For many, homeownership is a cornerstone of the American dream. But that dream is turning into a nightmare in an increasing number of cities. A new report identifies the top 10 metropolises where soaring housing prices have made buying a home nearly impossible for the average person.
Hong Kong snags the dubious honor of the least affordable housing market in the world, according to the report. But North America isn’t far behind, with five US cities cracking the top 10:
- San Jose, California: The heart of Silicon Valley suffers from a tech boom-fueled housing crisis.
- Los Angeles, California: From Hollywood glamour to astronomical housing costs, LA’s dream comes with a hefty price tag.
- Honolulu, Hawaii: Paradise isn’t cheap, especially when it comes to putting a roof over your head.
- San Francisco, California: Another Bay Area city grappling with a severe lack of affordable housing options.
- San Diego, California: America’s Finest City might have a sunshine tax on housing affordability.
The report uses a “median multiple” score to rank these cities. This metric compares median home prices to median incomes, highlighting the stark contrast between what people earn and what they need to spend on housing.
The high cost of living isn’t limited to the US. Sydney, Vancouver, Melbourne, and Adelaide in Australia also made the list, indicating a global trend of housing affordability becoming increasingly out of reach.
The factors driving this trend are complex, including limited housing supply, pandemic-induced demand shifts, and increased investor activity. This confluence of issues is pushing homeownership out of reach for many, particularly middle-income earners.
So, what’s the solution? Experts point to a multi-pronged approach that includes increasing housing inventory, addressing restrictive zoning regulations, and exploring measures to cool down frothy real estate markets.
For now, the dream of homeownership remains just that for many in these top 10 cities. The question is, will policymakers be able to bridge the widening gap between income and housing costs, or will the dream continue to be crushed under the weight of unaffordability?
