Survey of Household Finances: is Spain not a country for the young? (part 2, two years later)

Two years ago, we published in our Monthly Report the Focus «Survey of Household Finances: Spain is not a country for the young», in which we analysed the evolution of differences between young Spanish households and those of other generations – the so-called generation gap – in terms of income and wealth, as well as divergences in home ownership rates and levels of indebtedness. The analysis was based on data from the 2022 Survey of Household Finances (EFF, in Spanish), conducted by the Bank of Spain.

The article documented a deterioration of the relative position of young households compared to other generations, particularly with regard to wealth. Two years on, with the ninth edition of the EFF conducted in 2024 now available, based on 6,250 household surveys that enable a characterisation of the distribution of the main income and wealth variables among Spain’s 19.5 million households, it is time to revisit those results and analyse whether our conclusions remain valid.

At an aggregate level, the EFF reports that the median income1 of Spanish households reached a historic high in real terms in 20232,3 (36,100 euros, at 2024 prices) and surpassed its 2001 level after growing by a notable 3.8% annually between 2021 and 2023. The median gross wealth of households has also increased, reaching 195,650 euros in 2024, after growing by 0.9% per year in real terms since 2022. It is practically at 2014 levels, albeit still far from the peak of the bubble.

This overall trend in both income and wealth masks significant generational differences. In the more recent period, between 2021 and 2023, the gross income of young households4 (with a head of household under 35 years old) has grown at an annual rate of 3.1%, slightly below the aggregate; that of households aged 35-44 years, by 3.9%, in line with the aggregate; and that of households aged 45-54 years, by just 1.4%. In contrast, the income of households aged 65-74 has increased by a notable 6.3% annually, driven largely by the indexation of pensions to inflation.

The comparison with the previous historical income peaks – reached in 2001 – continues to reveal a marked generation gap. Only households with a head aged over 65 have managed to exceed this maximum, while those aged 35-44 have almost matched it (a decline of 2.1%). In contrast, young households and those aged 45-54 continue to have a gross income well below the 2001 level, with declines of 16.8% and 15.0%, respectively.

In the more recent period, from 2022 to 2024, the gross wealth of those under 35 has grown at a remarkable annual rate of 8.3%, far outpacing the aggregate rate of 0.9%. This increase has been driven by some of this group entering the housing market during a boom in the property cycle. Meanwhile, it has decreased at an annual rate of 7.9% among households aged 35-44, while it has increased by 5.4% annually among those aged 55-74.

This recent growth has partially moderated the accumulated deterioration since 2014, although it remains very significant: whereas in 2022 the gross wealth of young people was 57% below the 2014 level, 5 by 2024 this gap had reduced to 50%. In comparison, in 2024, gross wealth was 29% lower than in 2014 for households aged 35-44, 10% lower for those aged 45-54, and just 3% lower for those aged 55-64. Finally – and this is where the generation gap is most evident – over the past decade, gross wealth has increased by 2.1% among households aged 65 to 74 and by a remarkable 35.9% among those over 75. Consequently, the generation gap remains significant, both in income and in wealth.

The main reason for this wealth disparity is the difficulty young people face in acquiring a home, given the importance of real estate property in household wealth in Spain. This importance is reflected in the fact that, in 2024, real estate assets accounted for 77% of the total asset value of Spanish households, compared to 23% for financial assets (80 vs. 20 in the case of young households). The proportion of households under 35 years old who own their primary residence fell from 66% in 2002 to 32% in 2022. The 2024 EFF reveals that, for the first time since 2011, this rate increased slightly, reaching around 36% in 2024 for this age group.6 Nevertheless, the level remains very low and a far cry from the 85% for those aged over 64. Interestingly, households aged between 35 and 44, belonging to the millennial generation, saw their ownership rate decrease from 62% to 56% between 2022 and 2024, far below the 78% recorded in 2002. Not owning a home – the main asset of household wealth – means that young people accumulate much less wealth. On the other hand, since financial assets only represent a small fraction of young people’s total wealth (the median value of financial assets among those under 35 is 6,000 euros, and 10,600 euros for those aged between 35 and 44), home ownership remains the determining factor in the generational wealth gap. The percentage of young households who own products such as investment funds or shares is slightly higher than 20 years ago,7 but the amount allocated remains relatively small.