Despite falls, Aussie housing still amongst world's most expensive

24 Jan 2019

Despite falls, Aussie housing still amongst world's most expensive

Regional markets not exempt.

Australia has retained its status as one of the least affordable countries in the world according to the most recent Demographia International Housing Affordability Survey. 

Leading community housing provider Compass Housing Services said the results showed the need for urgent government action on housing.

The Demographia survey measures housing affordability by comparing median prices with median household incomes.  All five of Australia’s major housing markets (population >1 million) were in the “severely unaffordable” category and, despite recent price falls, Sydney and Melbourne maintained their positions as among the most unaffordable housing markets in the world.

Most expensive major markets (pop > 1million)

Rank

Country

City

Median Multiple

1

China

Hong Kong

20.9

2

Canada

Vancouver

12.6

3

Australia

Sydney

11.7

4

Australia

Melbourne

9.7

5

USA

San Jose

9.4

6

USA

Los Angeles

9.2

7

NZ

Auckland

9.0

8

USA

San Francisco

8.8

9

USA

Honolulu

8.6

10

UK

London

8.3

14

Australia

Adelaide

6.9

18

Australia

Brisbane

6.3

21

Australia

Perth

5.7

Source: Demographia 2019

 

 
However Compass Housing’s Manager of Public Affairs Martin Kennedy said it wasn’t just major markets where affordability was an issue.

“The survey’s findings are consistent with those of the Compass Housing Affordable Housing Income Gap Report, which last year found housing stress was not restricted to capital cities and was not only experienced by low income households,” he said.

Of the 23 Australian cities and towns included in the Demographia report, only Gladstone, with a median multiple of 2.9, is deemed to be affordable.  

Rockhampton, with a median multiple of 3.8 is deemed “moderately unaffordable”, while Albury-Wodonga, Alice Springs, Darwin, Mackay and Townsville are “seriously unaffordable” with median multiples between 4.1 and 5.0.

The remaining 16 markets are all deemed “severely unaffordable”.  Remarkably, both the Gold Coast and Sunshine Coast have median multiples higher than London.

Mr Kennedy said the findings prove that although prices have begun to decline in some areas, they remain out of reach for median income households.

 “Prices might be falling at the moment, but the reality is in some areas it would take a fall of 50% or more just to get back into the ‘moderately unaffordable’ category,” he said.

“The broader economic consequences of such an outcome, if it came to pass, would be severe and could result in even higher levels of housing stress”.

The most recent Productivity Commission report found more than 50% of low-income households in the private rental market were already experiencing housing stress.

There are five simple things governments can do to fix Australia's housing system so that it works for everyone. 

  • Reset our tax system to make it fairer for ordinary Australians wanting to buy a home.
  • Appoint a minister for housing & develop a strategy to deliver 500,000 social and affordable homes.
  • Improve renters’ rights by getting rid of “no grounds” evictions and unfair rent increases.
  • Increase Commonwealth Rent Assistance for the thousands of families who are struggling to pay the rent.
  • Develop a National Plan to end homelessness by 2030.

 
Find out more at: www.everybodyshome.com.au

ENDS

Media contact: Martin Kennedy 0418 353 913 / martink@compasshousing.org