Aussie homes are the least affordable in the world: Survey

Melbourne, Jan 21 : A global survey has revealed that homes in Australia are the least affordable in the world.

It was also found that regional cities in Australia including Mandurah outside Perth and Queensland's Sunshine Coast are among the most expensive places on Earth.

Mandurah, a commuter town 74km south of Perth, was ranked 6th in a list of the world's least affordable cities, and the Sunshine Coast, a favourite holiday destination of Kevin Rudd, was ranked 7th.

In the international survey, Sydney was ranked the 11th least affordable city.

It was found that the least affordable place to live in the world is Los Angeles, but since Australia has the most cities, it is the least affordable country for housing.

"Australia (with New Zealand) has the most unaffordable housing in the surveyed nations," News.com.au quoted Wendell Cox, economist and report author, as saying.

"There are no affordable markets in Australia and there are no moderately unaffordable markets. Twenty-five of the 28markets are rated severely unaffordable.

"All of the large capital cities (Sydney, Perth, Melbourne, Brisbane and Adelaide) are rated severely unaffordable. The best ratings are seriously unaffordable in three smaller markets, Maitland (NSW), Ballarat and Bendigo (both in Victoria)," Cox added.

London is the 18th least affordable city followed by Perth, which was ranked 19th and West Australian city, Rockingham, a holiday destination 47km south of Perth, which was ranked 24th.

"It's not just the big cities. This study confirms that affordability is also a problem in areas including Mandurah, the Sunshine Coast and the Gold Coast," Peter Verwer, Property Council of Australia chief executive, said.

"It's important with these new cities that we don't make the same mistakes, which is put a ring around and them and say: no more development beyond here. That just makes prices rise.

"Australia's dismal performance highlights the need to reverse the policies that created today's artificially inflated house prices.

"On average, Australian families are forced to spend 6.1 times their entire household income to buy a typical home compared to 3.1 times in Canada and 3.6times in the US, and that's before interest charges.

"In Sydney, the multiple is 8.6 and Melbourne is 7.3, but it's even higher in some of Australia's fastest-growing cities, including Mandurah, (9.5), Sunshine Coast (9.3) and the Gold Coast (8.6)," he added.

The survey of 227 cities is published in the 2008 Demographia study of international housing affordability.

ANI