Owning a home: it's an 8-year bitch

Sydney was rated "severely unaffordable" in the third annual Demographia survey by the US-based property analyst Wendell Cox Consultancy, and ranked as the seventh most unaffordable city in the world.

Even the citizens of greater London and New York found it easier to fulfil their dream of owning a house in their home towns, the survey found. Los Angeles was the most out of reach, followed by several other cities on the US west coast.

"The most pervasive housing affordability crisis is in Australia," says the survey, based on data for the three months to September 2006. It says "house price inflation is costing years in additional gross income for purchasing households in the most unaffordable markets".

The lobby group Save Our Suburbs said that, based on the median house price, Sydney was going backwards. "In time the fact that new generations will not be able to afford a family home will be bitterly resented," said the group's president, Tony Recsei.

The Demographia report calls for the governments presiding over communities with expensive housing to speed up the land approval system, bypass the system of land releases and apply a "presumption favouring development except where reasonable environmental standards would be contravened".

The NSW Minister for Planning, Frank Sartor, dismissed the report as that of a "remote hired gun" and quoted its co-author Wendell Cox as telling Alan Jones on 2GB last year: "We need to begin pulling off the regulations, releasing considerable land, taking off these crazy master-planned requirements. You can't build a master-planned community in Sydney without having a child-care facility. The fact is the whole of the western suburbs of Sydney in the 1960s and '70s didn't have this master-planned stuff. There is nothing wrong with how Sydney developed in the '60s and '70s."

Mr Sartor said: "That's where the problems of Sydney came from." He defined the problems as "inadequate infrastructure" and pressure on public transport.

The former Reserve Bank governor Ian Macfarlane said last August: "I think it is pretty apparent now that reluctance to release new land, plus the new approach whereby the purchaser has to pay for all the services upfront - the sewerage, the roads, the footpaths - has enormously increased the price of the new entry-level home. That is a supply-side issue, not a demand-side issue."

The Opposition planning spokesman, Chris Hartcher, said on average there were $160,000 in government charges on a new block of land. He called for more public-private partnerships to reduce upfront costs such as water and sewerage.

1 Los Angeles, California

2 San Diego, California

3 Honolulu, Hawaii

4. San Francisco, California

5 Ventura, California

6 Stockton, California

7 Sydney

8 San Jose, California

9 London, Britain

10 Bournemouth, Britain

18 New York

23 Melbourne

Source: US Based Wendell Cox Consultancy

http://www.smh.com.au/news/national/owning-a-home-its-an-8year-bitch/2007/01/22/1169330827946.html