In extreme and yet somehow unsurprising news, Sydney has reached 6th place worldwide for unaffordability of housing. It currently sits behind only Hong Kong, San Francisco, Singapore, Vancouver and Tel Aviv.
The report, by the Committee for Sydney think-tank, compared median incomes to both property and rental prices in major cities around the world.
In the past 12 months, rental prices have risen by 28% for apartments and 13% for houses. Over the past decade, the overall rental price increase in the harbour city is 40%.
This has put 35% of Sydney’s renters in housing stress. Housing stress is typically defined as spending more than 30% of one’s income on rent.
For property purchases, the median income is now 13.3 times less than the median property price. That is up from 8.3 a decade ago.
We know how rental and mortgage prices affect us individually. But what about the collective impacts?
“They include,” the Committee for Sydney says, “businesses paying an additional ‘wage premium’ to encourage employees to stay working in the city; longer commute times and worsened congestion; reduced innovation and risk-taking; and out-migration of young, working age talent.”
The report’s key recommendations: invest in much more social and affordable housing and significantly increase housing supply.
If we get it right, big cities can be a great thing. Economic data suggests every 1% increase in a city’s population increases productivity up to 1.8%.
But it’s making that size livable for everyone the community relies upon that is the city’s latest challenge.
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