Median multiple

The median multiple is used to indicate the affordability of housing in any given community.[1] The median multiple is widely used for evaluating urban markets, and has been recommended by the World Bank.[2][3]

The median multiple is the ratio of the median house price by the median gross (before tax) annual household income. This measure has historically hovered around a value of 3 or less, but in recent years has risen dramatically, especially in markets with severe public policy constraints on land and development.[4]

Table

The International Housing Affordability Survey uses the following table to determine affordability ratings:[5]

Rating Median multiple
Severely unaffordable 5.1 and over
Seriously unaffordable 4.1 to 5.0
Moderately unaffordable 3.1 to 4.0
Affordable 3.0 and under

See also

References
  1. "Real Estate Bubbles and the "Median Multiple Index"". Ted's Blog. Retrieved 2016-02-13.
  2. "The Housing Indicators Program". World Bank. Retrieved 13 February 2016.
  3. Angel, Shlomo (2000-10-20). Housing Policy Matters: A Global Analysis. Oxford University Press, USA. ISBN 9780195350326.
  4. "10th Annual Demographia International Housing Affordability Survey: 2014" (PDF). Retrieved 13 February 2016.
  5. "12th Annual Demographia International Housing Affordability Survey: 2016" (PDF). Retrieved 13 February 2016.
This article is issued from Wikipedia. The text is licensed under Creative Commons - Attribution - Sharealike. Additional terms may apply for the media files.