One of the sunniest cities in Europe, Madrid boasts an average of 350 days of sunshine annually. It’s no wonder people from all over Europe and the world relocate to Madrid to soak up the sun in the Spanish capital and take advantage of its wonderful way of life. With the high quality of life comes an equally high price tag: according to Mercer’s 2023 Cost of Living Survey, Madrid is ranked as the 83rd most expensive city for expats out of 227 cities surveyed.

Still, Madrid is relatively affordable for a Western European capital, especially when compared to the likes of Bern and London. The city is also Spain’s commercial and political hub, which means lucrative job opportunities are plentiful.

Cost of accommodation in Madrid  

Accommodation in Madrid is the second priciest in Spain, following Barcelona as the country's most expensive city to rent in. Securing well-priced and quality accommodation in the city centre is notoriously challenging. The properties in the city centre are usually older with few modern amenities, but they offer quick access to Madrid's commercial hub.   

Housing in the outlying areas of the city tends to be more popular among expats, as the apartments and houses are often larger and better equipped at a lower price than in the city centre. Madrid’s transport system is also well-developed and affordable, making commuting easy.

Cost of transport in Madrid  

Expats will find that life in the capital without a car is easy and even preferable. With a population of 6.8 million, Madrid's roads are congested, while parking is scarce and expensive. The efficient public transport system includes buses, a metro and taxis, all of which offer day and night access to all the districts in the city.  

Expats keen on buying a car should prepare to navigate the infamous Spanish bureaucracy. Expats eager to avoid this often pay a small additional fee to the dealership, which then handles all the paperwork.

Cost of food in Madrid   

Spanish cuisine is one of the most famous in the world. Some staples include olive oil, seafood, fresh produce and wine. Expats looking to adopt a Mediterranean diet can expect to spend significantly less than on a diet that contains a lot of red meat and dairy products, as these can be costly in Madrid.   

Eating out in Madrid is generally more affordable than in other European cities, and the capital enjoys fresh fruit and vegetables throughout the year thanks to the sunny climate.

Cost of entertainment in Madrid   

Madrid is well known for its art museums, nightlife and theatre scene, while it’s no surprise that sport is a big part of the city’s entertainment seeing as it’s home to two world-famous football teams, namely Real- and Atlético Madrid. Food and drink in the city cost significantly less than in the likes of London, Paris and Rome.  

The city also offers multiple manicured parks ideal for running, walking or picnicking. Most of these green spaces are free to access, making them an excellent option for expats on a tight budget.

Cost of living in Spain chart

Prices may vary across the city, depending on product and service provider. The list below shows average prices for Madrid in February 2023.