The Melbourne housing market was ranked at 321st place out of a 325 markets in the world in terms of housing affordability reports the Demographia International Housing Affordability Survey.

Overall, the survey found that homes in Australia were the least affordable compared to five other English-speaking countries while Hong Kong ranked as the most expensive market in relation to average incomes. The Melbourne market was ranked by the survey as "severely unaffordable." After Melbourne, Sydney came in at second place as the least affordable place to buy a house in the world at 324th place.

The survey also reported that average prices for houses in Melbourne were at $565,000 although median household income only came in at $63,100. In stark comparison, properties in the United States were found to be the most affordably priced at only 3.3 times average earnings.

The Demographia International report said that Australia had changed from “the exemplar of modestly priced, high-quality middle class housing, to now the most unaffordable housing market in the English speaking world.”

“Each of the least affordable markets were characterized by more restrictive land use regulation, which materially increases the price of land and makes housing less affordable.”

Hong Kong was at the bottom of the rankings at 325th place with average house prices worth 11.4 gross annual median household income. Housing prices in Hong Kong have been skyrocketing because of the influx of investment from the mainland.

The survey compared market prices found in Australia, Canada, Ireland, New Zealand, United Kingdom, United States and Hong Kong.

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