According to an international survey, Vancouver is the second least affordable major housing market in the world.
The 16th annual Demographia International Housing Affordability Survey looked at 92 major housing markets around the world, and ranked them based on middle-income housing affordability. It covered 309 metropolitan housing markets in eight countries including: Australia, Canada, China [Hong Kong only], Ireland, New Zealand, Singapore, the United Kingdom and the United States.
The survey determined the middle-income housing affordability ranking by using the “median multiple” — the median house price divided by the median household income.
The study notes that Hong Kong is the least affordable housing market, with a median multiple of 20.8. Last year, the densely populated metropolis had a median multiple of 20.9.
Following Hong Kong, Vancouver is the second least affordable major housing market, with a median multiple of 11.9.
Sydney ranks third least affordable at 11.0, followed by Melbourne at 9.5 and Los Angeles at 9.0. Toronto and Auckland are tied for sixth least affordable at a median multiple of 8.6.
San Jose has a Median Multiple of 8.5 and San Francisco 8.4. London (Greater London Authority) has a Median Multiple of 8.2, which made it the 10th least affordable major market.
Top five least affordable major housing markets:
- Hong Kong
- Los Angeles
The report’s authors noted that "because eligibility for housing subsidies is based on the inability to afford market rate housing, higher house prices increase the cost of subsidized housing programs and increase the number of households that are eligible." They propose that the most effective way to reduce the shortage of subsidized housing is to improve middle-income housing affordability.
The study also highlights how the "middle class is under threat." As a result, adult children aren't likely to have higher incomes than their parents, at least in the United States, the United Kingdom, Canada, Australia, New Zealand, Ireland and elsewhere.