In the book “Order Without Design”, Alain Bertaud mentions that indicators are crucial in urban management to give cities a real-time view of what is happening within them. One interesting indicator related to housing affordability is the so-called “Price/Income Ratio.” This is essentially the average home price in a city divided by the average resident's income. It is a highly generic indicator that does not account for differences between properties, such as location, nor does it address rental housing (still a minority in Brazil). Nonetheless, it provides a general overview of housing affordability in a city.
Housing affordability in Brazil is typically measured by the housing deficit, an index usually published by the João Pinheiro Foundation. However, these figures only measure the number of substandard homes, cohabitation cases, households facing excessive rent burdens, or overcrowded housing. Looking solely at housing deficit metrics makes it difficult to gauge how expensive one city is relative to another. The Price/Income Ratio, however, can point us in the right direction.
