tag:theconversation.com,2011:/au/topics/housing-stress-3845/articles Housing stress – The Conversation2024-03-03T19:20:07Ztag:theconversation.com,2011:article/2235482024-03-03T19:20:07Z2024-03-03T19:20:07ZUrbanisation and tax have driven the housing crisis. It’s hard to see a way back but COVID provides an important lesson<p><em>This article is the first in The Conversation’s series examining the housing crisis. Read the other articles in the series <a href="https://theconversation.com/au/topics/housing-series-2024-153769">here</a>.</em></p>
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<p>The paradox of Australian housing is the abundance of land – 7.5 million square kilometres of it – and the shortage of accommodation.</p>
<p>The pandemic lockdowns and the changes that flowed from them have disrupted the paradox and will take some time to settle down.</p>
<p>By 1911, most of today’s towns were already established. Regional Australia was then home to <a href="https://www.bitre.gov.au/sites/default/files/report_136.pdf">60%</a> of the population.</p>
<p>Since then small towns have died, and regional centres have grown, much of the population has moved to the coast and cities for work, and new towns have grown to support mining in the north and west and farming in irrigation areas.</p>
<p>Today only <a href="https://www.abs.gov.au/statistics/people/population/national-state-and-territory-population/jun-2023">33%</a> of the population lives outside capital cities.</p>
<p>While the first census in 1911 recorded <a href="https://www.ausstats.abs.gov.au/ausstats/free.nsf/0/672F01666C9728B9CA2578390013E61F/$File/1911%20Census%20-%20Volume%20III%20-%20Part%20XII%20Occupations.pdf">24%</a> of the workforce was employed in agriculture, forestry or fishing, the most recent survey recorded less than <a href="https://labourmarketinsights.gov.au/industries/industry-details?industryCode=A">3%</a>.</p>
<h2>Cities made housing expensive</h2>
<p>Packing Australia’s population into capital cities helped push up land prices because the supply of well-located land in cities was limited.</p>
<p>The resultant <a href="https://www.aihw.gov.au/reports/children-youth/housing-stress">housing stress</a> is worse than the official figures suggest.</p>
<p>The Bureau of Statistics <a href="https://www.aihw.gov.au/reports/children-youth/housing-stress">defines</a> housing stress as occurring when a lower-income household spends more than 30% of its gross household income on housing costs. </p>
<p>But as homebuyers have moved further away from city centres to avoid high housing costs, they’ve been hit with higher commuting costs, boosting the number who are in financial stress because of housing. </p>
<p>A <a href="https://www.jstor.org/stable/26144329">study</a> I conducted with University of Canberra colleagues in the mid-2000s found that when commuting costs were included in housing costs the proportion of home owning couples with children in housing stress jumped from 15% to 19%.</p>
<h2>Housing became an ‘investment’</h2>
<p>Rising prices have made buying an extra home a “safe investment” for existing homeowners – all the more so when accompanied by generous <a href="https://images.theconversation.com/files/578471/original/file-20240228-28-6zq6z6.png">tax concessions.</a>.</p>
<p>The more homeowners bought second (and even <a href="https://www.ato.gov.au/about-ato/research-and-statistics/in-detail/taxation-statistics/taxation-statistics-2020-21/statistics/individuals-statistics#Table8Individuals">third</a>) properties, the more price pressure they added to prices which made lightly-taxed capital gains on investment properties seem an even safer bet.</p>
<p>The latest tax figures show <a href="https://data.gov.au/data/dataset/taxation-statistics-2020-21/resource/086c5441-f60a-4f78-8cd3-93d8856ebf2c">2.2 million</a> Australians owning investment properties, up from 1.2 million two decades earlier. This means that at a time when Australia’s population grew 32%, the number of Australians owning investment properties grew 83%.</p>
<p>The more homeowners make investment decisions on the assumption that prices will keep rising, the more resistant they become to measures that wind those price rises back. </p>
<p>Among those measures are <a href="https://www.jstor.org/stable/43189657">relaxed planning rules</a> that would increase the supply of competing properties, and changes to tax rules that would make investing less attractive.</p>
<p>Labor campaigned in <a href="https://webarchive.nla.gov.au/awa/20160627043846/http://pandora.nla.gov.au/pan/158841/20160627-1111/www.100positivepolicies.org.au/positive_plan_on_housing_affordability_capital_gains_tax_reform.html">2016</a> and again in <a href="https://webarchive.nla.gov.au/awa/20190513154843/http://pandora.nla.gov.au/pan/175559/20190514-0131/www.alp.org.au/policies/reforming-negative-gearing-and-capital-gains-tax-arrangements/index.html">2019</a> on restricting <a href="https://treasury.gov.au/review/tax-white-paper/negative-gearing">negative gearing</a> to new housing (with a <a href="https://lawpath.com.au/blog/grandfather-clauses-everything-you-need-to-know">grandfather</a> clause that would allow it to continue on properties that were already negatively geared) and halving the capital gains tax concession.</p>
<p>It lost both elections.</p>
<p>Modelling published in <a href="https://onlinelibrary.wiley.com/doi/full/10.1111/1467-8454.12335">Australian Economic Papers</a> finds that if Labor’s 2019 program had been adopted, the share of households who own their home rather than rent would have climbed 4.7 percentage points.</p>
<p>For most households that would have been able to buy but now have to rent,
renting is an inferior substitute.</p>
<p>But for landlords the displaced would-be owners are useful. They become tenants, helping the investment make sense.</p>
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Read more:
<a href="https://theconversation.com/how-albanese-could-tweak-negative-gearing-to-build-more-new-homes-222739">How Albanese could tweak negative gearing to build more new homes</a>
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<h2>Then came COVID</h2>
