RTL Today – Mortgage madness?

Average mortgage payments in Luxembourg are 51.1% higher than the average rent, while rent and house prices are the highest in the group of developed OECD countries.

The so-called price gap between house prices and rents is an indicator of the cost of buying a house with a standard mortgage compared to the average monthly rent.

According to a study by price comparison site Compare The Market, the average rent in Luxembourg for a three-bedroom house is $3,017 (€2,634) per month, while the equivalent monthly mortgage payment is $4,558. $ (€3,980).

Latvia, second, has a price gap of 42.5%, but the prices for rents ($582 or €508 per month) and mortgages ($830 or €725 per month) are much lower.

In two OECD countries, average mortgage payments are lower than rents. The price gap in Finland is -2.1%, with average mortgage payments of $1,258 (€1,098) representing slightly less than an average rent of $1,285 (€1,122). Italy also benefits from mortgages that are cheaper than rental prices, with a price gap calculated at -0.9%.

Highest rent and mortgage prices

At around $4,558 (€3,980) per month, average monthly mortgage payments in Luxembourg are well above the OECD average. Ranked in this way, second-place Switzerland is priced at a much more affordable $2,961 (€2,586) per month.

Meanwhile, Luxembourg’s average is ten times higher than Turkey’s, at $441 (€385) per month.

Rents are equally staggering, with the average three-bed costing $3,017 (€2,634) in the Grand Duchy, compared to $2,599 (€2,269) in second-place Switzerland. Turkey is again the lowest in the OECD, at $372 (€324) per month.

How about something more affordable and nearby? Average rents and mortgages are much lower among the Grand Duchy’s neighbors – Belgium being on average the most affordable. Monthly rents are $1,224 (€1,069) and mortgage payments are $1,384 (€1,209).

Top 10 biggest price gaps

Rank Country Average rent $ (3 bedrooms) Monthly mortgage payment $ (est.) Difference between property price and rent
1 Luxemburg 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%
seven Czech Republic 861 1,205 40.0%
8 New Zealand 1,656 2,234 34.9%
9 Germany 1,414 1,887 33.5%
ten Canada 1,597 2,118 32.6%

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