The housing market in major cities around the world has become increasingly unaffordable, with cities in the US, Australia, and Hong Kong leading the way. In the US, cities such as San Jose, Los Angeles, San Francisco, and San Diego are among the most expensive places to buy a home. Honolulu in Hawaii also ranks high on the list of unaffordable cities. In Australia, Sydney, Melbourne, and Adelaide are the most unaffordable cities for home buyers.
Hong Kong tops the global leaderboard as the least affordable city worldwide, known for its high rents and tiny apartments. Despite its unaffordability, there has been a slight improvement in home prices due to the COVID-19 pandemic and government policies. Hong Kong has the lowest home ownership rate among the cities surveyed, at just 51%, compared to Singapore where the rate is over 89% due to the government’s public housing initiatives.
The report attributes the soaring house prices to a price-to-income ratio and land use policies such as urban containment to limit urban sprawl. Working from home during the pandemic has led to a demand shock for houses outside city centers with more outdoor space, further driving up prices. The report suggests looking to New Zealand as an example of freeing up more land for development to address the affordability crisis.
Cities like Vancouver and Toronto in Canada are also facing affordability issues, with policies like “Going for Housing Growth” in New Zealand being proposed as a solution to provide more housing options. The report also highlights the most affordable cities globally, including Pittsburgh, Rochester, and St. Louis in the US; Edmonton and Calgary in Canada; and Blackpool, Glasgow, Perth, and Brisbane in Australia. This report was compiled by researchers from Chapman University in California and the Frontier Centre for Public Policy in Canada.