<p>The pandemic lockdowns prompted a rethink of how and where Australians lived.</p>
<p>Home offices became more attractive and group houses became less attractive pushing down the average number of <a href="https://www.rba.gov.au/speeches/2023/sp-gov-2023-04-05.html">residents per home</a> and pushing up the demand for homes even before borders reopened.</p>
<p>But many Australians discovered they didn’t need to live as close to their work and moved further away to more distant suburbs, and away from cities altogether to regional locations where housing was more affordable.</p>
<p>While this improved their quality of life by cutting housing and commuting costs, it overwhelmed the supply of houses in those regions and <a href="https://www.news.com.au/finance/economy/australian-economy/australians-desire-to-work-from-home-affecting-house-prices/news-story/da9e4605e132dc1a5a61506f07fd433d">pushed up prices</a>.</p>
<p>In time more homes will be built in those regions to accommodate more of them, unless there’s a <a href="https://www.abc.net.au/news/2023-11-30/push-for-staff-return-to-office-after-working-from-home/103148260">return to the office</a>.</p>
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Read more:
<a href="https://theconversation.com/covid-has-disrupted-our-big-and-regional-planning-has-to-catch-up-fast-139969">COVID has disrupted our big, and regional planning has to catch up fast</a>
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<p>The changes wrought by COVID will provide challenges and lessons for planning, especially planning for housing and infrastructure away from Australia’s cities.</p>
<p>Their enduring legacy is likely to be a demand for more housing per Australian, which will take some time to meet.</p>
<p>But even then, the dynamics of cities and tax concessions for householders who own more than one home are likely to conspire to keep pushing prices higher.</p>
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<p><em>Correction: an earlier version of this article said the first census was in 2011, rather than 1911. This has been amended.</em></p><img src="https://counter.theconversation.com/content/223548/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Yogi Vidyattama previously (in 2020) received funding from ACT Government for economic research related to housing. </span></em></p>Even changing the tax system won’t end steadily-climbing property prices. They are the result of urbanisation, and while COVID has eased some of the pressures, it has added some more.Yogi Vidyattama, Associate Professor, Faculty of Business, Government and Law, University of CanberraLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1131132019-03-14T19:00:45Z2019-03-14T19:00:45ZBuild social and affordable housing to get us off the boom-and-bust roller coaster<p>Not long ago Australia’s housing boom was in full swing. Investors were betting on rising property values, which <a href="https://www.domain.com.au/product/state-of-the-market-report-june-2017/">rose by 13% in Sydney and 15% in Melbourne</a> in the year to mid-2017. Now the withdrawal of overseas buyers and prudential restrictions on loose lending to local investors have revealed how hollow the boom was. </p>
<p>Throughout the boom, politicians and property pundits consistently claimed the supply being delivered would improve affordability. As we are now seeing, when the price a property can fetch drops, so too does the desire to build it. It was rampant price <em>growth</em> that underpinned developers’ pleas to add supply, <a href="https://www.linkedin.com/pulse/opinion-housing-need-cannot-fully-met-market-tim-williams/">not a desire to make housing more affordable</a>. </p>
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Read more:
<a href="https://theconversation.com/affordable-housing-policy-failure-still-being-fuelled-by-flawed-analysis-92993">Affordable housing policy failure still being fuelled by flawed analysis</a>
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<p>We are now seeing rapid declines in approvals and building starts as speculative investor demand, and the money it brought to the market, <a href="https://www.smh.com.au/business/the-economy/sydney-and-melbourne-house-values-fall-back-to-2016-levels-20190301-p5114v.html">has fallen away</a>.</p>
<p>Ironically, <a href="https://theconversation.com/why-falling-house-prices-do-less-to-improve-affordability-than-you-might-think-111267">falling prices will not improve affordability for people locked out of the market</a>. Banks are tightening lending practices and stagnant wage growth limits the buying capacity of those <a href="https://www.afr.com/real-estate/rental-affordability-worse-for-lowpaid-workers-and-negative-gearing-is-to-blame-20181128-h18fya">trapped in the low-income economy</a>. True, falling prices are welcome for some first home buyers who now find a purchase possible. But the rapid inflation of house prices long ago far outstripped the capacity of most lower-income households to buy a home.</p>
<p><a href="https://cityfutures.be.unsw.edu.au/research/projects/filling-the-gap/">Our analysis for the NSW Community Housing Industry Association (CHIA NSW) and Homelessness NSW</a>, building on <a href="https://www.ahuri.edu.au/research/final-reports/306">recent AHURI research</a>, shows that the market cannot meet around 12% of all households’ needs. Only one-third of those are housed outside the market in public or community housing. The rest are in overcrowded homes, rental stress or even homeless. </p>
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Read more:
<a href="https://theconversation.com/why-falling-house-prices-do-less-to-improve-affordability-than-you-might-think-111267">Why falling house prices do less to improve affordability than you might think</a>
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<p>In the face of a housing market downturn, those same property pundits are now <a href="https://www.smh.com.au/money/investing/why-labor-s-housing-policy-is-self-defeating-fraught-with-peril-20190228-p510u8.html">sternly warning against action</a> that would further dampen speculative investment in housing. However, this is precisely the moment to tackle the problems that have been building over many years and to set the dynamics of the housing system on a more affordable track. </p>
