{"id":2363,"date":"2022-04-15T09:48:06","date_gmt":"2022-04-15T09:48:06","guid":{"rendered":"https:\/\/royabhishek.in\/urbanbuyer\/australian-housing-affordability-among-the-worst-in-the-world\/"},"modified":"2022-04-15T09:48:06","modified_gmt":"2022-04-15T09:48:06","slug":"australian-housing-affordability-among-the-worst-in-the-world","status":"publish","type":"post","link":"https:\/\/royabhishek.in\/urbanbuyer\/australian-housing-affordability-among-the-worst-in-the-world\/","title":{"rendered":"Australian housing affordability among the worst in the world"},"content":{"rendered":"<p> [ad_1]<br \/>\n<\/p>\n<div>\n<div id=\"toc_container\" class=\"no_bullets\">\n<p class=\"toc_title\">Please use the menu below to navigate to any article section:<\/p>\n<\/div>\n<p><strong>High prices, low supply, and rocketing demand mean Australia\u2019s <u><a href=\"https:\/\/propertyupdate.com.au\/housing-affordability-after-the-inquiry-its-time-to-execute\/\" target=\"_blank\" rel=\"noopener\">housing affordability<\/a><\/u> is now among the worst in the world, according to a new report.<\/strong><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" loading=\"lazy\" class=\"alignright size-medium wp-image-161918 img-responsive\" src=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/02\/house-price-300x225.jpg\" alt=\"House Price\" width=\"300\" height=\"225\" srcset=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/02\/house-price-300x225.jpg 300w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/02\/house-price.jpg 800w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\"\/>The <u><a href=\"http:\/\/www.demographia.com\/db-dhi-index.htm\" target=\"_blank\" rel=\"noopener\">2022 Demographia International Housing Affordability report<\/a><\/u> ranks <u><a href=\"https:\/\/propertyupdate.com.au\/property-investment-sydney\/\" target=\"_blank\" rel=\"noopener\">Sydney<\/a><\/u> in second place for being the least affordable housing market internationally \u2013 only behind Hong Kong \u2013 with several other Australian cities also making the top 20 list.<\/p>\n<p>In fact 5 Australian capitals rank amongst the 20 most unaffordable cities in the world.<\/p>\n<p>And these rankings come as no surprise given the national median house price surged 25.7%, and units by 7.7% in the year to December 2021, with little sign of cooling.<\/p>\n<p>The report \u2013 which uses a cost versus income ratio to assess <u><a href=\"https:\/\/propertyupdate.com.au\/corelogics-national-home-value-index-posted-a-0-6-gain-in-february\/\" target=\"_blank\" rel=\"noopener\">house prices<\/a><\/u> for 92 major markets across Australia, Canada, China, Ireland, New Zealand, Singapore, the UK, and the US \u2013 ranks 5 Australian cities in the top 20 \u2018least affordable\u2019 list.<\/p>\n<h2><span id=\"the-20-least-affordable-cities-to-buy-a-house\">The 20 least affordable cities to buy a house<\/span><\/h2>\n<p>According to Demographia\u2019s report, the least affordable cities (listed below with the median multiple of house prices relative to income) are:<\/p>\n<ol>\n<li style=\"line-height: 2;\">Hong Kong, China (23.2)<\/li>\n<li style=\"line-height: 2;\"><strong>Sydney, NSW, Australia (15.3)<\/strong><\/li>\n<li style=\"line-height: 2;\">Vancouver, British Columbia, Canada (13.3)<\/li>\n<li style=\"line-height: 2;\">San Jose, California, US (12.6)<\/li>\n<li style=\"line-height: 2;\"><strong>Melbourne, Australia (12.1)<\/strong><\/li>\n<li style=\"line-height: 2;\">Honolulu, Hawaii, US (12)<\/li>\n<li style=\"line-height: 2;\">San Francisco, California, US (11.8)<\/li>\n<li style=\"line-height: 2;\">Auckland, New Zealand (11.2)<\/li>\n<li style=\"line-height: 2;\">Los Angeles, California, US (10.7)<\/li>\n<li style=\"line-height: 2;\">Toronto, Ontario, Canada (10.5)<\/li>\n<li style=\"line-height: 2;\">San Diego, California, US (10.1)<\/li>\n<li style=\"line-height: 2;\">Miami, Florida, US (8.1)<\/li>\n<li style=\"line-height: 2;\">London, UK (8)<\/li>\n<li style=\"line-height: 2;\"><strong>Adelaide, SA, Australia (8)<\/strong><\/li>\n<li style=\"line-height: 2;\">Seattle, Washington, US (7.5)<\/li>\n<li style=\"line-height: 2;\">Riverside-San Bernadino, California, US (7.4)<\/li>\n<li style=\"line-height: 2;\"><strong>Brisbane, QLD, Australia (7.4)<\/strong><\/li>\n<li style=\"line-height: 2;\">Denver, Colorado, US (7.2)<\/li>\n<li style=\"line-height: 2;\">New York, New York, US (7.1)<\/li>\n<li style=\"line-height: 2;\"><strong>Perth, WA, Australia (7.1)<\/strong><\/li>\n<\/ol>\n<h2><span id=\"sydney-is-now-the-2nd-least-affordable-city-in-the-world\">Sydney is now the 2nd-least affordable city in the world<\/span><\/h2>\n<p>With prices over 15.3 times its measure of middle-income <u><a href=\"https:\/\/propertyupdate.com.au\/a-long-term-outlook-on-housing-affordability\/\" target=\"_blank\" rel=\"noopener\">housing affordability<\/a><\/u> (median house prices divided by gross median household income in Q3 2021), the report finds Sydney has the second most unaffordable housing market in the world.