Auckland houses less affordable than New York

[muppet]

Auckland houses less affordable than New York

By Anne Gibson
5:30 AM Monday Jan 24, 2011
Low incomes put buying a home out of the reach of many. Photo / APN


New Zealand houses are among the world's most expensive when incomes are taken into account - and Auckland and Tauranga homes are less affordable than those in New York, says a major survey released today.
Low incomes and high house prices are leaving Kiwis badly off and preventing many from climbing onto the housing ladder.
The seventh annual Demographia International Housing Affordability Survey of 325 cities and regions has given us the thumbs down, putting New Zealand alongside Australia, Britain, the United States, Canada and Ireland as among the world's worst housing markets.
Four of the eight New Zealand markets surveyed - Auckland, Tauranga, Christchurch and Wellington - were classed "severely unaffordable". The other four - Hamilton, Napier-Hastings, Palmerston North, and Dunedin - were "seriously unaffordable".
Despite three years of a depressed economy, housing remains out of many Kiwis' reach. The situation has worsened because house prices fell only marginally yet job security lessened and wage rises dried up. ..........



Read more at

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10701626

[SwissKiwi]

NY NY is very different to NY State - which is being used for these stats?

[Perry]

It's all about diminishing wages and/or the
same for the purchasing power of what's
actually being received, 'in the hand.'
.

[SwissKiwi]

"the wider New York/New Jersey/Pennsylvania area on 6.1"

I'm not sure this is 'apples with apples'

[Jumpin]

That is such a silly report.

[ChrisD]

Having read the report, the methodology and conclusions appear sound to me.

[cube]

I love the proposed solution:

Survey co-author Hugh Pavletich, of Christchurch, called for more land to be made available for housing.

"The Government needs to recognise the importance of dealing with the housing supply issues with urgency, so that New Zealand is more affordable and competitive than Australia. This will encourage young New Zealanders to stay in their own country and contribute to its development.

Oh, and who is Hugh Pavletich?

Hugh Pavletich is a Christchurch New Zealand based commercial property
developer, former President of the South Island Division of the Property Council, Fellow of the Urban Development Institute of Australia and co-author of the Annual Demographia International Housing Affordability Survey.

[CJ]

As Perry points out, the issue is our low wages.

Given the number of property developers gong bankrupt, I am not sure you can bring down the cost of housing much (except in the compliance cost area).

[muppet]

Then if all the people who work on building a new house were paid higher wages and all the people who produce things for new houses were paid higher wages, the cost of new houses would sky rocket

[asdr]

"the wider New York/New Jersey/Pennsylvania area on 6.1"

I'm not sure this is 'apples with apples'

Direct link to the Demographia survey report is here so you don't have to view the awful website design. The New York survey is for the "23 counties in three states in the New York metropolitan area" (map on Wikipedia). As such it seems fairly comparable to Greater Auckland, as though it's a much larger area it has similar population density (1100 vs 1250 people per square km).

[ChrisD]

Then if all the people who work on building a new house were paid higher wages and all the people who produce things for new houses were paid higher wages, the cost of new houses would sky rocket

If you read the study you would realise that it's the cost of land, not building, that's driving unaffordability. On an inflation-adjusted basis the cost of building hasn't moved a lot over the last few decades compared with the cost of land.

[eri]

and as mentioned in the article muppet posted in the oz section

“Land price appreciation is a key cause of Australia’s housing affordability problem, with higher prices cascading through the residential market to push up the price of both new & existing houses.”

He said Australia’s expensive land prices were due to a failure of policies at all levels of government to achieve a timely supply of land for residential development.

RPdata.com senior research analyst Cameron Kusher said the escalating cost of land was not only impacting the affordability of new homes but also that of existing housing: “When the median price of a block of land in Sydney is $A269,000 it’s easy to see why affordability is spiralling out of control. When you add - on top of the land cost - professional fees, government charges and the actual cost of constructing a home, it’s no surprise that many Australian’s are forced to remain in the rental market, paying off others’ mortgages.

[imd6662]

um.. well.. it's not just land availability is it? We've actually got lots of land.

It's where it is.

[Perry]

And which Council it is, too.
.

[67910241]

"the wider New York/New Jersey/Pennsylvania area on 6.1"

I'm not sure this is 'apples with apples'

Using that logic they'd have to include Hamilton in wider Auckland stats.