household spending in valencia shows strong rebound in the past year
Household expenditures in the community of Valencia recovered solidly over the last year as economic and social life resumed after the pandemic. The rise in living costs and energy prices contributed to the momentum, pushing this indicator above the 2019 level, at least in nominal terms. Real consumption, after adjusting for inflation, remains slightly below pre-pandemic levels.
According to the INE Family Budget Survey, the average annual household spending on autonomous or discretionary items rose to 29,969 euros last year, up 1,911 euros from the previous year, a 6.8 percent increase. This figure surpassed the pre-pandemic level of 29,444 euros by 1.8 percent.
However, the increase is somewhat more modest than the national rise of 7.9 percent. Valencia’s average household expenditure stands at 31,568 euros, which is still below the national average in total household spending. The INE notes that inflation affects these comparisons: without price changes, the national increase would be around 2 percent. The same pattern holds when comparing with 2019: households spent 4.4 percent more in nominal terms, yet actual consumption volume remained about 3.2 percent lower when inflation is accounted for.
Looking at the breakdown by category, housing remains the largest and most rapidly rising component, totaling 9,398 euros — 440 euros more than the previous year. This uptick reflects higher rents, real estate costs, and related materials. Electricity bills increased by an average of 161 euros per household.
Another notable rise occurred in restaurants and hotels, where Valencian households spent 432 euros more, reaching 2,776 euros per family per year in 2021. While inflation contributed to this growth, the recovery of social life also played a role, not fully returning to the pre-pandemic level. Expenditure on bars, restaurants, and tourism remained 172 euros below 2019 levels last year.
Entertainment and culture also rose, by 218 euros to a total of 1,542 euros per household annually, yet still 235 euros below 2019 levels. Transport spending grew by 386 euros to 3,581 euros, largely driven by higher fuel prices and policies to mitigate their impact, such as a 0.20 euro per liter discount. Despite subsidies, each Valencian household paid about 264 euros more for fuel, and vehicle maintenance costs rose by 162 euros.
In another area, food and beverages represented an average expense of 4,710 euros per household, up 146 euros from the previous year and roughly 600 euros above pre-pandemic levels. This suggests that some of the behavioral changes adopted during the pandemic have persisted.
Additionally, spending on hairdressing and other personal care services rose as social life revived, with households allocating more than 50 euros extra per year for these services.
alarming trend: a two-year decline in purchasing power for valencia workers
The data also indicates a decline in purchasing power for workers in the province of Alicante, with a decrease of about 1,300 euros over two years. In terms of categories, the only declines were in alcoholic beverages and tobacco by 72 euros, furniture and home appliances by 16 euros, communication due to lower telephone tariffs by 40 euros, and teaching-related telecom costs by 29 euros.
On the national stage, Madrid-based households earned the most over the year at 36,197 euros, while Extremadura households earned the least at 26,634 euros. [INE, Family Budget Survey]