Lit.Org - a community for readers and writers Advanced Search

Average Rating

(0 votes)

You must login to vote

By Sam Vaknin
Author of "Malignant Self Love - Narcissism Revisited"

In most developed countries, the renting of residential property (apartments) provides the owner with an annual income equal to 2-3% of the value of his or her real estate. In developing countries, owners make 6-7%. An apartment selling for 100,000 euros will often rent for 7000 euros a year. One pays the same to rent an apartment in Skopje, Macedonia and in Berlin, Germany even though, in Berlin, apartments are three to five times more expensive to buy.

Why this excess yield?

Five reasons:

(1) Limited supply. Despite the construction craze of recent years, there is still a shortage of apartments, especially properties to let.

(2) Criminals and politicians, whose sources of funding are unlimited, jack up the prices and rarely bargain. They use other people's money to pay for their luxuries and don't care to save or to secure a reasonable price.

(3) Foreigners who live in developing countries are usually employed by NGOs, international financial institutions (IFIs), and multinationals. Their employers pay their expenses and have little time and inclination to haggle over the rent in a crowded market. They pay the asking price every time.

(4) Yuppies - young, upwardly mobile entrants to the workforce, employed mainly in the financial services industry - earn 3 to 6 times the average salary and can afford to pay exorbitant rents.

(5) The process of urbanization in developing countries is unrelenting. Tens of thousands of peasants and villagers relocate to the cities every year, with capital cities or commercial centers their main destinations. They support rental prices by increasing the demand, although they cannot usually afford the more expensive apartments.


Author Bio

Sam Vaknin ( ) is the author of Malignant Self Love - Narcissism Revisited and After the Rain - How the West Lost the East.

He served as a columnist for Central Europe Review, Global Politician, PopMatters, eBookWeb , and Bellaonline, and as a United Press International (UPI) Senior Business Correspondent. He was the editor of mental health and Central East Europe categories in The Open Directory and Suite101.

Visit Sam's Web site at

Related Items


The following comments are for "Why Apartment Rental Prices in Developing Countries are So High?"
by samvak

Add Your Comment

You Must be a member to post comments and ratings. If you are NOT already a member, signup now it only takes a few seconds!

All Fields are required

Commenting Guidelines:
  • All comments must be about the writing. Non-related comments will be deleted.
  • Flaming, derogatory or messages attacking other members well be deleted.
  • Adult/Sexual comments or messages will be deleted.
  • All subjects MUST be PG. No cursing in subjects.
  • All comments must follow the sites posting guidelines.
The purpose of commenting on Lit.Org is to help writers improve their writing. Please post constructive feedback to help the author improve their work.