Aussie housing affordability far worse than Demographia claims

By Leith van Onselen

The 13th Annual Demographia International Housing Affordability Survey, released on Monday, garnered its fair share of attention for highlighting the woeful state of housing affordability in Australia, especially in the big cities of Sydney and Melbourne.

According to Demographia, the “Median Multiple” (median house price divided by gross annual median household income) in major Australian markets was 6.6, which placed Australia’s housing market as the third most expensive out of the 406 urban markets in nine countries surveyed, with Sydney and Melbourne ranked the second and sixth most expensive housing markets respectively:

ScreenHunter_17050 Jan. 22 17.00

As always, the Demographia survey has garnered a knocker or two, with the long-time defender of Australia’s expensive housing, Stephen Koukoulas (aka “the Kouk”), penning the following on Wednesday afternoon, via The Guardian:

Unfortunately, the Demographia report doesn’t disclose the specific sources for key data and instead relies on vague and untestable assumptions for the numbers that form the basis of their calculations.

Those reporting its findings have universally failed question the numbers underpinning the findings.

I can only speak of the Australian data, but the methodology and data used for calculating affordability in our cities and towns appears to be at best a very rough estimate.

Demographia calculates affordability by dividing the median house price by median household income to get what it calls a “median multiple”.
This is the first shortcoming – there is no mention of interest rates in the calculation…

The next, more important, concern is the Demographia estimate for “median household income”…

The next issue is source of the house price data. It is not clear the source of this information but it is certainly NOT from the Australian Bureau of Statistics. The median house price in Sydney in the September quarter 2016 is $882,000 according to the ABS. It is $1,077,000 according to Demographia, which does not disclose the specific source…

Housing affordability will no doubt be a dominant issue in Australia for some time. It is unhelpful when a factually ambiguous report is used by many to analyse the issue when there has been excellent fact based work on the topic from credible sources.

First, page 69 of the Demographia report lists a bunch of sources used to calculate the “Median Multiple”, so I am not sure what the Kouk is complaining about.

Second, the complaint about not including interest rates in the Median Multiple calculation hardly diminishes the Demographia report. Demographia did not invent the Median Multiple affordability indicator. It, and similar types of price-income indicators, have been used for years by international organisations for international comparisons, such as the OECD, the IMF, and the Harvard Joint Centre for Housing. It seems that only some in Australia find this a problem, which may not be that surprising since Australia has one of the biggest problems.

Moreover, mortgage rates have fallen just as far, if not further, in the other nations surveyed by Demographia. Hence, comparing Median Multiples across nations provides a reasonable estimate of affordability for international comparison purposes.

Common housing affordability measures incorporating mortgage rates also tend to be bunk, for reasons explained here and here.

Third, why on earth would Demographia use the ABS’ unstratified median house price figures? These have not been adjusted for compositional change, hence they are the least accurate measure to use for house prices.

To illustrate, the ABS’ September property price report lists Sydney’s unstratified median price at $882,000 and claims that it fell by 2.1% over the September quarter and by 2.5% over the year. Now compare this to the ABS’ stratified median house price index, which is adjusted for compositional change and is the measure both reported on the ABS website, used by analysts, and quoted in the media. It showed Sydney’s median house price rising by 2.9% over the quarter and by 3.3% over the year.

In any event, I have decided to test the Demographia survey against my own calculations of Australia’s Median Multiples.

For median house price data, I have averaged-out the latest figures from Australia’s four main data providers, namely CoreLogic, APM (Domain), Residex, and the ABS. Each data provider uses different methodologies – CoreLogic (hedonic), APM (stratified median), Residex (repeat sales), and ABS (simple median) – hence giving slightly different results, as illustrated below:

ScreenHunter_17129 Jan. 27 07.36

For median income, I have used the ABS’ latest capital city gross median household disposable income data, which is available as at June 2014:

ScreenHunter_17130 Jan. 27 07.40

I have then adjusted these figures upwards by the ABS’ quarterly labour price index, to give the following:

ScreenHunter_17132 Jan. 27 07.43

It is worth noting that median household incomes are likely overstated in the above table, since actual average weekly earnings have grown more slowly than the labour price index, due to such things as the rotation into lower paying services jobs and the relative reduction in full-time employment.

