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ISCOVER
Staff Reporter
Homes in Australia remain among the most unaffordable in the developed world.
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According to a new report by Demographia, the nation's houses are “vastly overpriced”.
Of the 39 housing markets analysed within Australia, all were rated as “seriously” or “severely” unaffordable, based on median house price to annual household income ratios of more than four times.
According to the report, anything below an average house price to average pre-tax income ratio of three times is regarded as “unaffordable”.
“Overwhelming economic evidence indicates that urban containment policies, especially urban growth boundaries, raise the 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 read.
“The higher costs ripple into rental markets, tightening the budgets of lower income households [which] already suffer from lower discretionary incomes.”
