Auckland continues to be one of the most unaffordable cities
in the world to buy a home, with an international study
ranking London, New York and Los Angeles more affordable.
The ninth Annual Demographia International Housing
Affordability Survey has found housing in New Zealand has
become slightly more unaffordable in the last year, with
median house prices now 5.3 times the median income (median
multiple), up from 5.2.
All eight of New Zealand's property markets were "seriously"
or "severely" unaffordable.
Auckland continues to be the least affordable market, with a
median multiple of 6.7, followed by Christchurch (6.6),
Tauranga-Western Bay of Plenty (5.9), Wellington (5.4) and
Dunedin (5.1) all severely unaffordable.
Palmerston North (4.4), Napier-Hastings (4.5) and Hamilton
(4.7) are all ranked as seriously unaffordable.
Houses are now nearly 80 per cent more expensive than the
historic affordability housing norm of 3 times the median
income, which was last experienced in the 1990s.
The affordability report, authored by Wendell Cox and Hugh
Pavletich, points to urban containment policies, especially
urban growth boundaries, as being responsible for the rising
price of housing relative to income.
"This inevitably leads to a reduced standard of living and
increases poverty rates because the unnecessarily higher
costs of housing leave households with less discretionary
income to spend on other goods and services," the report
"The higher costs ripple into rental markets, tightening the
budgets of lower income households, who already suffer from
lower discretionary incomes."
The annual affordability report says Hong Kong, China is the
most unaffordable place to buy a house, with a median
multiple of 13.5.
Auckland is more affordable than Australian cities Sydney
(8.3) and Melbourne (7.5), but less affordable than Adelaide
(6.5), Perth (5.9) and Brisbane (5.8).
Affordability around the world
Housing market, median multiple
Hong Kong, China, 13.5
Sydney, Australia, 8.3
Melbourne, Australia, 7.5
Auckland, New Zealand, 6.7
Adelaide, Australia, 6.5
New York, US, 6.2
Los Angeles, US, 6.2
Perth, Australia, 5.9
Brisbane, Australia, 5.8
London, United Kingdom, 5.1
Dublin, Ireland, 3.6
Source: Annual Demographia International Housing
(Median multiple represents the median house price divided by
the median income)
- Kieran Campbell of APNZ