Nevertheless, combining the above estimates of median house prices with median household incomes gives the following median multiples for Australia:

ScreenHunter_17133 Jan. 27 07.48

And these are similar to those calculated by Demographia, at least across the major capitals:

ScreenHunter_17134 Jan. 27 07.49

One clear shortfall of the Demographia survey is that it does not weight each city relative to the sample size. Thus, it ascribes the same weighting to Hobart as it does to Sydney and Melbourne, which obviously biases down the Median Multiple for Australia as a whole. This approach is likely taken for simplicity – applying weightings across 406 urban markets would be a nightmare!

Therefore, in the below chart I have applied weightings to Demographia’s Australian capital city Median Multiples, which gives a Median Multiple for Australia of 8.7:

ScreenHunter_17135 Jan. 27 07.54

Despite the Kouk’s pedantry, the Demographia survey appears to give a fair assessment of housing affordability for Australia. If anything, the survey’s main shortfall is that it understates Australia’s housing affordability problem.

[email protected]

Unconventional Economist


  1. Someone made the point, the other day, that the 19th and or 20th century is an aberration for civilised democratic society. In that the normal states are feudalism, war, slave labour etc.

    Something like that. Apologies to the writer.

    Maybe we are reverting to that, via the globalised oligarchy, financialised housing, phoney derivatives stock market and Fiat debt printed money base.

    “Life wasn’t meant to be easy” – especially if you don’t make stuff and value barista’s.

  2. Demographia uses pre-tax income for some reason. Hong Kong has a very low income tax rate (17% is the top of the progressive scale, or 15% flat) which might put Sydney in number 1 spot if you worked off post-tax income (can’t see any reason why you wouldn’t other than simplicity).

    • As long as there is at least one significant part of the property market that can work on a pre-tax basis ( negative gearing, in effect) then looking at post tax become difficult. If it was uniform across ALL participants, then yes…..

      • “Affordability” should be as it applies to an owner occupier, its a bit meaningless when applied to investments.

        Also Kouk goes on to complain that interest rates aren’t included in the equation. In Hong Kong, mortgage rates are around 2%.

    • Good points Dan
      “Affordability” is a term that has become so corrupted by Koukolas and his FIRE mates it is now close to useless
      By his definition all we have to do to solve the housing “affordability ” problem is cut teh rates
      Which is no doubt what will occur just like it has for the last 3yrs

  3. The Kouk is looking forward to further rate cuts by the RBA (and facilitated by APRA supervision of the external liabilities of the Australian private banks) so that Australians can ‘afford’ even higher house prices.

    See – if we can ‘afford’ even higher house prices by using even more debt – local or foreign – we are getting richer.

    The worst bit is that there is large audience for Kouk nonsense in the ALP and an even bigger audience in the LNP.

    All part of the craziness when you build a public monetary system around the lending decisions of private banks.

  4. What is with ABS, seems totally out of line with other data providers. They also claim the housing component of CPI is currently a mere 0.3%. In the next CPI survey they are moving to a model where house prices will be modeled off its component costs (e.g. x% the cost of treated pine + y% the cost of cement etc) who in their right mind thinks a consumer pays for houses on this basis?

  5. … What Hugh Pavletich wrote early 2011 for the Sydney Morning Herald and the Melbourne The Age …

    Report: housing affordability out of sync with incomes – Domain

    Feb 2, 2011
    Hugh Pavletich

    On a global basis, homes in Australia are expensive.

    Late January every year for the past seven years, the annual Demographia International Housing Affordability Survey is released.

    The survey this year covers, as usual, the major cities of the English-speaking world and, for the first time, Hong Kong.

    It is based on what is termed the ”median multiple”, where the median house price is divided by the gross annual median household income for each city.

    Without fail, the survey sets off a chorus of criticism from the usual interests within the political, financial and property sectors of Australia, calling it simplistic, inadequate, wrong and, for good measure, ideologically driven. … read more via hyperlink above …

    ‘Denials of a housing crisis are now simply lies’ … comment … Shamubeel Eaqub | Radio New Zealand News'denials-of-a-housing-crisis-are-now-simply-lies

    Opinion – Every government policy to make housing affordable since the early 1990s has been a failure, and it’s time the political classes actually delivered on their responsibilities, writes Shamubeel Eaqub.

    Housing in Auckland is extremely unaffordable.

