Friday, January 25, 2013

Australian Household Unaffordability

Hard to fathom that even though Australia is booming related to the majority of countries, we are still one of the most unaffordable housing markets in the world. Out of one recent study we were ranked 3rd after Hong Kong and Canada out of 337 cities (Demographia, Wendell Cox, 2013)

Affordability was determined by dividing median house price with the median household gross annual income before tax. Credit Rating, Agency Fitch says we are the least affordable in the world but says things are improving.

We now spend 32% of our household income on our mortgage repayments compared to 44% in 2008. To draw a comparison, in America it is about 16% and in the UK about 17%.