A new survey has found that Hong Kong remains the world's most
unaffordable city for property. Second and third places were taken by
Vancouver and San Francisco, followed by Sydney and Melbourne.
The survey was undertaken by Demographia, which is headed by US-based
urban policy consultant Wendell Cox. Following an approach recommended
by the World Bank and the United Nations, the figures were calculated
using the "Median Multiple," in which the median house price is
divided by the gross annual median household income.
To avoid a housing bubble, the median should not be more than 3.0,
meaning three times gross annual household earnings. However, the
report authors found that Hong Kong has a Median Multiple of 14.9,
which is well into a "severely unaffordable" bracket that begins at
5.1. For Melbourne, the figure is 8.4, for Sydney 9.0, and for London
7.3. Australia overall was also found to be "severely unaffordable,"
at 6.3, while the United Kingdom overall is "seriously unaffordable"
The authors call for urban planning rules to be liberalized. The
survey comes with an introduction by Alain Bertaud, who was Former
Principal Planner at the World Bank, in which he argues that planners
should put "workers' spatial mobility and housing affordability" ahead
of "vague and benign sounding objectives" such as "smart growth,
liveability and sustainability." Environmental issues, Bertaud writes,
are "extremely important, but they should be considered a constraint
to be solved not an end in itself."
In 2012, Hong Kong introduced a 15 percent stamp duty surcharge on
purchases by non-permanent residents, and this and other duty hikes
have succeeded in slowing the rise of property prices in the city. In
November 2013, it was reported that the UK Government may consider
imposing Capital Gains Tax on property sales in Britain by foreign
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