-U76787272448hxk-1440x752@IlSole24Ore-Web.jpg?r=1170x507 "Costs vs Income: Affordable Housing Observatory Analysis")
Costs vs Income: Affordable Housing Observatory Analysis
- Milan faces a growing disparity between income/salaries and housing costs, pushing low-income individuals and families out of the city center and into the surrounding areas.
- This is the key finding of the second report by the Osservatorio casa Abbordabile (OCA), established to monitor housing access and affordability dynamics in Milan.
- The report translates affordability into tangible terms, showing the square meters one can afford to buy or rent in Milan based on their profession.
Milan Housing Affordability Crisis: A Deep Dive into the OCA Report
Table of Contents
- Milan Housing Affordability Crisis: A Deep Dive into the OCA Report
- Milan Housing Affordability Crisis: Your Questions Answered
- What is the osservatorio Casa Abbordabile (OCA)?
- How severe is the housing affordability crisis in milan?
- What can you afford to buy in Milan based on your profession?
- How have these figures changed over time?
- What rental options are available in Milan based on income?
- Is it more affordable to live outside of Milan?
- Milan Housing Affordability at a Glance
Milan faces a growing disparity between income/salaries and housing costs, pushing low-income individuals and families out of the city center and into the surrounding areas. While the outskirts of Milan may offer some opportunities for average salaries, this comes at the cost of financial strain due to rising prices and limited availability, as well as personal sacrifices related to commuting to Milan, where public transportation is not always efficient.
This is the key finding of the second report by the Osservatorio casa Abbordabile (OCA), established to monitor housing access and affordability dynamics in Milan. The OCA is a project promoted by the Consorzio Cooperative Lavoratori and LUM in partnership with the Department of Architecture and urban Studies (DAStU) of the Politecnico di Milano.
What Can You Afford in Milan?
The report translates affordability into tangible terms, showing the square meters one can afford to buy or rent in Milan based on their profession. in the city of Milan, a worker with an average net income of €1,360 can afford to buy an average of 19 square meters with a mortgage. An employee with an average net income of €1,836 can afford 25 square meters, while a manager with an average net income of €3,477 can afford 48 square meters. Executives, with an average net income of €7,638, can afford 105 square meters.
These figures represent a decrease in affordable square footage compared to both 2023 and the base year of 2015. Since 2015, the reduction in affordable living space has been particularly important for lower-middle-income earners (workers), who have seen a 16.7% decrease in the index of affordable square meters.Middle-income earners (employees and managers) have experienced less severe reductions of 12.7% and 12.1%, respectively, while executives have seen an 8.2% decrease.
Considering rental options, assuming a maximum expenditure of 30% of salary, a worker can afford to rent 26 square meters (2 less than in 2022), an employee 35 square meters, a manager 66 square meters, and an executive 146 square meters. Notably, even in the outer districts, dividing the municipal area into three zones – center, semi-center, and periphery – the affordability index remains critical.
Specifically,considering the impact on salary and measuring affordability against the critical threshold of 30% of net salary,the city center and semi-center are inaccessible for households relying on the average net salaries of workers and employees. They also become unaffordable for households of two or three people relying on the average net salaries of managers.
What Can You Afford Outside Milan?
The “outside Milan” area, as defined by the report, encompasses a square of approximately 60km around Milan, equivalent to a section of territory incorporating around 300 municipalities across seven provinces in Lombardy. Considering the affordability index, which uses 30% of the average income in the municipality as a benchmark and calculates the square meters that can be purchased with a mortgage, an average income is insufficient to purchase a 50 square meter home in much of Milan’s surrounding area.
This includes urban centers such as Pavia, Lodi, Abbiategrasso, Magenta, Treviglio, and throughout Brianza along the most developed infrastructure routes.
For a worker earning approximately €1,500 gross per month, the affordable municipalities are primarily those with the most difficult access to Milan by public transport, resulting in very long commute times. Renting a home outside Milan may seem like the only sustainable option for those earning €1,500 gross per month, but the data shows that living far away remains costly.
