Young People Still Crushed by Housing Bust, Banking & Economic Crisis: Bank of Spain

The contrast with retirees could not be starker

Over the past five years, Spain’s economy has grown at a faster rate than almost any other in the Eurozone. But not everyone has benefited. And a new report by the Bank of Spain confirms, no one has paid as heavy a price as the generation that came of age in the years immediately before and after the collapse of Spain’s insane housing bubble and the banking crisis that followed.

The Bank of Spain’s triennial Family Financial Survey, based on data through 2017, shows that heads of households under the age of 35 saw their median gross income (income before taxes and contributions) plunge by 18% from 2010 to 2017 — more than any other age group. Median gross income of all age groups combined in 2017 was still below their 2010 levels, although three age groups — 35 to 44-year-olds, 65 to 74-year-olds and 75 to 84-year-olds — did see their incomes rise, at least on a nominal (not inflation-adjusted) basis.

When it comes to personal wealth, the data is even more dismal for the under-35s. In 2010 their median net wealth after debts stood at €71,600. But by 2017 it had collapsed 92% to €5,300. The main reason is that since the crisis, almost all under-35s have been financially excluded from the property market, largely due to their shrinking incomes levels. Other age groups have also seen their net wealth diminish, albeit less, since 2010, mainly as a result of the fall in house prices, which account for the lion’s share of household wealth in Spain.

Continue reading the article on Wolf Street

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