Madrid has once again ranked among the 20 cities with the highest quality of life in the world, securing 18th place in the latest ranking published by the Deutsche Bank Research Institute. The Spanish capital now ranks ahead of cities such as Paris, London and New York, having climbed 15 positions since 2019, although it has fallen two places compared with 2025.
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According to the Deutsche Bank Research Institute's Mapping the World's Prices 2026 report, this performance is driven by factors including safety, infrastructure, mobility, the quality of urban services, rising wage levels and Madrid’s growing international appeal.
Barcelona (42nd) also maintains a strong position among Europe's leading cities, thanks to its quality of life, economic dynamism and ability to attract talent and investment, the report notes.
However, the study highlights rising housing costs as the main challenge facing both cities. In Madrid, the average net salary stands at €2,200 per month, 45% higher than a decade ago, while property prices have risen by 94% over the same period, reaching €8,013 per square metre.
The cost of renting a three-bedroom home has also increased sharply, rising by 77% over the last decade to an average of €2,493 per month.
Despite these increases, Madrid remains relatively competitive in terms of disposable income after housing costs. With an average of €1,908 per month remaining after rent, the city ranks 40th globally for this indicator.
The report concludes that Madrid and Barcelona have significantly strengthened their international appeal as places to live and work over the past decade. However, it warns that housing affordability has become one of the key factors that will shape their future competitiveness in attracting talent, investment and business activity.
The report highlights that Luxembourg has been ranked the city with the highest quality of life in the world for the second consecutive year.
In terms of the cost of living, Zurich and Geneva continue to be the world's most expensive cities, while Tokyo has slipped down the rankings following the depreciation of the yen in recent years. By contrast, Tel Aviv ranks among the five most expensive cities globally, reflecting the strengthening of the shekel and the impact of ongoing geopolitical tensions in the region.
