Latest news with #WendellCox
Yahoo
26-05-2025
- Business
- Yahoo
The death of the family home is killing the American middle class
Once renowned for widespread homeownership, the key Anglosphere countries are reverting to a feudal past, where land is owned by increasingly few. In every major market in Canada and Australia, and in much of America and the UK, house prices have skyrocketed to record levels, with corresponding consequences for home ownership rates. In a new report, demographer Wendell Cox traces this to the failure to build enough new housing units, particularly the single-family homes that consumers most desire. In the United States, homebuilders built about one million fewer homes (including rental units) in 2024 than in 1972 when there were 130 million fewer Americans. One estimate puts the US housing market short by about 4.5 million homes. But the housing crisis is a global phenomenon that hits the middle and working classes hardest. In large part due to high housing prices, notes the 'OECD in Under Pressure: The Squeezed Middle-Class', the middle-class faces ever rising costs relative to incomes, so much so that its very survival is threatened. 'The cost of essential parts of the middle-class lifestyle have increased faster than inflation,' it notes. Housing prices have been rising 'three times faster than household median income over the last two decades.' Even in prosperous and communitarian Switzerland, Zurich studios sell for well over $1 million, and small houses for considerably more than that. Even affluent people cannot afford down payments, despite the overwhelming financial advantages to homeowners. This housing shortfall and high prices are seen throughout the Anglosphere. Australia's historically high rates of homeownership have all but collapsed among those aged between 25 and 34 years old, plummeting from more than 60 per cent in 1981 to only 45 per cent in 2016. The proportion of owner-occupied housing has dropped by 10 per cent in the last 25 years. In the United Kingdom in 2022-23, 39 per cent of 25-34 year-olds owned their home, compared to 57 per cent of the same age cohort in 1995. A rising proportion of British millennials are likely to remain renters for life. Similarly, US millennials were already less likely in 2015 to be homeowners than baby boomers and Gen-Xers. By 2021, home ownership among those aged 25-34 had dropped from 45.4 per cent in 2000 to 41.6 per cent. Record numbers of first-time buyers are stuck on the sidelines as housing affordability stands at the lowest level for which there are data series, while one in three pay over 30 per cent of their income in mortgage or rent. Across the board, Wendell Cox's new report lays the blame for this situation on the British-born idea of urban containment, with its roots in the UK's 1947 Town and Country Planning Act. This policy sought to steer development towards higher density core cities and away from the lower density periphery, forcing people into 'living smaller, living closer' – whether they like it or not. The results have been dreadful. As early as the 1970s, British planner Peter Hall suggested that the 'speculative value' of land with planning permission in the UK was five to 10 times higher than that of land without planning permission. Virtually all the most expensive markets in Cox's new affordability study – outside number one Hong Kong – operate some form of urban containment, including such cities as Vancouver, Sydney, Melbourne, Adelaide, San Francisco, Los Angeles, San Diego and, of course, London. All these areas now have prices that are nine times or more higher than median incomes, which is also three times the historic rate. Many of the markets closer to that historic norm – in Texas, the South and the Midwest US – do not have such policies. Nor does focusing on higher density lower prices, as is sometimes argued. In fact, US data suggests a positive correlation between greater density and housing costs. Among 53 major metros, those with more single-family housing and larger lot sizes (key indicators of lower density) have substantially better housing affordability. One recent study found that the median family in San Jose would need 125 years (150 in Los Angeles) to save a down payment; in Atlanta or Houston the figure is 12 years. Perhaps most damning, these policies are clearly not effective in creating more housing; Portland, a US pioneer in urban containment, embraces high density housing but high prices have driven multi-family construction to the lowest level in a decade. In California, which has experienced similar stagnation, notes a recent RAND study, policy-driven delays, strict architectural standards, green mandates and the requirement to pay union-level wages have pushed the cost of construction of subsidised apartments twice as high as in Texas. How do we begin to solve this problem? It should not be too difficult, once urban containment and other policies are effectively scrapped. With relatively low population growth – particularly outside the migrant population – there is no huge spike in fundamental demand as occurred, for example, in the 1950s and 1960s. The rise of remote work, migration to smaller urban areas, as well as new technologies for building, including the use of 3D printers, actually offer the chance to build more affordable housing. The bad news is that this crisis is largely self-inflicted. The good news is that it can be solved, if our political class can find the will to change and jettison policies that have led to this disastrous situation. Joel Kotkin is presidential fellow in urban futures at Chapman University and senior research fellow at the Civitas Institute at the University of Texas Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Telegraph
