Australian city world's second most unaffordable, with four others among top 20

Australian cities have dominated a report into the least affordable cities in the world, with one coming in second.

The Demographia International Housing Affordability Report has extensively assessed housing data from 94 major markets across Australia, Canada, China, Ireland, New Zealand, Singapore, United Kingdom and the United States.

Swipe through to see where Australian cities rank in terms of housing unaffordability in the world.

Perth has been ranked as the 20th least affordable city to live in, according to the report.

"All five of Australia's major housing markets have been severely unaffordable since the early 2000s or before," the report said.

Perth was ranked as "severely unaffordable".

The East Coast US city of Boston was also ranked as severely unaffordable.

The most affordable US markets were Pittsburgh, Rochester, St. Louis and Cleveland.

"The current cost-of-living crisis in the United Kingdom has been significantly driven by these house price increases," the report said.

"These increases began at about the same time that the Blair Labour government imposed a planning target for 60 per cent of new housing to be in fill (brownfield development).

"This further market distortion may have contributed to these house price increases, making regulation even more restrictive than under the existing urban containment environment."

Despite being known for its high density, New York City is only the 17th least affordable in the world, likely due to strict rent control laws introduced in the 1970s.

"The middle-class is under siege principally due to the escalation of land costs," the report said.

"As land has been rationed in an effort to curb urban sprawl, the excess of demand over supply has driven prices up."

Pictured is a beach in Bournemouth, which has come in as the 16th least affordable region.

Australia is featured again, with Brisbane also ranked as "severely unaffordable".

The report found Brisbane's median income slowly rose but house prices it wasn't a match for housing growth.

"London is the least affordable market in the United Kingdom, with a median multiple of 8.1," the report said.

Overall the UK had nine severely unaffordable markets and two moderately unaffordable.

Miami is ranked as the 13th least affordable.

The report found housing was generally the most expensive item in the household budget.

"In the United States, where there is the greatest gap between the most expensive and least expensive housing markets, more than 85 per cent of the cost of living difference between the most expensive markets is due to higher housing costs," the report found.

New Zealand's new government has adopted a "Going for Housing Growth" policy based upon the understanding of housing affordability as a land cost problem.

It will seek to ensure there is abundant developable land within and around cities, which they hope will prevent the artificial scarcity that drives up prices.

"This is in contrast to housing affordability policies that are limited to densification strategies," the report said.

Toronto is the second least affordable market in Canada.

The report said there had been a considerable loss of housing affordability in Canada since the mid-2000s.

The United States had five impossibly unaffordable markets, four of which are located in California.

The OECD has warned that without sufficient developable land within urban growth boundaries, housing affordability will deteriorate.

"The housing affordability crisis is fundamentally a land cost issue, driven by the effects of the international planning orthodoxy," it said.

"Even far less renowned Adelaide had an impossibly unaffordable median," the report said.

The range between the most affordable and least affordable markets is growing across Australia.

San Francisco is impossibly unaffordable, according to the report.

"In the United States, the hours of work performed at home are now reported to be four times that of pre-pandemic 2019.

"Indeed, after at least six decades of unsuccessfully seeking to reduce the use of cars in commuting, the latest data shows an unprecedented decline in automobile miles driven from pre-pandemic levels."

Melbourne is now ranked as impossibly unaffordable.

"The middle-class is under siege principally due to the escalation of land costs.

"As land has been rationed in an effort to curb urban sprawl, the excess of demand over supply has driven prices up.

"The net effect is that land values and house prices have become skewed against the middle-class, whose existence depends upon the very competitive land market destroyed by the planning orthodoxy."

Honolulu in Hawaii is the third least affordable market in the US.

Los Angeles is the second least affordable region in the US.

"There was a general improvement in housing affordability in 2023 but not enough to restore the more affordable pre-pandemic situation (2019 and before)," the report said.

"The number of severely unaffordable markets dropped from 52 to 42 (made up of 31 severely unaffordable and 11 impossibly unaffordable), with seriously unaffordable markets increasing from 29 to 37 and moderately unaffordable markets increasing from 13 to 15."

San Jose in California is the least affordable region in the US and the fifth least affordable in the world.

The region was also the least affordable in the US in 2023.

Vancouver has been the first, second or third least affordable major market for each of the last 16 years.

"Troublingly, impossibly unaffordable housing in the Vancouver market has also has spread to smaller BC markets in British Columbia."

Sydney has been ranked as impossibly unaffordable and the second least affordable internationally.

"For decades in the high-income world, a hallmark of a strong middle class was the widespread ability to own a home – house prices generally rose in line with household incomes," the report said.

"Land prices are now much more expensive and house prices relative to household incomes have tripled in markets such as San Francisco, Sydney, Vancouver, Honolulu and Auckland."

Hong Kong has been ranked as impossibly unaffordable and the least affordable in the world.

It has the lowest homeownership rate of 51 per cent, compared to Australia and the US at 66 per cent.

Singapore has the highest homeownership rate of 89 per cent.

"The intensity of the housing affordability crisis suggests that we must reorient current policies on land use and focus on the most fundamental objective: what is good for people," the report said.