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|