A â€œMedian House Price to Median Household Income Multiple" survey (I think someone posted one some time back on the old Owl forum) carried out by an American group using figures from the end of 2006.
Basically find the most common income level and the most common amount paid for a house and work out the multiple. Thus you have a number that they feel is a fair comparison location by location (I’m not agreeing, I’m just saying).
Of course there is always chicken and egg here, are prices higher in areas where people earn more? Or do people earn more where prices are higher? And how about that different lending regimes in each area? Can people borrow more because they earn more, or because they “have to” to afford more expensive properties?
BTW, if you don’t want to read the document …
The survey looked at The US, Canada, UK, New Zealand, Austrilia and Ireland. They estimated Dublin is the 37th most unaffordable location by their metric and rated in the severely unaffordable category along with cities that are just coming out of bubbles such as Los Angeles, San Diego, San Francisco, Sydeny, Perth as well as London, Boston and New York.