Why choosing where you live will change your financial outcome. I have always said that money vs lifestyle is a decision. To live in Sydney and Melbourne comes with great advantages and disadvantages. Lifestyle in these cities is amazing, but the percentage of income required to service the loans is very high. As per the quote below.

Report author Wendell Cox said “there has been an unprecedented deterioration in housing affordability during the pandemic,” with the number of severely unaffordable markets rising 60% in 2021 compared to 2019.

To rate middle-income housing affordability, Demographia International Housing Affordability used the “median multiple” – a price-to-income ratio, which is the median house price divided by the gross median household income.

“The least affordable market is Hong Kong, with a median multiple of 23.2, followed by Sydney at 15.3, Vancouver at 13.3, San Jose at 12.6 and Melbourne at 12.1,” the report said. “The most affordable market is Pittsburgh, at 2.7, followed by Oklahoma City and Rochester at 3.3, with Edmonton and St. Louis at 3.6.”

The report, which compared incomes to home prices in the third quarter of 2021, was released by the Urban Reform Institute and the Frontier Centre for Public Policy.

On the upside it could be worse, aka Hong Kong. I am not saying lets all move to St. Louis, but I can see the rationale of moving there. Paying your home off quickly and enjoying a debt free existence sooner. I myself chose to buy in Adelaide using similar thought process. I can see the ocean and its a nice area that is well serviced etc. If I was in a comparable suburb/property in Sydney it would be 4x the price, maybe more. I personally can’t justify it. What are your thoughts on this ?

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