The 3rd Annual Demographia International Housing Affordability Survey 2007 ranks Honolulu number 3 in the world for the most unaffordable housing market in urban locations.

Honolulu is listed only behind Los Angeles and San Diego and is deemed “severely unaffordable.” San Francisco and Ventura County, CA, rank number 4 and 5 respectively.

See the full report here:

http://www.demographia.com/dhi-ix2005q3.pdf

Here is a section of the report, with an overview of the findings of the study:

”Home Ownership: The Social and Economic Imperatives”

Home ownership has been a principal objective of public policy in all of the surveyed
nations. Each nation has increased its home ownership rates markedly since World War II.
There has been a strong association between expanded home ownership and improved affluence — what can be called the democratization of prosperity. This better quality of life appears
to be threatened across the spectrum, from lower income households that will no longer be able to
afford home ownership to middle income households, who will be able to afford only more modest
houses. The unprecedented decoupling of house prices from incomes could lead to significantly
reduced home ownership rates in the decades to come.

”The High Cost of Decoupling House Prices from Incomes”

The housing affordability crisis is of recent origin, principally over the past five to 10 years.

Median Multiples of 4.0 or more were rare before the 1990s. Median Multiples of double the
affordability standard — 6.0 and above were virtually unheard of. Yet, today, the Median

Multiple exceeds 8.0 in a number of markets and is more than 10 in some. In Australia there has
been a marked loss of affordability over the past 10 years. In the United States, two distinctively
different market classifications have developed. The most unaffordable markets have has a doubling
of house costs relative to incomes.

Ten years ago these markets were nearly as affordable as today

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