-quality care at a fraction of the cost seen in countries like the US or the UK. Whether through public or private health insurance, residents benefit from solid health outcomes without breaking the bank.

Cultural Life: Spain offers a rich cultural life that’s accessible to everyone. Museums, festivals, and concerts are often free or subsidized, making cultural experiences affordable for locals and visitors alike.

The Bottom Line

So, is Spain still affordable? In a global context, it’s not quite the bargain it used to be—but it’s still a great value for money, especially if you’re earning international-level salaries, pensions, or remote income. While salaries might not be as high as some other Western European countries, Spain’s cost of living remains manageable in many areas, with good value in transport, food, healthcare, and cultural experiences.

In short, life in Spain may not be globally cheap, but it still offers a high quality of life at a relatively affordable price—especially for those who can take advantage of Spain’s lower everyday costs while earning from international sources.

So, if you’re dreaming of life in Spain, don’t let the rising cost of living scare you off. With the right financial planning, the sunny streets of Madrid or Barcelona could still be within reach.