In Tallinn, affordability decreased by 1.6 points in the fourth quarter of last year compared with the same period in 2015, as price growth outpacednwage growth.
- In Riga, the HAI increased by 25.5 points as prices and interest rates decreased.
- In Vilnius, the HAI declined by 4.6 points because apartment price growth continued to outpace wage growth.
- The time needed to save for a down payment increased by 2.5 weeks in Tallinn and by more than one month in Vilnius, to 29.1 and 36.8 months, respectively; it decreased by almost 2 months, to 22.8 months, in Riga.
The housing affordability index (HAI) is calculated for a family whose income is equal to 1.5 of average net wages with an average-sized apartment of 55 square meters. The HAI is 100 when households use 30% of their net wages for mortgage costs. When the HAI is at least 100, households can afford their housing, according to the established norm. The higher the number, the greater the affordability.