    The latest Demographia International Housing Survey confirmed what we know – house prices in Auckland have risen much faster than incomes. So much so, that Auckland is the fourth least affordable city in a survey of 92 cities around the world. … read more via hyperlink above …

    Demographia in the news …

  6. An interesting look at measures of housing affordability:

    “This analysis shows that median multiple is very poor tool not only to estimate home affordability (especially for first home buyers) or compare change in affordability over time, but also for comparing housing affordability between various cities around the world. Even more importantly this analysis shows that home affordability is non-existent for all first home buyers who make under median income and many who make even more than median.”

    • That is a very reasonable analysis and is exactly what I have been saying for years. That is, the median multiple measure understates the problem, if anything. As that analysis points out, there is a far better spread of prices in median multiple 3 cities, matching up homes with people of all income levels. When the median multiple is 6+ the price distribution is also altered because of the way the market is distorted.

      The way I have been arguing this, is that when the median multiple is 3, the bottom quintile multiple is also likely to be close to 3. When the median multiple is 8, the bottom quintile multiple is likely to be around 14.

      The graphs in that analysis, clearly show Australian cities house price distributions to be skewed to the high side, with no “low price” tail in the data.

  7. reusachtigeMEMBER

    Housing in Australia IS NOT expensive. It is exactly what people are willing and able to pay. It’s called a “free market” you ulta-commie bstards!!!!

    • ” It is exactly what people are willing and able to pay. ”

      Its exactly what good-looking people are able to pay and enough to keep the ugly ones out. Not a bad thing that.

      • We should try this with bread and milk too. See how much people will pay when forced to by rigging the market.

    • Yes, Reusa… there’s a price for outer suburbs working poor.

      A price for inner city wealthy. And a price for investors.

      Leaving a price for weekly rent for the rest.

      It’s all in equilibrium.

      Except investors are government endorsed (tax breaks NG, CGT). Mum and dads Owner Occupied, are also government endorsed (child care, and other welfare assistance).

      When the govt picks winners via tax benefits and redistribution, you get distortion.

      But the prices are set based on available funds.

  8. Well its all about to end i’m afraid. I have decided to sell. For me that is the leading indicator of an impending crash. I reckon I have about 3 weeks work on bathrooms, and then the day I list it the whole market will crash. Last time I tried, the market crashed in between the time I decided to sell and the painter finished painting the whole thing.

    Be warned, its now inevitable!!!

    • Interesting HFW. I am superstitious and do believe some people have the “knack”. Could you please elaborate on the “last time i tried, the market crash” story? And, when do you plan to sell the current one? Are you a flipper by any chance?

      • I cant exactly remember the dates, I was somewhere around July 2011 to December 2012. No i’m not a flipper, it is our family home. It is at the top end of the market, and at that time sales in our area and in our price range dropped by 80% on the previous year. So much so that we had the property on the market for about 60% of what we paid for it, and still got no calls. It wasn’t just us either, very few properties actually sold in the time we had it on the market.

    • The next crash happens the day after I buy. so you are safe, then the second crash happens when I try to sell… 3 times so far been unable to sell at anything like the market price at the time, this at different times over 30 years

  9. Daylight Robbery

    “For median house price data, I have averaged-out the latest figures from Australia’s four main data providers”

    What about units? Or does Demographia only measure houses for each country?

  10. wasabinatorMEMBER

    I can’t believe that Melbourne’s median price is that “low” based on the number of million plus suburbs here now. Even houses way out of time are surging up to that level.

  11. NEW ZEALAND: House prices continue to drive home unaffordability | Massey University | Scoop News

    … extract …

    … “This was highlighted by the annual Demographia International Housing Affordability Survey released earlier this week, which placed Auckland as the world’s fourth least affordable city.

    “When you look at the national figures, New Zealand’s house price to annual wages ratio shows a slight deterioration to 8.7, but the figures for Auckland and Central Otago Lakes are 13.6 and 12.6 respectively.

    “While median house prices in Central Otago Lakes have shown a slight decrease over the most recent quarter, over the past 12 months the region has shown the country’s largest decline in affordability of 11 per cent.” … read more via hyperlink above …

  12. Lismore house prices ‘severely unaffordable’ | Northern Star

    Alison Paterson | 27th Jan 2017 5:56 AM

    LISMORE’S housing market has been classified as “severely unaffordable” according to an international survey of housing affordability.

    The 13th Annual Demographia International Housing Affordability Survey 2017 was released this week and it ranked Lismore as one of 33 out of a total of 54 housing markets in Australia

    The report classified affordable housing as three times a buyer’s average income.

