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Last Updated: Jun 9th, 2006 - 17:12:13 |
For many people moving to Spain as a retirement plan, a change of life plan or for work reasons one of the key questions is just how far will their money go?
Generally if you are moving from the North of Europe you will see a considerable difference in the prices in goods. If you are coming from Oslo then you are in for a very pleasant surprise! Prices in Madrid and Barcelona are about half those in Oslo. On the Costa Blanca the prices are about 80% those of Madrid and Barcelona (according to the latest numbers from the Spanish Statistics Bureau). If you come from London then you can expect costs of about 60% - still very reasonable.
Here' another way of looking at it: a loaf of bread in the UK would cost approximately 80p and on the Costa Blanca would cost just 54p. A bottle of Scotch would cost perhaps £14 in the UK supermarket and would set you back a mere £6 on the Costa Blanca. When it comes to eating out the price difference is even greater you can get a good three course meal in a restaurant for just £15 per head including wine and coffee.
Car fuel varies considerably with the economic and political world scenes. However the tax element in Spain is lower than many other countries. Over the next few years so called carbon taxes may erode the difference. Cars are also much cheaper than in the UK but more expensive then the USA. Currently diesel cars are more expensive than gasoline or petrol cars.
The only area where you may be surprised is the house prices. In Spain house prices are forecast to rise by 14% during 2004 in the first half of the year house prices rose by almost 8%. On the Costa Blanca or the Costa del Sol the price rise is likely to be even higher some 18% forecast for the year.
The average house price is Euros 1,600 (approximately Pounds 1,000) / square meter which means a house of 200 sq.m. would cost Euros 320,000 or Pounds 200,000. Of course there are many factors that will change this such as the views the quality of the building, external amenities such as a pool, whether it is detached a semi, and above all where it is located etc. Be aware that when you purchase your house you should prepare 10% of the purchase price for the taxes, duties. Mortgage commissions and legal fees involved.
Schooling is also much cheaper than in the UK. Of course there is the option of sending your children to the State schools in the village, town or city you choose to live in - this is free. This has the added advantage of making integration for them much easier at least in theory. The shock of a change of school and education style can be daunting for children. The other issue is that you may want to return to your country of origin.
There are many foreign schools in Spain that educate children following the curriculum of their home country. Examples are the Lycees Francaises, the Norwegian schools as well as the British system. In Alicante there is also a European School which runs a multilingual European Baccalaureate. Schooling can vary in prices from region to region in Madrid for example British schooling is double that of the Costa Blanca. Typically on the Costa Blanca schooling in Primary education costs 3,000 euros / child and secondary costs 50% more.
Whatever happens careful planning is required. Inheritance between husband and wife is very different in Spain compared to other countries. Death duties can be liable if one partner dies and the other partner inherits the property even when they are living in it.
The difference in prices, once you have made the initial outlay for your property, means that your money will go further. If you are thinking of retiring or semi-retiring to Spain this can be a very attractive incentive.
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