<\/p>\n<p>The report ranks Sydney second only to Hong Kong, where property prices are 23.2 times the average annual income \u2013 the most unaffordable property market in the world.<\/p>\n<p><u><a href=\"https:\/\/propertyupdate.com.au\/property-investment-melbourne\/\" target=\"_blank\" rel=\"noopener\">Melbourne<\/a><\/u> also makes the top of the list in fifth place with property prices 12.1 times the average annual gross median household income.<\/p>\n<p>Elsewhere on the top 20 list, Adelaide sits in 14th place, <u><a href=\"https:\/\/propertyupdate.com.au\/whats-ahead-brisbanes-property-market\/\" target=\"_blank\" rel=\"noopener\">Brisbane<\/a><\/u> in 17th, and Perth in 20th place.<\/p>\n<p>In these Australian cities, median property prices are 8, 7.4, and 7.1 times the city\u2019s average annual household income.<\/p>\n<p>Surprisingly, New York is in the number 19 spot, equal to Perth, meaning that relative to median household income, houses are now less affordable in many Aussie capitals than they are in \u201cThe Big Apple\u201d, America\u2019s most populous city.<\/p>\n<h2><span id=\"why-do-our-australian-cities-rank-so-high-on-the-list\">Why do our Australian cities rank so high on the list?<\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" loading=\"lazy\" class=\"alignright size-medium wp-image-162131 img-responsive\" src=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/melbourne-300x200.jpg\" alt=\"Melbourne\" width=\"300\" height=\"200\" srcset=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/melbourne-300x200.jpg 300w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/melbourne.jpg 600w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\"\/>In short, we\u2019ve seen a pandemic-induced housing affordability slump.<\/p>\n<p>As the report explains, the \u201cdemand shock\u201d seen during the past 2 years has led to an unprecedented deterioration in housing affordability across the nation, squeezing many people out of the market.<\/p>\n<p>The Reserve Bank has lowered and held, the cash rate at a record-low 0.10% since November 2020 in an attempt to ward off some of the economic side effects of the extended Covid-19 pandemic.<\/p>\n<p>And it was this, in combination with a sea- and tree-change shift away from our major cities in search of more space and lower prices, which has also driven up property prices in once-affordable cities like Brisbane as well as many regional areas.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" loading=\"lazy\" class=\"alignright size-medium wp-image-155063 img-responsive\" src=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2021\/07\/sydney-1-300x225.jpg\" alt=\"Sydney\" width=\"300\" height=\"225\" srcset=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2021\/07\/sydney-1-300x225.jpg 300w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2021\/07\/sydney-1.jpg 800w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\"\/>As we know, Australia\u2019s cost of living has also come under scrutiny, something which has attempted to have been addressed in this year\u2019s Federal Budget.<\/p>\n<p>The high housing costs now posed a threat to the middle-income standard of living in Australia, and in other cities around the world, as affordable housing becomes further and further out of reach.<\/p>\n<p><em>\u201c[The cost] of essential parts of the middle-class lifestyle has increased faster than inflation; house prices have been growing three times faster than household median income over the last two decades,\u201d<\/em> the report\u2019s authors point out, noting that <em>\u201chousing has been the main driver of rising middle-class expenditure in recent decades.\u201d<\/em><\/p>\n<h2><span id=\"interest-rates-may-hike\">Interest rates may hike<\/span><\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" loading=\"lazy\" class=\"alignright size-medium wp-image-162153 img-responsive\" src=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/interest-300x200.jpg\" alt=\"Interest\" width=\"300\" height=\"200\" srcset=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/interest-300x200.jpg 300w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2022\/03\/interest.jpg 600w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\"\/><\/p>\n<p>Lower mortgage rates have been a significant driver of the property increase in prices seen over the past couple of years.