By Hilary Whiteman | CNN
Anyone who has followed the event of the actual estate market even somewhat over the past twenty years knows that in lots of countries, not least within the United States, it has grow to be way more difficult to purchase a house.
But a brand new report sums up the sentiments of many potential homebuyers by making a category that labels some major cities as “impossibly unaffordable.”
The report compared average incomes with average home prices and located that pandemic-related demand for homes with outdoor amenities, zoning regulations limiting sprawl and investors flooding into the market had driven up prices.
According to the annual Demographic International Housing Affordability Report, which has tracked real estate prices for twenty years, U.S. cities on the West Coast and Hawaii account for five of the ten most costly places.
Perhaps not surprisingly, the costliest U.S. cities to purchase a house are in California, with San Jose, Los Angeles, San Francisco and San Diego all making the highest 10.
The Hawaiian capital Honolulu can also be ranked sixth amongst 94 wholesale markets examined in eight countries.
Australia is the one country aside from the United States to top the list of “impossibly unaffordable,” led by Sydney and the southern cities of Melbourne in Victoria and Adelaide in South Australia.
At the highest of the worldwide rankings, nevertheless, is Hong Kong, the compact Asian financial center known for its tiny apartments and astronomical rents. It is notably the one Chinese Market covered within the report.
Hong Kong frequently features within the rankings of the costliest cities and has the bottom home ownership rate of all of the cities studied at just 51%. In Asian rival Singapore, the house ownership rate is over 89% because of the federal government's decades-long commitment to social housing.
Hong Kong could be the city with the bottom affordability on this planet, but prospective homebuyers could also be encouraged to know that prices should not as high as they once were.
Real estate prices plummeted throughout the 2020 pandemic, when the federal government closed the town's borders and imposed a zero-Covid policy – along with latest national security laws that had a chilling effect on the town.
Why so high?
It attributes the rise in home working throughout the pandemic to a “demand shock” for homes outside city centers which have more outdoor space. But it also blames rising property prices on land-use policies, including “urban containment,” a variety of planning designed to forestall urban sprawl.
“The middle class is under threat primarily because land prices have soared. As land has been rationed to curb urban sprawl, excess demand over supply has driven up prices,” the report said.
Prices continued to rise as investors entered the market searching for profits.
One solution, in accordance with the writer of the report, is to look to New Zealand.
In an opinion piece for Canada's Financial PostWendell Cox, Senior Fellow at Frontier Center for Public PolicyIn particular, he called for Canada to follow New Zealand's example and release more land for immediate development.
Both Vancouver and Toronto made it onto the list of cities which might be “impossibly unaffordable.”
Cox points to the “Going for Housing Growth” concept introduced by New Zealand’s coalition government, which requires local authorities to right away establish 30-year housing growth zones.
“Toronto and Vancouver show that the costs of containing expansion are unacceptably high: inflated property prices, higher rents and poverty for ever more people,” Cox wrote.
For those that can't wait for a change in policy or a decline in demand, the report also identifies probably the most inexpensive cities of the 94 cities studied worldwide.
These are Pittsburgh, Rochester and St. Louis within the USA, Edmonton and Calgary in Canada, Blackpool, Lancashire and Glasgow within the UK and Perth and Brisbane in Australia.
The report was compiled by researchers on the Center for Demographics and Policy at Chapman University in California and the Frontier Centre for Public Policy, an independent public policy think tank in Canada.
Top 10 “Impossibly Unaffordable” Cities
- Hong Kong
- Sydney
- Vancouver
- Saint Joseph
- The angel
- Honolulu
- Melbourne
- San Francisco/Adelaide
- San Diego
- Toronto
The-CNN-Wire
™ & © 2024 Cable News Network, Inc., a Warner Bros. Discovery company. All rights reserved.
image credit : www.mercurynews.com