Auckland has 4th Most Expensive Housing Market

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Wednesday, January 27th, 2016
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A new survey ranks Auckland as the fourth-least affordable place in the world to buy a house.

In the latest Demographia Housing Affordability survey released on Monday, the city jumped from ninth to equal fourth in the global rankings in the year to sit alongside Melbourne and San Jose.

Auckland has a median house price of $NZ738,700 ($A686,400) while median income is $NZ77,500 giving it a house price-wage multiple of 9.7.

Economist Shamubeel Equab has spoken repeatedly of an emerging “Generation Rent” – young people who cannot afford to buy property and are faced with renting their entire lives.

It’s the reality for most in Auckland, he says, unless they have high paying professional jobs, or well-off parents willing to give them a hand – fitting with his theory of a new landed gentry.

“It’s really strange because we’ve never been like that.”

He sees the solution as well-planned higher density housing, which would cater to Auckland’s need to grow.

“People think of density as this horrible thing, but my vision of Auckland is one more storey across Auckland.”

However, with political and planning decisions being driven by older, property-owning Aucklanders, change is hard to come by, he said.

“There is a whole bunch of angst in terms of the home-owning elite who are essentially just being really pig-headed and, completely understandably, want to protect what’s theirs and what is there now.”

By blocking change, the policy-makers are shutting their own children and grandchildren out of the Auckland housing market, he said.

“If we can reinstate the idea that a house is actually for people to live in and that it’s a basic human right rather than a luxury, then we know what kind of policy we have to implement to get it right.”

Those leaving Auckland for the provinces were mainly in the 35-45 age bracket, with middle management skills, looking for a cheaper cost of living.

But even for those with well-paying jobs, it was getting harder to afford a house, he said.

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