City Comparison · Updated May 2026
Portugal
COL index 71.2
Spain
COL index 54.9
Lisbon vs Madrid — Cost of Living, Salary & Tax Compared (2026)
The verdict
Living in Madrid is 22.9% cheaper than Lisbon for the same lifestyle.
Based on Q1 2026 COL index and median single-person expenditure.
Side-by-side stats
| Lisbon | Metric | Madrid | Δ |
|---|---|---|---|
| 71.2 | Cost of living index | 54.9 | -22.9% |
| €50,000 | Median gross salary | €50,000 | 0.0% |
| €32,496 | Net at €50,000 gross | €33,783 | +4.0% |
| €1,450 | Rent — 1BR centre | €1,380 | -4.8% |
| €2,014 | Monthly COL (single) | €1,953 | -3.0% |
| €45,641 | PPP — net / COL | €61,535 | +34.8% |
| 35.0% | Effective tax @ €50,000 | 32.4% | -7.3% |
Monthly expenses — paired
Salary equivalence
€50,000 gross in Portugal = €2,321 net monthly.
To have the same purchasing power in Madrid, you would need roughly €35,444 gross in Spain (≈ €2,088 net monthly, adjusted for cost-of-living index).
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Pros & cons
- −High rent-to-income ratio (62.5%)
- +14-month salary structure
- +Lower rent (€1,380 vs €1,450)
- −High rent-to-income ratio (57.2%)
- +14-month salary structure
The verdict
Across the data, Madrid delivers a higher take-home on a €50,000 gross salary; Madrid carries a lower cost-of-living index; Madrid has the lighter effective tax burden; Madrid wins on purchasing power after costs are netted out. If purchasing power is your north star, Madrid edges it.
Frequently asked
Is Lisbon cheaper than Madrid?+
Madrid is cheaper. Cost-of-living index: Lisbon 71.2, Madrid 54.9 — a 22.9% difference (Q1 2026).
What is the cost of living difference between Lisbon and Madrid?+
Lisbon sits at 71.2 on our COL index, Madrid at 54.9. That works out to roughly 22.9% — Madrid being the cheaper of the two.
Is Lisbon a good place to live compared to Madrid?+
It depends on priorities. Lisbon delivers €32,496 net on a €50,000 gross salary at a 35.0% effective tax rate. Madrid delivers €33,783 at 32.4%. Centre 1-bed rent: €1,450 vs €1,380.
How do salaries compare in Lisbon vs Madrid?+
On a €50,000 gross salary, take-home is €32,496/year (€2,321/month) in Lisbon and €33,783/year (€2,413/month) in Madrid.
Which city has lower taxes, Lisbon or Madrid?+
Spain has the lower effective rate at €50,000: Portugal 35.0%, Spain 32.4%.