    It found Lismore’s median house price of $335,000 and a median household income of $52,500, results in the cost of a home 6.4 times higher than local buyers’ median annual earnings.

    This puts Lismore statistically less affordable than New York, Tokyo, Dublin or Singapore.

    Wayne Matthew, the spokesman for Demographia Australia, said any rating above three was unaffordable.

    “We have seen a massive range of unaffordable housing across the country because the state governments generally have a massive influence over the price of land and they are hooked on the revenue from its sale,” he said. … read more via hyperlink above …

    Demographia Australia

  13. I read a comment somewhere talking about how Sydney is probably the most expensive in the world since “Sydney” in this survey includes far flung suburbs while Hong Kong is measuring the equivalent of inner Sydney.

    Is there any merit to this statement?



    Years ago I re-wrote the Mission Statement of the New Zealand National Party …

    ‘The mission of the New Zealand National Party is to tip-toe through life … quietly … hoping to reach death … safely.’

    … and this mid-2015 …

    Labour support on city limits (abolition) welcomed … Nick Smith

    … and the massive consensus … across the board … refer …

    … and still NO ACTION from the Minister of Hyperventilation (formally Housing … which he lost prior to Christmas ) …

  15. Negative gearing in spotlight as Liberal MPs push for shift in policy –

    Malcolm Turnbull has shot down calls from some of his Liberal backbenchers to consider changes to negative gearing in a bid to tackle the housing affordability crisis.

    Several Liberals including Sydney MP John Alexander are urging the Turnbull government to rethink its opposition to reining in negative gearing ahead of the May budget. … read more via hyperlink above …

  16. Why for Australia, and especially for a city like Sydney, do Demographia only consider DETACHED houses? A significant proportion (half?) of dwellings in Sydney are flats/apartments. I bet the figures for London for example do not only include detached houses?

  17. The ‘Median multiple’ was invested by my friend the late great Steve Mayo at the World Bank, and subsequently supported by USAID and UN-HABITAT. It was originally my job to collect it in cities worldwide, 1994-6. It was always the best of the original Housing Indicators, because it targeted land shortages and bad housing and planning policy rather than a way that even the dimmest politician could understand

    • Joe … Many thanks indeed for your comments.

      My understanding is that post WW11 following the Levitts creation of the production house building industry, the ‘cultural standard’ if you like was that housing should not cost any more than 3 times gross annual household income, requiring mortgage loads of about 2.5 times.

      You guys such as the late great Steve Mayo, Solly Angel, you and others did a grand job getting this critically important measure inculcated in to the World Bank and United Nations Urban Indicators Programmes. I do wish you academics would blow the dust off these ‘hidden’ programmes … so they are better known and understood in the public arena.

      The first I learnt of these programmes (don’t laugh) was out of an article in the Shanghai Daily some years ago (around 2007 as I recall) … and that’s when I contacted Prof Solly Angel at the Stern School, New York University.

      The Demographia Surveys were created late 2004 when I teamed up with Wendell Cox.


      … which concluded in suggesting getting the Median Multiple inculcated in to local government culture as the PRIMARY INDICATOR … with a number of SUPPORTING INDICATORS AS WELL.

      The economics profession, and other involved with land use, needs to re-introduce (we are not inventing anything here) these ‘market language measures’ in to the public conversation as well.

      Note within the New Zealand Section of this year’s Demographia Housing Survey … specifically Figure 10. Page 26 the ‘consents rate per 1000 population per annum’ graph showing the bureaucratically bloated / buggered Christchurch City Council on the one hand … and the (combined in this graph) two smaller and functional local government units of Waimakariri and Selwyn on the other.

      No wonder the New Zealand Herald / Businessdesk / National Business Review article header is …

      Christchurch bucks trend in Demographia housing affordability survey – Business – NZ Herald News

      … and too … this August 2016 The Press article …

      Rolleston (Selwyn County): Time to take it seriously |

      During November, the Ministry of Business, Innovation and Employment (MBIE … formally Department of Commerce) came out with an important 2 page Regional Report, illustrating the compound annual employment growth 2005 – 2015 for Christchurch (population 367,800) was a woeful 0.3%, Waimakariri (population 56,400) 5.3% and Selwyn (population 52,700) a staggering 9.8% … nationally just 1.4% .

      If all local authorities performed like Waimakariri and Selwyn, we likely would not have a housing affordability crisis in New Zealand.

