Madrid’s current economic woes and the eurozone crisis are keeping the city in the headlines, as it suffers from a second recession, record unemployment and the downgrade of some of its high street banks. The mortgage crisis hit the country hard and many bad loans are still not cleared. But life in the Spanish capital still moves gracefully along, with the tapas bars and outdoor terrazas (cafes) bursting on the weekend, full of madrileños nibbling and sipping their way to early morning.

What is it known for?
Madrid is the heart of classic Castilian Spain, where residents speak in an expressive burst of consonants and vowels. The city is home to the kings and queens of Spain, who commissioned the grand architecture of various royal palaces, avenues like the Gran Via, one of Europe’s great shopping streets, and plazas and parks such as Plaza Mayor and the central Parque del Buen Retiro. The “Golden Triangle” of the Prado, Reina Sofia Museum and the Thyssen-Bornemisza Museum make up one of the most important art experiences in the world, covering Spanish and European art from the 12th Century to the modern era.

The past decade has seen a high level of investment in city infrastructure, from skyscrapers to the AVE, a high-speed rail that links Madrid to other major Spanish cities such as Barcelona and Valencia in less than four hours. Until recently, the economy and high GDP drew more people than ever to live and work in Madrid, with top chefs opening restaurants and tapas bars, an exciting live music scene, and a tradition of mid-day siestas and Sunday closings adding to the quality of life. Many madrileños are not originally from Madrid, which makes the city open and welcoming to those who come here.

Where do you want to live?
Madrid’s central districts remain popular and upscale, such as Barrio de Salamanca and Retiro, where residents are close to stores, restaurants and parks. Other central areas such as Chueca, a predominantly gay area, Malasaña just to the west of Chueca, and Lavapies, a gentrifying neighbourhood that was once the ancient Jewish quarter, appeal to a hip population with rocking bars and clubs that stay open late into the night. “Madrid still preserves its village atmosphere,” said longtime resident Fernando Sevilla. “Perhaps we are not as sophisticated and refined as Londoners or Parisians, but Madrid is a safe city and the public transport is very good.”

Families might look farther out of town to the nearby suburbs, such as La Finca, a development northwest of the city, and La Moraleja, where many of Spain’s politicians and sports figures live. 

Side trips
Many madrileños go back to their home village, or pueblo, on the weekend, especially when there are so many four-day weekends due to various holidays falling on a Tuesday or Thursday. The peaks of the Sierra de Guadarrama are a choice destination for a day’s outing of hiking in the pine forests and fields. “Spanish people love to go to the countryside and to go out walking and have picnics,” Sevilla said. The ancient towns of Toledo, Cuenca and Segovia are popular weekend getaways, and in the hot summer months, many head south to the beaches of the Mediterranean.

Spain’s high-speed rail network connects Madrid to Barcelona in just two-and-a-half hours, meaning almost no one flies between the two cities anymore. But from the Madrid-Barajas Airport, low-cost airlines such as EasyJet and Ryanair and big carriers such as Iberia and Lufthansa fly to many other European cities. Madrid is about an hour and a half flight from London and about seven hours to New York.

Practical info
The double recession and mortgage crisis has had a big effect on life in Madrid. “We compare prices when shopping and look for discounts,” Sevilla said. “Going out is cheaper now than it was three or four years ago and during the week the bars and restaurants can be mostly empty.”

In 2010, the average house price in Madrid was 3,290 euros per sqm, and in upscale Salamanca, it was 5,615 euros per sqm. But in the last quarter of 2011, housing prices in Madrid fell nearly 16% from the year before, and 32% of houses in all of Spain have been repossessed by the banks in the continuing fallout from the subprime mortgage crisis. The falling prices mean that it is a good time to buy, but with banks now acting as both lenders and estate agents, there are very few mortgages being given to Spanish citizens or foreign buyers. “Renting is a good option now, since you can bargain and get a good deal,” explained Sevilla. “But the Spanish mentality is it is always best to own a house.”

Further information

  • In Madrid: English-language magazine covering events, culture and arts in the city
  • The Olive Press: daily news from around Spain
  • La tortuga viajera: an American in Madrid blogs about travel, food and life as an ex-pat