Spain housing costs drive two million people into ‘hidden poverty’

A study by the Foundation for Applied Economics Studies (Fedea) reveals that nearly two million people in Spain are experiencing ‘hidden poverty’ due to housing costs. The report, titled ‘The Cost of Housing and Hidden Poverty in Spain: 2014-2025’, indicates that while these individuals may not be classified as poor based solely on their disposable income, they fall below the poverty threshold once rent is paid.

According to the findings, 25.4% of tenants who were not previously considered poor fall into poverty after paying market-rate rents. This phenomenon is most acute in the rental sector, which accounts for over 70% of these newly identified impoverished individuals. In contrast, those paying below-market rates—such as through social housing or family arrangements—see a lower impact, with 15.4% crossing the poverty line.

Homeownership provides a significant buffer against this economic vulnerability; only 3.2% of mortgage holders fall into poverty after making their monthly payments. The study highlights a growing gap between wages and housing costs, creating a new pathway to financial instability for many residents.