The debate for those seeking independence or a new home after relocation is straightforward: buy or rent? The decision hinges on many factors, but one of the most persistent costs is the monthly payment, whether it be a mortgage or a rent check. A steady mortgage payment becomes a central expense shaping the household budget for years ahead.
With rent prices climbing and official rates staying low in recent years, the argument for purchasing a home has often looked favorable. A key obstacle remains the upfront funds needed to enter the property market. The Euribor’s rapid swing from negative territory to around 3 percent in a single year narrowed the gap between buying and renting. At present, buying tends to be more affordable in many towns, according to data from real estate portals and comparison tools cited in this analysis.
Therefore, given that the average price per square meter in the province sits near 1,921 euros, an 80 square meter apartment costs around 153,680 euros, with about 80 percent financing available. This means roughly 122,944 euros paid upfront through financing. If the typical spread for variable mortgages is around 0.75 percent and Euribor remains elevated, the new loan rate sits near 3.8 percent, translating to roughly a 638 euro monthly payment.
A real estate agency in the San Juan beach area.
This level of monthly obligation is more than a passing expense and, in many cases, remains lower than what would be paid in rent for a comparable property. While the square meter cost has risen, the mortgage often stays cheaper than renting by a meaningful margin. The monthly cost for renting a similar home can be significantly higher, and the gap has narrowed as mortgage rates moved upward while rents climbed as well.
Yet, despite the uptick, the mortgage payment can still be lower than the rent in many scenarios. The average rent for a similarly sized home sits around 712 euros, and rental prices have risen substantially in the province. In this context the mortgage can be about 10 percent cheaper than renting, translating to roughly 74 euros less per month on average. The difference was larger a year ago, and it remains to be seen how ongoing monetary policy moves by central banks will influence these trends.
Less financing or cash
According to the president of the real estate association, each buyer’s circumstances vary widely. A sizable share of buyers rely on financing below 80 percent, which reduces the monthly burden and allows for a larger down payment. Data from national statistics show a portion of transactions financed, reflecting a cautious stance among buyers and lenders alike.
Average mortgage and rent comparison by municipality
Among those seeking loans, credit approval remains a major hurdle. Steady income and a fixed contract are often required. The rental market faces its own challenges, with a reduced supply of suitable housing and greater uncertainty among owners about nonpayment. Authorities have implemented measures to curb price growth, and these actions have influenced owner confidence and rental availability.
The number of rental homes in the Alicante area is shrinking
In many towns, mortgage payments for an 80 square meter home are lower than the renting price. For instance in Alicante city, the average mortgage for such a home might be around 542 euros, compared with a rental cost of about 760 euros for a similar apartment. In Elche, borrowing costs around 381 euros contrast with rents around 512 euros.
Rental housing ads
In general, housing affordability varies by town. Areas with cheaper property prices often see smaller mortgage impacts relative to rents. Still, a mortgage frequently represents a smaller monthly burden than rent, though this is not universal. Some towns report mortgage costs approaching or exceeding rent, particularly where local prices have surged and borrowing conditions are tight.
Overall, the gap between mortgage payments and rents tends to widen or narrow depending on local prices and lending conditions. In higher-priced markets, mortgage costs can rise sharply, but rents may grow even faster. Conversely, in less expensive areas, mortgages may stay well within reach while rents rise more modestly. This dynamic shapes decisions for buyers and renters alike as they weigh long-term commitments and daily living costs.