      Local authority size, structure and culture are the critical factors.

      There are two types of local government in this world … the small and the bad.

      • Thankyou Hugh. With Steve gone, the message lacked a champion, and then UN-HABITAT dropped the indicators in 2002, just when they were really needed. Demographia did a fantastic job picking up the baton – and your strategy was better than ours, instead of the ‘diagnostic housing market kit’ Steve and Solly originally envisaged – you took the one indicator and thumped away at it till people were forced to listen.

        I’m in a position once again where I have the chance to influence housing policy, at least in the developing world.I’m about to change the message we have been delivering for 30 years. You wont like parts of it (for instance we are encouraging countries to take a look at a German-style rental system) but much of it you will applaud.

        Also – I think it’s about time we tried to find a voice in Australia, since at last the message ‘high house prices bad not good’ is starting to get through thick skulls. .

      • Joe … Many thanks for your follow-up comments.

        In New Zealand we are past the winning hearts and mind stage ( or … driven them right up the wall … depending on ones perspective ! ) .. and are now focused on getting workable solutions in place.

        It is hugely heartening in just how many good people there are out there now actually getting in there sorting out the implementation stuff.

        Just check out my archival website … specifically the ‘2016’ and ‘…The Growing Consensus …’ sections … to get a sense of the depth of the consensus in New Zealand.

        Australia is a different story.

        There have been many ‘false starts’ in getting on the path of dealing with these issues over the decades.

        The major problem is that we have STILL not seen grounded and hard-hitting advocacy ( the problem is political … so the language must be as well ) emerge at the States level.

        It really is a States / Local Government issue.

        It is very important too, that the changes are from the bottom up … not the top down.

        I do hope that with the release of this year’s Demographia Housing Survey … and the great media engagement with this ( I can’t speak highly enough of the engaged and responsible New Zealand media across the board … they are outstanding people ) … that good people in Australia are discussing getting States based effective advocacy underway.

        They are always most welcome to communicate with me. Contact info is on my archival website Performance Urban Planning.

  18. Best Cities for Middle-Income Households: The Demographia Housing Affordability Survey – Center for Opportunity Urbanism

    by Wendell Cox

    The 13th Annual Demographia International Housing Affordability Survey measures middle-income housing affordability in 92 major housing markets (metropolitan areas with more than 1,000,000 population) in Australia, Canada, China (Hong Kong ), Ireland, Japan, New Zealand, Singapore, the United Kingdom and the United States. These include five of the largest metropolitan areas in the high income world, the megacities of Tokyo-Yokohama, New York, Osaka-Kobe-Kyoto, Los Angeles, and London, all with more than 10 million population. … read more via hyperlink above …

    Dr Oliver Hartwich discusses the Demographia Housing Affordability Survey | The New Zealand Initiative

    … access further reports …

  19. DEMOGRAPHIA at Brian Ripley’s Canadian Housing Price Charts & Plunge-O-Meter –

    13th Annual Demographia Ranking
    of Canada’s 6 Biggest Metros 3Q 2016

    Thanks to Hugh Pavletich and Wendell Cox co-authors of the Demographia International Housing Affordability Survey. This chart shows that Vancouver BC continues to rank as the least affordable city out of the 40 largest Canadian cities with a multiple of 11.8 times median household income required to buy a median priced house. As of Q3 2016 the 6 cities ranked from least to more affordable are: Vancouver 11.8, Toronto 7.7, Montreal 4.8, Calgary 4.6, Edmonton 4.1 and Ottawa 3.9. All 40 Demographia ranked cities in Canada are TABLED BELOW. … read more via hyperlink above …

  20. Sydney’s housing market second most expensive in the world | Daily Mail Online

    … extract …

    … The survey compares major housing markets based on the ‘median multiple,’ a figure that is derived by dividing median house prices by median household incomes.

    Sydney scored a median multiple of 12.2, which means that a household would need to pool its gross annual income for 12 years to pay for a home up-front.

    Demographia considers a score of three or less affordable; anything over five is rated ‘severely unaffordable.’

    ‘These are lunatic figures, there’s no other way to describe it,’ Mr Pavletich told Daily Mail Australia.

    He went on to call Sydney’s housing market ‘a crisis situation.’ …

    … While state residents wait to see if the new premier can offer solutions, Mr Pavletich had one piece of advice for young families trying to start a life in Sydney: ‘Keep renting.’