<p>Winding back speculative activity by cutting negative gearing and capital gains tax discounts, cracking down on inappropriate lending practices, and increasing regulation on unacceptable building practices should all be followed through in earnest across all levels of government.</p>
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Read more:
<a href="https://theconversation.com/vital-signs-why-now-is-the-right-time-to-clamp-down-on-negative-gearing-107370">Vital Signs: why now is the right time to clamp down on negative gearing</a>
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<h2>Delivering the housing we need</h2>
<p>The bigger question that remains then is: what is the future of the housing supply system across Australia?</p>
<p>History has shown us private sector investment alone cannot provide the needed housing, especially for the most vulnerable. Neither can it produce consistent supply through its boom-and-bust cycles. So now is also the moment for a renewed conversation about <em>how</em> to deliver the housing that’s most needed, and <em>who</em> ought to do it, especially for <a href="https://theconversation.com/housing-costs-are-actually-the-same-as-in-1993-but-renters-still-struggle-95286">those facing chronic rental stress</a>. </p>
<p>Markets have never delivered housing affordable to those on low incomes without subsidy from governments. In fact, a mountain of subsidies and tax breaks have been thrown at the private market to support such an aim. These range from <a href="https://www.dss.gov.au/housing-support/programmes-services/commonwealth-rent-assistance">Commonwealth Rent Assistance</a> to support private rental and grants to first time buyers, to negative gearing and capital gains tax relief for investors and home owners, but have had no discernible effect on affordability. </p>
<p>Faith in the markets has prevailed for the past 30 years. As a result, alternatives have been ruled out of play.</p>
<p>To cover the backlog of unmet need and future need, <a href="https://cityfutures.be.unsw.edu.au/research/projects/filling-the-gap/">our new research commissioned by CHIA NSW and Homelessness NSW </a> predicts that, over the next 20 years, <em>two in ten</em> new homes would need to be for social housing and a further <em>one in ten</em> for affordable housing. Just shifting this third of construction to not-for-profit housing providers, either the community sector or government, would reduce delivery costs – by losing the 20% developer markup at a stroke. </p>
<p>More broadly, the funds needed to support a sustainable affordable housing program could easily be offset by the savings from scrapping current inefficient and inflationary tax subsidises to private investors. </p>
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Read more:
<a href="https://theconversation.com/australia-needs-to-triple-its-social-housing-by-2036-this-is-the-best-way-to-do-it-105960">Australia needs to triple its social housing by 2036. This is the best way to do it</a>
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<p>The challenge of such a task cannot be underestimated. Yet this presents a considerable opportunity to resolve a range of interrelated problems with how housing is provided in Australia. Here are four of the biggest.</p>
<h2>1. Stabilise the construction labour market</h2>
<p>Social and affordable housing development would underwrite the construction industry with a steady stream of funding for building homes over the long term. Building industries mobilise considerable workforces. Stable streams of work would smooth out the dramatic drop in employment that comes with housing downturns. </p>
<p><a href="https://www.abc.net.au/news/2019-02-07/construction-decline-accelerates-amid-falling-prices-and-job-lo/10788782">Recent reports</a> have noted the accelerated decline in the construction industry. The <a href="https://www.smh.com.au/business/the-economy/house-price-falls-are-not-the-economy-s-biggest-worry-20190227-p510gk.html">Reserve Bank is warning</a> that shocks to wages and employment present a threat to the economy. </p>
<h2>2. Support planning for a predictable supply</h2>
<p>The planning system would benefit from having a large portion of projected housing needs met and supplied more predictably. The uncertainty of boom-bust housing cycles makes it near impossible to plan sensibly for population growth and implement strategic planning objectives across our cities and regions. </p>
<p>Planning for major infrastructure, such as hospitals, schools and transport, relies on new housing arriving in a timely manner. Blanket <a href="https://www.ahuri.edu.au/policy/ahuri-briefs/Understanding-inclusionary-zoning">inclusionary zoning</a> policies and discounted public land sales to support land supply for affordable homes need to be prerequisites.</p>
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Read more:
<a href="https://theconversation.com/england-expects-40-of-new-housing-developments-will-be-affordable-why-cant-australia-94581">England expects 40% of new housing developments will be affordable, why can't Australia?</a>
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<h2>3. The benefit of investing in affordable housing</h2>
<p>If government spending on housing can be invested in the assets themselves (for example, through an equity share in the development), the expenditure will be retained both for an enduring social purpose and as a positive contribution to the accumulated asset base of government. </p>
<p>A properly designed, large-scale, not-for-profit program could mean investing in new housing becomes a positive for state and national balance sheets. This requires a shift in behaviour and mindsets of some Treasury officials who often see social housing as a liability.</p>
<h2>4. Drive broad productivity dividends</h2>
