Quote:
Originally Posted by macker
Also watching Australia is very interesting right now as their economy is very similar to ours and the housing situation is also quite similar. The Reserve Bank of Australia cut rates in November and December 2011 and that did nothing to restore confidence to the housing market so they again just recently cut rates by another 50 basis points  . Australias housing market is buckling under the pressure of high household debt. |
Their economy is similar but their housing market is quite a bit more unaffordable than ours. Demographia's study put the Australia national median price to income ratio at 6.7, whereas Canada's national median was 4.5. (major markets over 1 million in population)
For the average CPer at 100k, a 450k house is way more affordable than a 670k house!
Seriously though, the major markets in Australia could have a 32% decline in house prices for them to be equally affordable to Canada, and that's including Vancouver and TO in the Canada number.
Edited to add for local content:
Calgary's multiple was just over the Canadian major market average at 3.9. By comparison, Australia's oil and gas capital of Perth has a score 5.1.
http://www.demographia.com/dhi.pdf