Housing Affordability Monitor
Affordability is usually reported as a price series. It is more usefully read as a quantity series. This monitor tracks both, alongside the public investment decisions that sit behind the supply side of the gap.
Sources: UN-Habitat, World Cities Report 2026, chapter 3; Visual Capitalist, home prices vs incomes, from UN-Habitat 2026. Coverage is more than 180 economies. National medians conceal very large metropolitan variation, which is why the United States looks affordable here and does not in San Jose.
Source: UN-Habitat, World Cities Report 2026, chapter 3. The deficit widened by 68 million units in thirteen years, a period during which real interest rates were low for most of the interval.
Source: UN-Habitat, World Cities Report 2026, chapter 3, citing OECD data. A fall of roughly two thirds, concentrated in the period after the global financial crisis.
Source: Statista, house price to income ratio, OECD countries, from the OECD housing price database. Portugal, Canada and the Netherlands each exceeded 130 index points in 2024. The bar labelled highest three is the 130 threshold those countries cleared, not their exact level.
Why the gap does not respond to monetary easing
| Driver | Mechanism | Why it resists rate cuts | Source link |
|---|---|---|---|
| Construction costs | Materials and site costs rose faster than general inflation through the post-pandemic period | Lower policy rates reduce financing cost but not input cost | oecd.org |
| Construction labour shortage | Skilled trades capacity constrains the rate at which approved units can be delivered | Capacity takes years to train, so a demand impulse raises prices before volumes | oecd.org |
| Restrictive land use policy | Zoning and permitting limit buildable land in high-demand locations | Cheaper credit bids up a fixed stock rather than expanding it | oecd.org (PDF) |
| Declining public investment | Public housing capital spending fell from 0.17 to 0.06 percent of GDP between 2001 and 2018 | The residual delivery channel is private and profit-constrained at the affordable end | unhabitat.org |
| Thin social rental sector | Social rental housing is under 5 percent of stock in roughly two thirds of OECD countries | No buffer absorbs households priced out of ownership, so rents take the pressure | oecd.org |
Only the Netherlands, Austria and Denmark hold social rental stock above the level the OECD treats as a meaningful buffer. Sources: OECD, Tackling the affordability gap, 2026; OECD affordability report (PDF), July 2026; UN-Habitat, World Cities Report 2026, chapter 3.