<p><a href="https://cityfutures.be.unsw.edu.au/research/projects/strengthening-economic-cases-housing-productivity-gains-better-housing-outcomes/">Other recent research</a> for CHIA NSW shows investment in suitably located social and affordable housing has much wider economic benefits. These include travel time savings for lower-income workers currently pushed into the outer suburbs, as well as human capital uplift resulting from long-term positive impacts on household incomes. </p>
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Read more:
<a href="https://theconversation.com/key-workers-like-nurses-and-teachers-are-being-squeezed-out-of-sydney-this-is-what-we-can-do-about-it-91476">Key workers like nurses and teachers are being squeezed out of Sydney. This is what we can do about it</a>
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<p>Similarly, <a href="https://www.ahuri.edu.au/research/final-reports/265">government budgets benefit from reducing demand on social services</a>. </p>
<p>In short, the evidence-based economic case for government investment in social and affordable housing is strong. Given the impending fallout of a property bust following the largest property boom in Australian history, now is the time to act and reshape the nation’s housing system for the long term. </p>
<p>But do we have governments capable of conceiving of the necessary policy shifts or with the courage to enact them? Time, and the next election, will tell.</p><img src="https://counter.theconversation.com/content/113113/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Laurence Troy receives funding from the Australian Urban and Housing Research Institute (AHURI), the Australian Research Council (ARC) and the Community Housing Industry Association NSW (CHIA NSW). </span></em></p><p class="fine-print"><em><span>Bill Randolph receives funding from the ARC, AHURI, and CHIA NSW. He is a Director of Shelter NSW. </span></em></p><p class="fine-print"><em><span>Ryan van den Nouwelant receives funding from the Australian Urban and Housing Research Institute (AHURI), Southern Sydney Regional Organisation of Councils (SSROC) and the Community Housing Industry Association NSW (CHIA NSW).</span></em></p>Housing markets never have met the lowest-income households’ needs. Now is the time to tackle problems that have been years in the making by creating a better system to supply their housing.Laurence Troy, Research Fellow, City Futures Research Centre, UNSW SydneyBill Randolph, Director, City Futures Research Centre, Faculty of the Built Environment, UNSW SydneyRyan van den Nouwelant, Lecturer in Urban Management and Planning, Western Sydney UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1090072019-02-01T03:41:14Z2019-02-01T03:41:14ZHead start for home owners makes a big difference for housing stress<p>Housing affordability changes over the years for home owners, but this has been largely ignored. The focus has mostly been on entry-level affordability for home buyers. But how does affordability change over the years after people have bought their home? Our <a href="https://www.tandfonline.com/doi/full/10.1080/00049182.2018.1559971">newly published research in Australian Geographer</a> has found owners who entered the housing market 10-15 years ago are less likely to be in housing stress compared with renters or prospective home buyers.</p>
<p>Housing becomes unaffordable when households, especially lower-income households, spend more than 30% of their income on housing costs. Thus the threshold for affordability on our housing affordability index is 30 points. The index shows continuous improvement in ongoing housing affordability for owners over time. </p>
<p>In particular, those who entered the market 10-15 years ago are more likely to find their housing is affordable. Housing stress is not very relevant to them. This is a key benefit of ongoing home ownership. </p>
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Read more:
<a href="https://theconversation.com/housing-affordability-stress-affects-one-in-nine-households-but-which-ones-are-really-struggling-96103">Housing affordability stress affects one in nine households, but which ones are really struggling?</a>
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<p>Our study focused on Greater Sydney, where we found entry-level housing remains unaffordable in all regions, but the level of unaffordability varies across regions. Specifically, the deterioration in housing affordability is more obvious in lower-income regions such as Western Sydney. </p>
<p>Ongoing housing affordability for those who have entered the market improves considerably within five to ten years. However, there are again significant differences between regions. Residents in lower-income regions such as Western Sydney take longer to improve their ongoing affordability than residents in high-income regions, such as eastern Sydney. </p>
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Read more:
<a href="https://theconversation.com/mission-nearly-impossible-the-city-of-sydneys-efforts-to-increase-the-affordable-housing-supply-93366">Mission nearly impossible: the City of Sydney's efforts to increase the affordable housing supply</a>
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<h2>Benefits of home ownership are clear</h2>
<p>Ongoing housing affordability examines how affordability evolves from the year after entry into the housing market for each cohort of entrants. This is a superior housing affordability measure for most households, particularly current home owners. Importantly, it also demonstrates the benefits and importance of home ownership. </p>
<p>Our ongoing housing affordability indices suggest households in Greater Sydney may experience some level of housing stress in the first five years after buying a house. But this improves from the tenth year after entering and continuously staying in the market. </p>
