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8Th Annual International Housing Affordability Survey: 2012


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Demographia has a relatively unique way of measuring housing affordability by comparing the price of a median home to the gross (before tax) median annual household income in that market. By dividing the median price by the median income in a given market, Demographia ends up with the median multiple for that market which gives a sense of affordability. Historically, median multiples for the nations in the study have ranged from 2.0 to 3.0 with 3.0 being the upper limit of affordability.

8th Annual International Housing Affordability Survey: 2012

If you look at Table 4 on Page 9 you can see that of the sixteen major real estate markets in the UK (population greater than 1 million people), eight are considered Moderately Unaffordable and another eight are considered Severely Unaffordable as shown here in comparison to the other nations in the study.

Most telling is, that according to Demographia, there are no Major markets (population greater than 1 million people) in the UK that are Affordable or even Moderately Unaffordable, and of all the UK Markets (Page 10, Table 5) not one area is classed as Affordable.

Not really news to us on here, but some interesting statistics when laid bare.

Edited by JimDiGritz
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I can confirm the report is correct with reference to Bournemouth and Dorsett (Dorset) being seriously unaffordable! But now they have made that report, what are they going to do about it?

Here is the table. And it is quite right!

Table ES-2 Housing Affordability Ratings by Nation: Major Markets (Over 1,000,000 Population) Nation Affordable (3.0 & Under) Moderately Unaffordable (3.1-4.0) Seriously Unaffordable (4.1-5.0) Severely Unaffordable (5.1 & Over) Total National Median Australia 0 0 0 5 5 6.7 Canada 0 3 0 3 6 4.5 China (Hong Kong) 0 0 0 1 1 12.6 Ireland 0 1 0 0 1 3.4 New Zealand 0 0 0 1 1 6.4 United Kingdom 0 0 8 8 16 5.0 United States 24 16 5 6 51 3.1 TOTAL 24 20 13 24 81

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We should bear in mind that Dorset (8.7) and Devon (7.4) both have a high proportion of second homes (incomes not counted) which helps explain why they rank so highly on the list. Dorset also has more than its fair share of retired people (with paid off mortgages).

However, as a resident, it's interesting to see Wiltshire (7.0) is more unaffordable than Greater London (6.9). Compared with the prices in neighbouring Berkshire and Hampshire I think it's pretty good value!

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We should bear in mind that Dorset (8.7) and Devon (7.4) both have a high proportion of second homes (incomes not counted) which helps explain why they rank so highly on the list. Dorset also has more than its fair share of retired people (with paid off mortgages).

However, as a resident, it's interesting to see Wiltshire (7.0) is more unaffordable than Greater London (6.9). Compared with the prices in neighbouring Berkshire and Hampshire I think it's pretty good value!

I thought this survey was carried out on the basis of the average working wage in the area in conparison to the average house price?

That would not include those b*stards with second homes clogging up the system for those who live here full time, why dont those kn-b heads just get a hotel if they want to stay here occasionally? (Sorry i went too far with venting my anger for them!!)

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If you look at Table 4 on Page 9 you can see that of the sixteen major real estate markets in the UK (population greater than 1 million people), eight are considered Moderately Unaffordable and another eight are considered Severely Unaffordable as shown here in comparison to the other nations in the study.

Most telling is, that according to Demographia, there are no Major markets (population greater than 1 million people) in the UK that are Affordable or even Moderately Unaffordable, and of all the UK Markets (Page 10, Table 5) not one area is classed as Affordable.

Sorry, dude, but without reading the article, the statements I have highlighted above seem somewhat contradictory.

Nonetheless, it would be interesting to see how many of the markets classied as unaffordable (regardless of how severly so) are also classified by the EU as "deprived areas".

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I thought this survey was carried out on the basis of the average working wage in the area in conparison to the average house price?

That would not include those b*stards with second homes clogging up the system for those who live here full time, why dont those kn-b heads just get a hotel if they want to stay here occasionally? (Sorry i went too far with venting my anger for them!!)

No, I don't think that you did go too far. The survey would include them inasmuch as it will include their large contribution to making houses unaffordable.

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