A major new study of housing affordability ranks Winnipeg and Edmonton as among the most affordable markets in the world. The 2nd Annual Demographia International Housing Affordability Survey, assembled by Wendell Cox, a consultant and associate researcher at the Frontier Centre for Public Policy, and Hugh Pavletich, a property investment manager in New Zealand, identifies over-regulation of land supply as the chief reason why markets become inaccessible to purchasers.
Winnipeg scored close to the top, second in rank when the affordability index is adjusted to reflect the size of housing space available for the same price compared to other cities, with Edmonton not far behind. A booming Calgary came in at “moderately unaffordable,” with Toronto classified as “seriously unaffordable” and Vancouver as “severely unaffordable.” Smaller markets in Regina and Saskatoon were not included.
The survey “provides a guide and readily understood measure, for communities themselves to work together in exploring solutions to this serious issue,” says Pavletich. “Good quality and abundant housing can only happen from a foundation of good quality governance and communities that care.”
Cox and Pavletich use a measurement tool called a “Median Multiple,” which identifies the median household income and the median house price of individual urban areas and expresses affordability by the number of year’s median household income it would take to purchase the median-priced house.
The entire survey, available at http://www.demographia.com/dhi-ix2005q3.pdf, includes housing markets in Canada, the United States, the United Kingdom, Ireland, Australia and New Zealand.