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<a href="https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=286&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=286&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=286&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=359&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=359&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256752/original/file-20190201-127151-is56sl.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=359&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Figure 1. Ongoing housing affordability index for Greater Sydney showing changes by year of market entry.</span>
<span class="attribution"><a class="source" href="https://www.tandfonline.com/doi/full/10.1080/00049182.2018.1559971">Bangura & Lee, Australian Geographer (2019)</a>, <span class="license">Author provided</span></span>
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<p>For instance, ongoing housing affordability for the cohorts who entered the market in Greater Sydney in 1992 improved significantly from an index value of 38.3 points (a lower index value represents higher housing affordability) in 1992 to around 19 points in 2002. It improved by another 9.5 points by 2016. This reflects a continuous improvement in housing affordability for ongoing owners.</p>
<p>This improvement is explained by a combination of two factors. First, owner incomes typically rose in the years after they first bought a house. Second, those who got in early also avoided the house price inflation of recent times. This means those who entered the market 20 years ago probably do not find their housing is severely unaffordable. </p>
<p>A comparison between the cohort who entered the market in 1992 and the cohort who entered the market in 2015 shows clear differences. The 1992 cohort has a lower housing affordability index value of 9.5 points (meaning more affordable) in 2016 compared to 60.3 points for the 2015 cohort. Housing is clearly much less affordable for new entrants or home owners than for those who entered markets 23 years earlier. </p>
<p>Renters or prospective home buyers are also more likely in housing stress compared with current homeowners, particularly those who entered the market 10-15 years ago. Entering the housing market earlier made a big difference for housing stress. Thus, the long-term benefits of home ownership should be promoted to prospective house buyers.</p>
<h2>Affordability gains vary across regions</h2>
<p>Ongoing housing affordability for home owners improves considerably within five to ten years of entering the market. However, the ongoing affordability indices show the rate of this improvement varies across different regions of Sydney.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=296&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=296&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=296&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=372&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=372&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256753/original/file-20190201-112389-n9rn5q.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=372&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<a href="https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=381&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=381&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=381&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=479&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=479&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256755/original/file-20190201-103164-ln3wbi.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=479&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<a href="https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=345&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=345&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=345&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=433&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=433&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256756/original/file-20190201-42594-w1kkmg.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=433&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<a href="https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=341&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=341&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=341&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=428&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=428&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256757/original/file-20190201-108334-1wqrmz4.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=428&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<a href="https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=362&fit=crop&dpr=1 600w, https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=362&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=362&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=455&fit=crop&dpr=1 754w, https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=455&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/256758/original/file-20190201-108338-346q0y.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=455&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Figure 2. Ongoing housing affordability indices for Greater Sydney regions, showing changes by year of market entry.</span>
<span class="attribution"><a class="source" href="https://www.tandfonline.com/doi/full/10.1080/00049182.2018.1559971">Bangura & Lee, Australian Geographer (2019), Adapted from the differential geography of housing affordability in Sydney: a disaggregated approach, Australian Geographer</a>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Figure 2 shows that residents in lower-income regions (such as Western Sydney) take longer to reach the affordability threshold of 30 points than residents in higher-income regions (Eastern Sydney). This is likely to affect the consumption and welfare of households, particularly those from lower-income regions. </p>
<h2>What next?</h2>
<p>The research findings point to two key take-outs:</p>
<ol>
<li><p>Long-term owners’ head start makes a big difference for housing stress. Policymakers should promote home ownership as a means to reduce housing stress among prospective home buyers as housing affordability improves over time for home owners. </p></li>
