Thinking of moving overseas. You may need to reconsider. Of all the countries in the world, it seems that South Africa is still the most affordable in which to buy a house. According to a recent article in Real Estate Investor Magazine, South Africa is the fourth most affordable country to buy a house in. The article is based on research done by https://comparethemarket.com.au/.
Compare the market looked at the average property prices per square metre and the average disposable household income in each country to calculate the cost per square metre as a percentage of annual income.
Turkey is the most affordable
At the top of the most affordable list, is Turkey with the lowest price per square metre (A$1,131), which, with an average household income of A$27,087, means an affordability ratio of just 4.2%, i.e. the percentage of disposable income spent on housing.
The USA is the 2nd most affordable because of its higher income ratio
Despite having a much higher property price of A$3,683 per square metre, the USA was the second most affordable country as it has a higher average income (A$67,020) and hence an affordability ratio of 5.5%.
Russia is the 3rd most affordable
Russia boasts an average price per square metre of A$1,557 and an average household disposable income of A$26,390, hence an affordability ratio of 5.9%.
South Africa is in 4th place
The research shows an average price per square metre for South Africa of A$1,248 and an average disposable income of A$17,156 with an affordability ratio of 7.2% of income spent on housing.
According to https://www.numbeo.com/, the world's largest cost of living database, the cost of living in South Africa is, however, some 45.78% lower than the average for the United States and rent is on average 62.40% lower. Johannesburg and Pretoria are the cheapest to live in while Cape Town and Durban rank as the most expensive.
Other countries in the top ten most affordable include Mexico, Lithuania, Brazil, Latvia, Slovakia and Greece.
The least affordable countries to buy a house in are South Korea and Israel.
Most people will struggle to buy a house in South Korea, which is known for its high cost of living, with an average property cost of A$12,810 per square metre, average household income of A$32,385, resulting in the highest affordability ratio on our list, 39.6%.
Israel is the second most expensive in terms of percentage of household income spent on housing. The average household income is A$36,797 and the average price per square metre A$9,780 with an affordability ratio of 26.6%.
The next three least affordable nations on the list are all known for having a high cost of living, being Switzerland (26.5%), Luxembourg (23.7%) and Japan (23.2%).
Visit https://comparethemarket.com.au/home-contents-insurance/global-cost-of-property/ for more.