26-05-2025
- Business
- Telegraph
The death of the family home is killing the American middle class
Once renowned for widespread homeownership, the key Anglosphere countries are reverting to a feudal past, where land is owned by increasingly few. In every major market in Canada and Australia, and in much of America and the UK, house prices have skyrocketed to record levels, with corresponding consequences for home ownership rates. In a new report, demographer Wendell Cox traces this to the failure to build enough new housing units, particularly the single-family homes that consumers most desire. In the United States, homebuilders built about one million fewer homes (including rental units) in 2024 than in 1972 when there were 130 million fewer Americans. One estimate puts the US housing market short by about 4.5 million homes. But the housing crisis is a global phenomenon that hits the middle and working classes hardest. In large part due to high housing prices, notes the 'OECD in Under Pressure: The Squeezed Middle-Class', the middle-class faces ever rising costs relative to incomes, so much so that its very survival is threatened. 'The cost of essential parts of the middle-class lifestyle have increased faster than inflation,' it notes. Housing prices have been rising 'three times faster than household median income over the last two decades.' Even in prosperous and communitarian Switzerland, Zurich studios sell for well over $1 million, and small houses for considerably more than that. Even affluent people cannot afford down payments, despite the overwhelming financial advantages to homeowners. This housing shortfall and high prices are seen throughout the Anglosphere. Australia's historically high rates of homeownership have all but collapsed among those aged between 25 and 34 years old, plummeting from more than 60 per cent in 1981 to only 45 per cent in 2016. The proportion of owner-occupied housing has dropped by 10 per cent in the last 25 years. In the United Kingdom in 2022-23, 39 per cent of 25-34 year-olds owned their home, compared to 57 per cent of the same age cohort in 1995. A rising proportion of British millennials are likely to remain renters for life. Similarly, US millennials were already less likely in 2015 to be homeowners than baby boomers and Gen-Xers. By 2021, home ownership among those aged 25-34 had dropped from 45.4 per cent in 2000 to 41.6 per cent. Record numbers of first-time buyers are stuck on the sidelines as housing affordability stands at the lowest level for which there are data series, while one in three pay over 30 per cent of their income in mortgage or rent. Across the board, Wendell Cox's new report lays the blame for this situation on the British-born idea of urban containment, with its roots in the UK's 1947 Town and Country Planning Act. This policy sought to steer development towards higher density core cities and away from the lower density periphery, forcing people into 'living smaller, living closer' – whether they like it or not. The results have been dreadful. As early as the 1970s, British planner Peter Hall suggested that the 'speculative value' of land with planning permission in the UK was five to 10 times higher than that of land without planning permission. Virtually all the most expensive markets in Cox's new affordability study – outside number one Hong Kong – operate some form of urban containment, including such cities as Vancouver, Sydney, Melbourne, Adelaide, San Francisco, Los Angeles, San Diego and, of course, London. All these areas now have prices that are nine times or more higher than median incomes, which is also three times the historic rate. Many of the markets closer to that historic norm – in Texas, the South and the Midwest US – do not have such policies. Nor does focusing on higher density lower prices, as is sometimes argued. In fact, US data suggests a positive correlation between greater density and housing costs. Among 53 major metros, those with more single-family housing and larger lot sizes (key indicators of lower density) have substantially better housing affordability. One recent study found that the median family in San Jose would need 125 years (150 in Los Angeles) to save a down payment; in Atlanta or Houston the figure is 12 years. Perhaps most damning, these policies are clearly not effective in creating more housing; Portland, a US pioneer in urban containment, embraces high density housing but high prices have driven multi-family construction to the lowest level in a decade. In California, which has experienced similar stagnation, notes a recent RAND study, policy-driven delays, strict architectural standards, green mandates and the requirement to pay union-level wages have pushed the cost of construction of subsidised apartments twice as high as in Texas. How do we begin to solve this problem? It should not be too difficult, once urban containment and other policies are effectively scrapped. With relatively low population growth – particularly outside the migrant population – there is no huge spike in fundamental demand as occurred, for example, in the 1950s and 1960s. The rise of remote work, migration to smaller urban areas, as well as new technologies for building, including the use of 3D printers, actually offer the chance to build more affordable housing. The bad news is that this crisis is largely self-inflicted. The good news is that it can be solved, if our political class can find the will to change and jettison policies that have led to this disastrous situation.