    ‘Young people just want to avoid committing themselves to artificial bubble prices. They’re going to be faced with a life sentence of having to pay back excessive housing costs.’ … read more via hyperlink above …

    ‘Severely unaffordable’: Sydney’s housing nightmare laid bare in new survey | Shanghai Daily

    … extract …

    … Sydneysiders paying ‘four times’ too much

    The report’s co-author, Hugh Pavletich, described Sydney’s housing issue as “remarkable”.

    “Sydney is after Hong Kong, which is sitting at 18 times household earnings, as the second worst in the world so it’s just remarkable with so much land that Australia has got that it should have this problem,” he said.

    “Sydney house prices are about 12.2 times annual household incomes which is grossly excessive.

    “What housing should be in normal markets is at or below three times household earnings, so Sydney is four times what it should be.”

    Mr Pavletich said decentralisation was also an issue. Of the 7.7 million people who call NSW home, more than 4.8 million live in the greater Sydney area.

    “There is not enough decentralisation in Australia. State and local governments have lost the control of their costs and their capacity to finance infrastructure properly,” he said. … read more via hyperlink above …

  21. Sydney housing affordability not on residents’ minds, federal minister Paul Fletcher says – ABC News (Australian Broadcasting Corporation)

    … extract …

    Increasing supply a top priority for Berejiklian

    Premier Berejiklian has made it clear she believed an increase in supply could be the most effective way to combat rising house prices.

    She revealed she had already spoken to Prime Minister Malcolm Turnbull about housing affordability.

    “I can appreciate why my colleagues at a Federal level aren’t getting into the specifics of a debate,” she said.

    “What what has been shown previously is that if you make decisions without consideration in relation to housing, you can unintentionally create more heat in the market, which puts upward pressure on prices.”

  22. 2017 13th Annual Demographia International Housing Affordability Survey … Kiwiblog

    The full report is here ( website & media release ). It looks at median house prices as a multiple of median incomes in 406 cities in nine countries. … read more via hyperlink above …

    ‘Denials of a housing crisis are now simply lies’ … comment … Shamubeel Eaqub | Radio New Zealand News'denials-of-a-housing-crisis-are-now-simply-lies

    Opinion – Every government policy to make housing affordable since the early 1990s has been a failure, and it’s time the political classes actually delivered on their responsibilities, writes Shamubeel Eaqub.

    Housing in Auckland is extremely unaffordable.

    The latest Demographia International Housing Survey confirmed what we know – house prices in Auckland have risen much faster than incomes. So much so, that Auckland is the fourth least affordable city in a survey of 92 cities around the world. … read more via hyperlink above …

    Demographia in the news …

  23. Posted at … … and … … comments on threads welcome …

    Aussie seniors the forgotten victims of housing affordability crisis | Starts at 60

    Not all Baby Boomers are reaping the rewards of rocketing property prices. In fact, plenty are doing it very tough. Are you one of them?

    The Baby Boomers who’re accidental millionaires thanks to the soaring value of their family home are regulars in the news.

    But older Aussies are also the group most at risk from the slump in housing affordability in many cities, experts tell Starts at 60.

    Professor Peter Phibbs, a housing specialist at the University of Sydney, says the stratospheric cost of buying housing has helped push up rental costs, leaving many renters on the Age Pension “doing it tough” because they have no way of increasing their income to cover rising costs. … read more via hyperlink above …


    Rodney Hide on John Key’s no principle government
    by Cameron Slater on January 29, 2017 at 9:30am

    John Key governed for himself. There were only three things he wanted after becoming Prime Minister, he wanted four terms, to beat Sir Keith Holyoake as National’s longest serving Prime Minister and a knighthood.

    Really, he was that shallow. … read more via hyperlink above …

  25. Median house price to income ratio much higher than Demographia suggests. – Australia: Boom to Bust Blog

    By Lindsay David

    I found it interesting going through Demographia’s annual housing affordability survey. Which I must say is always well worth the read and does provide great insight on house price to income ratio’s in cities and towns across primarily the English speaking world.

    And once again it showed how insanely ridiculous house prices in Australia are– not only in the sum paid for a house, but also relative to what we earn.

    One thing that struck me year after year was how the median house price across each country is measured. Demographia suggests that Australia’s median (market) house price is 5.6x household income. Yet over at LF Economics we have calculated the house price to income ratio to be 8.4x (& 6.6x for units). … read more via hyperlink above …