New research conducted by Compare The Market analyzing average house and rent prices in Organization for Economic Cooperation and Development (OECD) countries reveals the most expensive countries to rent and buy property in.
According to the study, the United States ranks 5th among the 10 most expensive OECD countries for both renting and buying homes, with rent and mortgage costs averaging $1,971 and $2,328 per month, respectively. That's a difference of just 18.1% - or about $357 per month - which is the 22nd highest difference between rent and buying in the world.
Average rent (three bedrooms)
Estimated monthly mortgage payment
Difference between house prices and rent
Only four European countries outrank the US in terms of housing costs; Ireland, Iceland, Switzerland and the most expensive, Luxembourg. Luxembourg is notorious for its high cost of living, which is clearly reflected in its house and rent prices. Average rent and mortgage costs in Luxembourg reach $3,017 and $4,558 per month, representing a price gap of 51.1%, the largest price difference out of all the OECD countries.
Neighboring Switzerland ranked second, with a considerable drop in average monthly rent and mortgage costs of $2,599 and $2,961, respectively. Iceland came in third, with the average cost of rent hitting $2,036 a month and monthly mortgage payments of $2,610.
It's interesting to note that Finland and Italy were the only countries to have a negative price difference margin - meaning that it is actually cheaper to buy a house in either of those countries than it is to rent one. South Africa held the lowest price difference at 0.8%, with rent prices averaging at $865 and the average mortgage payment being $872 - a price difference of just $7.
You can view the research and full 38-nation ranking here.