<li><p>Governments should redesign existing housing policies to enhance affordability for all households, but particularly entry-level housing for low-income households.</p></li>
</ol>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/six-lessons-on-how-to-make-affordable-housing-funding-work-across-australia-91072">Six lessons on how to make affordable housing funding work across Australia</a>
</strong>
</em>
</p>
<hr>
<img src="https://counter.theconversation.com/content/109007/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Affordability is a problem across Sydney for prospective home buyers. But if they are able to become owners, new research shows affordability becomes much less of a problem over five to ten years.Mustapha Bangura, Part-time lecturer and PhD Candidate in Property Economics, Western Sydney UniversityChyi Lin Lee, Associate Professor of Property, Western Sydney UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/996022018-08-13T20:17:51Z2018-08-13T20:17:51ZHow far have we come since the ’80s vision of the ‘non-sexist city’?<figure><img src="https://images.theconversation.com/files/231616/original/file-20180813-2897-1h3c6vy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">If vintage city design used to trap women in suburbia, what's the modern city looking like?</span> <span class="attribution"><span class="source">from shutterstock.com</span></span></figcaption></figure><p>In 1980, the feminist journal <a href="https://www.jstor.org/stable/3173814?seq=1#page_scan_tab_contents">Signs</a> published a visionary essay asking readers to imagine <a href="https://www.scribd.com/document/269155190/Summary-of-Non-Sexist-City">what a non-sexist city would be like</a>. A then junior professor of urban planning at the University of California, Dolores Hayden, wrote the essay.</p>
<p>Hayden argued that architects and urban planners worked off the implicit understanding that a woman belonged in the home. She believed the isolated, suburban family house had been designed as a retreat for the male breadwinner, trapping the woman in the role of a homemaker and carer. </p>
<p>With more women entering paid work and family sizes shrinking, Hayden saw the design of the city – and the family home – as having potential for creating more equal relationships. Nearly 40 years on, <a href="https://theconversation.com/australias-changing-profile-fewer-divorces-higher-incomes-more-rental-stress-46347">society’s profile</a> has evolved further. We’re having fewer children, more of us live alone, and women are in paid employment in ever-greater numbers.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/australias-changing-profile-fewer-divorces-higher-incomes-more-rental-stress-46347">Australia's changing profile: fewer divorces, higher incomes, more rental stress</a>
</strong>
</em>
</p>
<hr>
<p>And yet, despite this, the design of the modern city suggests urban planners may still be perpetuating stereotypes of the patriarchal family. We have some way to create a more equal city.</p>
<h2>What is the non-sexist city?</h2>
<p>Hayden argued the built environment helped shape ideas of how a “normal family” should use space. She said <a href="https://www.buzzfeed.com/briangalindo/17-ridiculously-sexist-vintage-ads?utm_term=.uj8RVv6X7#.hg8g2y7LG">advertisements of the time</a> – such as those showing the importance of women’s attractiveness to a man with overt links to being good homemakers – reinforced women’s roles as consumers rather than producers of valued work.</p>
<p>Hayden wrote that home design that separated one family from another privatised family life. Separating areas for cooking and laundry from the main part of the house, as well as placing housing some distance from schools and children’s activities, locked women into laborious days of invisible house and care work.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=818&fit=crop&dpr=1 600w, https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=818&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=818&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1029&fit=crop&dpr=1 754w, https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1029&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/231610/original/file-20180813-2891-6hypp8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1029&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Mid-20th-century advertisements were targeted at women as the primary consumers.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/jbcurio/5803063854">Jamie/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>Hayden reimagined the family home, and the city around it, as being accessible for women who were now doing a “double work day”. She pointed to designs that overturned assumptions that domestic must be separated from public space. </p>
<p>These included projects such as London’s Fiona House, designed by single mother and architect Nina West. This project (along with other housing blocks West designed for single parents in the early ’80s) had a <a href="https://www.csmonitor.com/1981/0423/042320.html">linked childcare centre</a>.</p>
<p>In her book, <a href="https://books.google.com.au/books/about/The_Grand_Domestic_Revolution.html?id=iqGqQgAACAAJ&redir_esc=y">The Grand Domestic Revolution</a>, Hayden excavated <a href="https://www.youtube.com/watch?v=39xNeMVDfDA">utopian 19th-century feminist ideas </a> for kitchenless single houses with communal kitchens in a block. As <a href="https://highered.nbclearn.com/portal/site/HigherEd/browse/?cuecard=45101">she told TV host Phil Donahue in 1981</a>, women would prepare meals in these communal houses and charge men at home, cash on delivery. </p>
<p>When a shocked Donahue asked if she was really proposing this, she said:</p>
<blockquote>
<p>I think that we should consider the economic importance of housework and childcare as a crucial factor in the economy today. And I think we should consider the stresses on the employed mother who has a second job at home.</p>
</blockquote>
<figure class="align-left zoomable">