Daily Mail
18-05-2025
- Business
- Daily Mail
Insane global ranking that says it all about buying a home in Australia
Five Australian cities have been included in the list of the top 15 most unaffordable places in the world to buy a home. The 2025 Demographia International Housing Affordability report, released this week, revealed Sydney, Melbourne, Brisbane, Adelaide, and Perth were among the most expensive locations. Sydney was named the second most unaffordable city overall, second only to Hong Kong. Adelaide ranked sixth, Melbourne ninth, Brisbane 11th, and Perth 14th. While Perth was rated 'severely unaffordable,' the other four capitals were classified as 'impossibly unaffordable'. 'It is remarkable that these markets are less affordable than widely recognised world cities like New York, London, or Chicago,' the report stated. The annual report, published by Chapman University's Centre for Demographics and Policy, compares median house prices with median household incomes across 95 major housing markets in Australia, New Zealand, the UK, the US, Canada, China, Ireland and Singapore. Report principal Wendell Cox said Sydney had consistently remained among the least affordable housing markets globally. 'Sydney had the first, second or third least affordable housing of any major market in 16 of the last 17 years,' he wrote. 'Even the smallest Australian market, Adelaide, endures an impossibly unaffordable median multiple of 10.9, ranked 90th among the 95 markets. 'It is remarkable that these markets are less affordable than widely recognised world cities like New York, London, or Chicago.' The report found middle-income home ownership, once widespread in developed countries, had significantly declined as prices surged ahead of household earnings since the 1990s. Researchers looked to understand why the some markets were so hot. 'Among high-income nations, middle-income homeownership was once widespread, with house prices aligned with incomes,' the report read. 'Since the 1990s, however, prices have surged—especially in markets governed by urban containment strategies early (e.g., San Francisco, Sydney, London) —with homes now costing 9–15 times household income.' Centre director Joel Kotkin attributed the trend to restrictive planning and land-use policies. 'The Demographia report has shown that where such policies predominate, for example in the UK, California, Washington, Oregon, Colorado, New Zealand, Australia and much of Canada, the results are disastrous, at least for potential homebuyers,' Mr Kotkin said. Researchers pointed to 'urban containment' strategies – including greenbelts, zoning restrictions and growth boundaries – as key drivers of unaffordability, particularly when such policies limit housing expansion on the urban fringe. 'Nearly all severely unaffordable housing markets follow the urban containment model,' Mr Cox said. 'The resulting land scarcity inflates prices, particularly near urban growth boundaries.' The report found that in markets such as San Francisco, Sydney and London, median house prices had reached between nine and 15 times the median household income. Land value was identified as the most significant cost in these areas, with prices spiking around areas where development was allowed near formerly restricted zones. The researchers also questioned whether building high-density housing in existing urban areas actually improved affordability. They warned that if such housing remained too expensive or unattractive to most middle-income earners, the underlying issue would stay unresolved.
