The 10 countries with the biggest gap between house prices and rent
|
Rank |
Country |
Average rent (three bedrooms) |
Estimated monthly mortgage payment |
Difference between house prices and rent |
|
1 |
Luxembourg |
$3,017 |
$4,558 |
51.1% |
|
2 |
Latvia |
$582 |
$830 |
42.5% |
|
3 |
Slovakia |
$771 |
$1,098 |
42.3% |
|
4 |
Portugal |
$1,005 |
$1,419 |
41.2% |
|
5 |
Hungary |
$583 |
$822 |
40.9% |
|
6 |
Russia |
$746 |
$1,045 |
40.1% |
|
7 |
Czech Republic |
$861 |
$1,205 |
40.0% |
|
8 |
New Zealand |
$1,656 |
$2,234 |
34.9% |
|
9 |
Germany |
$1,414 |
$1,887 |
33.5% |
|
10 |
Canada |
$1,597 |
$2,118 |
32.6% |
Luxembourg ranked highest with a staggering price gap of 51.1%, reflecting the high cost of living. Luxembourg also has the highest rent and house prices on average with rent costing $3,017 a month, paired with a steep estimated monthly mortgage payment of $4,558.
Further insights:
-
On the opposite end of the scale, South Africa held a 0.8% price difference with rent prices averaging at $865 and the average mortgage payment being $872.
-
Two countries also held negative price difference percentages, with Finland and Italy having cheaper house prices overall than rent.
Methodology
The research is in US$.
The house price to rent ratio for each country was sourced from OECD and is calculated by dividing the nominal house price index by the housing rent price index from the same source. For example, a ratio of 151.1 means that house prices are 51.1% more expensive than renting.
The average rent for a three-bedroom property in each country was calculated by averaging the average cost of renting a three-bedroom property both in and outside of city centres, according to Numbeo.
Average monthly mortgage payments were then estimated by multiplying the house price to rent ratio by the average rent.
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Source: Press release
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