<a href="https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=410&fit=crop&dpr=1 600w, https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=410&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=410&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=515&fit=crop&dpr=1 754w, https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=515&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/230171/original/file-20180801-136664-9ga3n8.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=515&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Dolores Hayden told Ed Donahue the traditional model of the family home he was holding up was the patriarchal family ideal.</span>
<span class="attribution"><a class="source" href="https://highered.nbclearn.com/portal/site/HigherEd/browse/?cuecard=45101">Screenshot from NBC Learn</a></span>
</figcaption>
</figure>
<p>Hayden proposed communal housing developments, each comprised of 40 households, with shared laundry and kitchen facilities. But she also drew attention to restrictive zoning regulations that didn’t allow for such facilities in residential areas.</p>
<p>In 1980s America, such a vision, as Donahue noted, wouldn’t be an easy sell. But how much progress have we made since? </p>
<p>Beyond obvious differences between Australia and the United States, is our city design still trapping women in suburbia and expecting them to do most, if not all, the home and care work?</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=409&fit=crop&dpr=1 600w, https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=409&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=409&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=514&fit=crop&dpr=1 754w, https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=514&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/230172/original/file-20180801-136646-6526g5.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=514&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Hayden imagined residential blocks of communal living.</span>
<span class="attribution"><a class="source" href="https://highered.nbclearn.com/portal/site/HigherEd/browse/?cuecard=45101">Screenshot from NBC Learn (Author Dolores Hayden discusses 'Domestic Revolution')</a></span>
</figcaption>
</figure>
<h2>Australia could do better</h2>
<p>We’ve definitely moved closer to gender equality in cities. For instance, there are more childcare centres in residential areas and greater state support for childcare out of the home. </p>
<p>But we’re not still there completely. Using public transport while caring for a child can be difficult. <a href="https://www.smh.com.au/national/nsw/government-land-sale-to-fund-redfern-station-upgrade-leaked-docs-show-20180809-p4zwhi.html">Some train stations</a> force passengers to use stairs to get to most platforms – not an easy feat for a parent with a pram.</p>
<p>While outsourcing services – such as food preparation and home maintenance – are on the rise in the gig economy, these <a href="http://www.abc.net.au/radio/programs/pm/gig-economy/8828724">jobs don’t pay a living wage</a> when provided solely by the market without regulation. </p>
<p>And there is more socioeconomic division than before. Home ownership is becoming <a href="https://www.sbs.com.au/news/comment-rent-or-buy-let-s-do-the-sums">more unaffordable</a>. <a href="https://theconversation.com/size-does-matter-australias-addiction-to-big-houses-is-blowing-the-energy-budget-70271">Recent research</a> has found that the floorplan of the Australian house has more than doubled since 1950, while the number of people living there has shrunk. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=397&fit=crop&dpr=1 600w, https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=397&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=397&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=499&fit=crop&dpr=1 754w, https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=499&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/231647/original/file-20180813-2903-1gsblcy.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=499&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Australian houses are getting bigger, while family sizes are shrinking.</span>
<span class="attribution"><span class="source">from shutterstock.com</span></span>
</figcaption>
</figure>
<p>Single-parent households, and particularly female-headed ones, <a href="https://www.domain.com.au/money-markets/single-parents-renters-at-particular-risk-of-financial-stress-study-20180731-h13ayw-755393/">particularly struggle</a> to find affordable housing. There has been a <a href="http://chp.org.au/no-room-to-breathe-why-severe-overcrowding-is-a-form-of-homelessness/">reported rise</a> of 25% from 2011 to 2016 in what is defined as severely overcrowded housing. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/overcrowded-housing-looms-as-a-challenge-for-our-cities-96110">Overcrowded housing looms as a challenge for our cities</a>
</strong>
</em>
</p>
<hr>
<p>There have been recent feminist-inspired architectural innovations such as the <a href="https://www.archdaily.com/793370/the-kitchenless-house-a-concept-for-the-21st-century">kitchenless house</a>. But these don’t seem to <a href="https://doi.org/10.1177/0950017014568140">have taken hold</a> against persistent indications <a href="http://journals.sagepub.com/doi/10.1177/0950017014568140">women are still doing the bulk of caring labour, even if they work from home</a>.</p>
<p>And what of the 40-household communal living ideal? Today, in Australia, such a proposal would still face complex rules and eligibility requirements for sharing common facilities in developments such as <a href="https://www.thefifthestate.com.au/innovation/residential-2/whats-the-big-driver-for-co-op-housing-we-askand-find-many-answers">co-operative housing</a>. However, <a href="http://www.abc.net.au/news/2017-08-03/affordable-housing-ownership-can-help-housing-crisis/8767906">shared equity schemes</a> do exist in some states, though community attitudes to encountering <a href="http://www.abc.net.au/news/2015-12-01/perth-high-density-housing-aversion-to-neighbours/6990804">neighbours in shared space</a> could be a barrier.</p>