Toronto Star
17-05-2025
- Business
- Toronto Star
Chapman University Releases International Housing Affordability Report Revealing None of the 95 Major Markets Affordable
ORANGE, Calif., May 14, 2025 (GLOBE NEWSWIRE) — For the first time in the report's 21-year history, none of the 95 major housing markets analyzed across eight nations qualifies as 'affordable.' This alarming statistic headlines the newly released 2025 edition of Demographia International Housing Affordability, authored by Wendell Cox and published by Chapman University's Center for Demographics and Policy in partnership with The Frontier Centre for Public Policy. The annual report provides housing affordability ratings for the third quarter of 2024 in Australia, Canada, China (Hong Kong), Ireland, New Zealand, Singapore, the United Kingdom and the United States, offering a comprehensive and timely analysis of global housing market conditions.
Ottawa Citizen
14-05-2025
- Business
- Ottawa Citizen
Chapman University Releases International Housing Affordability Report Revealing None of the 95 Major Markets Affordable
Article content Article content ORANGE, Calif., May 14, 2025 (GLOBE NEWSWIRE) — For the first time in the report's 21-year history, none of the 95 major housing markets analyzed across eight nations qualifies as 'affordable.' This alarming statistic headlines the newly released 2025 edition of Demographia International Housing Affordability, authored by Wendell Cox and published by Chapman University's Center for Demographics and Policy in partnership with The Frontier Centre for Public Policy. Article content Article content The annual report provides housing affordability ratings for the third quarter of 2024 in Australia, Canada, China (Hong Kong), Ireland, New Zealand, Singapore, the United Kingdom and the United States, offering a comprehensive and timely analysis of global housing market conditions. Article content Joel Kotkin, director of the Center for Demographics and Policy at Chapman University, commented, 'Middle-income homeownership is increasingly out of reach in major urban centers. The consequences for generational equity, upward mobility, and regional economies are profound. Unless bold reforms are made, especially around land use and urban planning, we risk further deepening inequality and economic stagnation. That's why we're proud to continue this vital partnership with Canada's Frontier Centre for Public Policy.' Article content The rankings in the report are based on a measure called the median multiple, which compares the median house prices in a market to the median household income. In other words, it answers the question, How many years of income would it take for a typical household to buy a typical home? For example, if the median home costs $300,000 and the pre-tax median household income is $75,000, the median multiple is 4.0. Markets are then rated on a scale ranging from 'affordable' (3.0 or less) to 'impossibly unaffordable' (9.0 or more). The higher the number, the harder it is for the middle-income households to afford homeownership. Article content Article content Top 10 Most Affordable Markets (All rated 'Moderately Unaffordable') Article content 1. Pittsburgh, PA (USA) – 3.2 2. Cleveland, OH (USA) – 3.3 3. St. Louis, MO-IL (USA) – 3.5 4. Rochester, NY (USA) – 3.6 5. Edmonton, AB (Canada) – 3.7 Middlesbrough & Durham (UK) – 3.7 Oklahoma City, OK (USA) – 3.7 Omaha, NE-IA (USA) – 3.7 9. Sheffield (UK) – 3.8 10. Cincinnati, OH-KY-IN (USA) – 3.9 Article content Top 10 Least Affordable Markets (All rated 'Impossibly Unaffordable') Article content 1. Hong Kong (China) – 14.4 2. Sydney (Australia) – 13.8 3. San Jose, CA (USA) – 12.1 4. Vancouver, BC (Canada) – 11.8 5. Los Angeles, CA (USA) – 11.2 6. Adelaide (Australia) – 10.9 7. Honolulu, HI (USA) – 10.8 8. San Francisco, CA (USA) – 10.0 9. Melbourne (Australia) – 9.7 10. San Diego, CA (USA) – 9.5