<\/p>\n<p>But the likelihood of a cash rate increase in the near to medium-term future has increased significantly.<\/p>\n<p>Since the onset of the pandemic, the RBA has provided significant economic stimulus and support and has repeatedly stated that they don\u2019t expect conditions for a rate increase will be met until 2024.<\/p>\n<p>And the banks suggest that property owners could face higher mortgage repayments as early as <u><a href=\"https:\/\/www.smh.com.au\/property\/news\/interest-rate-rises-expected-in-june-with-mortgage-repayments-to-rise-20220215-p59whs.html\" target=\"_blank\" rel=\"noopener\">June<\/a><\/u> as financial markets and economists warn a rapid run-up in inflation could force the <u><a href=\"https:\/\/propertyupdate.com.au\/weekly-economic-update-its-too-early-for-the-rba-to-pull-the-trigger-on-interest-rates\/\">Reserve Bank<\/a><\/u> to lift official rates above 2% within the next 12 months.<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" loading=\"lazy\" class=\"alignright size-medium wp-image-147506 img-responsive\" src=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit-300x145.jpg\" alt=\"Lending Interest Credit\" width=\"300\" height=\"145\" srcset=\"https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit-300x145.jpg 300w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit-1428x692.jpg 1428w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit-1536x744.jpg 1536w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit-1160x562.jpg 1160w, https:\/\/cdn.propertyupdate.com.au\/wp-content\/uploads\/2020\/10\/lending-interest-credit.jpg 2000w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\"\/>Combined with growing concern about the upcoming federal election and the rising cost of living, CBA said it believed the Reserve Bank would have to start increasing <u><a href=\"https:\/\/propertyupdate.com.au\/rising-interest-rates-dont-burst-property-markets\/\" target=\"_blank\" rel=\"noopener\">interest rates<\/a><\/u> by the middle of the year.<\/p>\n<p>However, I don\u2019t see the RBA raising interest rates as soon as that dash the waiting for consistent stronger incomes growth.<\/p>\n<p>Sure property values in our capital cities are expensive, but that\u2019s the cost of living in large, world-class, seaside cities in the best country in the world.<\/p>\n<p>However, with an improving economy and more migrants coming into our country to compete for space, while the pace of property price growth is going to slow over the year, there is no property slump ahead.<\/p>\n<\/div>\n<p>[ad_2]<br \/>\n<br \/><a href=\"https:\/\/propertyupdate.com.au\/australian-housing-affordability-among-the-worst-in-the-world\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>[ad_1] Please use the menu below to navigate to any article section: High prices, low supply, and rocketing demand mean Australia\u2019s housing affordability is now among the worst in the world, according to a new report. The 2022 Demographia International Housing Affordability report ranks Sydney in second place for being the least affordable housing market [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":2364,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[153,39,37,38,81],"tags":[],"class_list":["post-2363","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-feature-featured","category-homepage-top","category-latest","category-property-investment","category-weekly-latest"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v27.3) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Australian housing affordability among the worst in the world | Urban Buyer: Buyers Agent &amp; Advocates | Best Property Buyers For You<\/title>\n<meta name=\"description\" content=\"Please use the menu below to navigate to any article section: High prices, low supply, and rocketing demand mean Australia\u2019s housing affordability is now\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/royabhishek.in\/urbanbuyer\/australian-housing-affordability-among-the-worst-in-the-world\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Australian housing affordability among the worst in the world\" \/>\n<meta property=\"og:description\" content=\"Please use the menu below to navigate to any article section: High prices, low supply, and rocketing demand mean Australia\u2019s housing affordability is now\" \/>\n<meta property=\"og:url\" content=\"https:\/\/royabhishek.in\/urbanbuyer\/australian-housing-affordability-among-the-worst-in-the-world\/\" \/>\n<meta property=\"og:site_name\" content=\"Urban Buyer: Buyers Agent &amp; 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