The rental situation improves, but remains critical. The impact of rent, transportation, and travel time never falls below 30% of net salary, and in the most accessible municipalities by public transport, it approaches 60%.
Milan Housing Affordability Crisis: Your Questions Answered
Milan,a city known for its fashion,finance,and culture,is facing a growing challenge: housing affordability. The rising cost of living, particularly housing, is pushing individuals and families to the outskirts, impacting their finances and quality of life. This Q&A delves into the insights from the Osservatorio casa Abbordabile (OCA) report to provide clarity on the situation.
What is the osservatorio Casa Abbordabile (OCA)?
The Osservatorio Casa Abbordabile (OCA), or Affordable Housing Observatory, of Milan is an initiative established in July 2022 to monitor housing access and affordability dynamics within the Milan metropolitan area. The OCA is a collaborative project by the Consorzio Cooperative Lavoratori and LUM, in partnership with the Department of Architecture and Urban Studies (dastu) of the Politecnico di Milano. Its primary goal is to assess the balance between housing costs and the economic capabilities of residents in the Milan metropolitan area.
How severe is the housing affordability crisis in milan?
Milan is experiencing a significant disparity between income and housing costs, leading to a crisis were many, especially those with lower incomes, are being priced out of the city center. The outskirts of Milan, while perhaps offering more affordable options, come with their own set of challenges, including financial strain due to increased prices, limited availability of housing, and the personal sacrifices associated with longer commutes, frequently enough exacerbated by inefficient public transportation. The city center and semi-center are increasingly inaccessible for those with average worker and employee salaries. Even managers may find it unaffordable for families.
What can you afford to buy in Milan based on your profession?
The OCA report breaks down affordability by profession, illustrating the square meters one can afford to purchase in Milan with a mortgage:
Worker (average net income of €1,360): 19 square meters
Employee (average net income of €1,836): 25 square meters
Manager (average net income of €3,477): 48 square meters
Executive (average net income of €7,638): 105 square meters
How have these figures changed over time?
There has been a decrease in affordable square footage since 2015. the reduction has disproportionately affected lower-middle-income earners:
workers: Experienced a 16.7% decrease in affordable square meters since 2015.
Employees: Experienced a 12.7% decrease in affordable square meters since 2015.
managers: Experienced a 12.1% decrease in affordable square meters since 2015.
Executives: Experienced an 8.2% decrease in affordable square meters since 2015.
What rental options are available in Milan based on income?
Assuming a maximum rental expenditure of 30% of salary, the OCA report indicates the following affordable rental space:
worker: 26 square meters
Employee: 35 square meters
Manager: 66 square meters
Executive: 146 square meters
It’s crucial to note that affordability remains critical even in the outer districts of Milan.
Is it more affordable to live outside of Milan?
The area “outside Milan” is defined as a 60km radius encompassing approximately 300 municipalities across seven provinces in Lombardy. While it might seem more affordable, challenges persist. An average income is often insufficient to purchase a 50 square meter home in many surrounding urban centers like pavia,Lodi,Abbiategrasso,magenta,and Treviglio.
For workers earning around €1,500 gross per month, affordable municipalities are typically those with poor public transport links to Milan, resulting in lengthy commutes. While renting outside Milan may seem lasting, the combined cost of rent, transportation, and travel time can still consume a significant portion of net salary, often exceeding 30% and, in accessible areas, approaching 60%.
Milan Housing Affordability at a Glance
| Income Level | Affordable purchase (Milan) | Affordable Rental (Milan) | Challenges outside Milan |
| :———– | :————————– | :———————— | :————————————————- |
| Worker | 19 sq meters | 26 sq meters | Long commutes, high transport costs |
| Employee | 25 sq meters | 35 sq meters | Combined rent and transport exceeding 30% of salary |
| Manager | 48 sq meters | 66 sq meters | High property prices in accessible urban centers |
| executive | 105 sq meters | 146 sq meters | |