A new survey names Limerick city the most affordable place in the world to buy a home, closely followed by Waterford city in joint second place.
The 12th Annual Demographia International Housing Affordability Survey placed the Irish cities in the top two spots out of 367 cities throughout nine countries by measuring the city’s mean household income against median house prices.
In Limerick, a median household income lies at $56,138 (€51,200) while median house prices are currently $101,750 (€92,800). This means that a typical person in the city will have to spend just 1.8 times their income if investing in a home.
Waterford, which came in joint second place alongside Decatur, Illinois; Topeka, Kansas; and Elmira, New York, sees the average person also spending just 2.1 times their income on a home. Median income in the city is currently $52,300 (€47,700) while their median house price lies at $109,645 (€100,000).
Ireland as a whole fared well in the housing affordability survey although the United States was deemed to have the most affordable major metropolitan markets with 75 affordable cities.
Ireland was the most affordable of the nine countries surveyed, however, coming in with a median income multiple of 2.8 in order to purchase a home. This is the third year in a row that Ireland has topped the housing affordability rating and between 2004 and 2015, Ireland has had no severely unaffordable major metropolitan markets.
A negative for Ireland’s rating came in the form of capital city Dublin, however, which ranked much further down the list.
Lying in the middle third in 128th place, the typical person would need 4.5 times their income to purchase a home in Dublin, way above the 3.5 income multiple introduced by the Central Bank in Ireland last year as a requirement for acquiring a mortgage.
Based on figures from the Central Statistics Office in Ireland, Dublin’s average house price is $288,366 (€263,000) with a median household income of $64,690 (€59,000).
This makes Dublin a “seriously unaffordable area,” ranking it with the likes of Las Vegas and Tokyo.Cork was the only other city in Ireland not rated as “affordable.”
Despite Dublin’s disappointing ranking, the survey till spells good news for the increasing number of Americans hoping to purchase property in Ireland.
Almost one in six overseas inquiries about Irish property now comes from the US, a percentage buoyed by the current strong dollar. A survey by the Real Estate Alliance (REA) recently showed that inquires from the US increased from almost zero to 16 percent in 2015.
The Irish-based REA will be hosting an exhibition in New York this March featuring thousands of Irish properties with the hope of matching these inquiries with an new Irish home.
This year’s affordability survey placed Hong Kong at the bottom of the pile as the most unaffordable city in the world in which to buy a home. Nineteen times the median income is typically needed there with the median house price currently placed at a staggering $5.6m.
In second place as the least affordable city came Sydney, Australia, requiring 12.2 times the median income ($84,600) to purchase a home, followed by Vancouver (10.8 times) and San Jose, California (9.7 times).
The survey was completed by Demographia, rating middle-income housing affordability in Australia, Canada, China (Hong Kong), Ireland, Japan, New Zealand, Singapore, United Kingdom, United States.