<p>Overall, alongside a rise in couples without children and single-person households, the problems of our cities fall most heavily on low-income families. The non-sexist city was never intended to be more equal for only one group of Australians.</p><img src="https://counter.theconversation.com/content/99602/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Justine Lloyd receives funding from Landcom/UrbanGrowth NSW's Communities of Practice, and has previously received research funding from the Australian Research Council and the Australian Collaborative Education Network. </span></em></p>In the 1970s, a young urban planning professor, Dolores Hayden, believed that city design was the key to unlocking patriarchal structures that trapped women in the home. How much has the city changed?Justine Lloyd, Lecturer in Sociology, Macquarie UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1008182018-08-09T20:12:15Z2018-08-09T20:12:15ZInteractive: how have your family’s fortunes changed? Use this drag-and-drop tool to find out<figure><img src="https://images.theconversation.com/files/231016/original/file-20180808-191013-la3sza.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Do you feel that, overall, you’re “better off” than you were in the past? Or that things are getting worse, or have plateaued?</p>
<p>We now have the data to get us a pretty good answer to that question, right down to the detail by “family types”, as categorised by the <a href="https://melbourneinstitute.unimelb.edu.au/hilda/publications/hilda-statistical-reports">Household, Income and Labour Dynamics in Australia (HILDA) Survey</a>. Starting in 2001, this longitudinal survey now tracks more than 17,500 people in 9,500 households.</p>
<p>The interactive below lets you drag and drop your family members into the house to see what the HILDA data reveal.</p>
<p><iframe id="tc-infographic-288" class="tc-infographic" height="1400" src="https://cdn.theconversation.com/infographics/288/d37d6b2e4bd124d29f741dd4bf99ca8f4e8bd69e/site/index.html" width="100%" style="border: none" frameborder="0"></iframe></p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/politicians-stop-pitching-to-the-average-australian-being-middle-class-depends-on-where-you-live-88470">Politicians, stop pitching to the 'average' Australian; being middle class depends on where you live</a>
</strong>
</em>
</p>
<hr>
<p>One measure we’re showing is what economists call “<a href="http://www.abs.gov.au/ausstats/abs@.nsf/0/A390E2529EC00DFECA25720A0076F6C6?opendocument">equivalised income</a>”. That’s different to your total household income; here’s how the HILDA report explains it:</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=447&fit=crop&dpr=1 600w, https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=447&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=447&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=562&fit=crop&dpr=1 754w, https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=562&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/231054/original/file-20180808-191038-1uc0ko5.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=562&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption"></span>
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</figure>
<p>Overall, median equivalised incomes have gone up since 2001 for all family types, but some have fared better than others, as this chart from the full HILDA report shows:</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=704&fit=crop&dpr=1 600w, https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=704&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=704&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=885&fit=crop&dpr=1 754w, https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=885&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/231053/original/file-20180808-142251-ug30zp.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=885&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption"></span>
</figcaption>
</figure>
<p>For the purposes of interpreting the HILDA data, you might need to be a bit flexible when deciding which “family type” applies to you. For example, a household with two single, adult sisters living together will be classified as two single-person “families”, even though they might see themselves as a family unit.</p>
<p>And it’s worth remembering, as the HILDA report <a href="https://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0005/2839919/2018-HILDA-SR-for-web.pdf">notes</a>:</p>
<blockquote>
<p>… some households will contain multiple “families”. For example, a household containing a non-elderly couple living with a non-dependent son will contain a non-elderly couple family and a non-elderly single male. Both of these families will, of course, have the same household equivalised income. Also note that, to be classified as having dependent children, the children must live with the parent or guardian at least 50% of the time. Consequently, individuals with dependent children who reside with them less than 50% of the time will not be classified as having resident dependent children.</p>
</blockquote>
<figure>
<iframe width="440" height="260" src="https://www.youtube.com/embed/IpZ8P4-Afj8?wmode=transparent&start=0" frameborder="0" allowfullscreen=""></iframe>
</figure>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/trust-me-im-an-expert-what-the-huge-hilda-survey-reveals-about-your-economic-well-being-health-and-family-life-100751">Trust Me, I'm An Expert: what the huge HILDA survey reveals about your economic well-being, health and family life</a>
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</p>
<hr>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/hilda-survey-reveals-striking-gender-and-age-divide-in-financial-literacy-test-yourself-with-this-quiz-100451">HILDA Survey reveals striking gender and age divide in financial literacy. Test yourself with this quiz</a>
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</p>
<hr>
<img src="https://counter.theconversation.com/content/100818/count.gif" alt="The Conversation" width="1" height="1" />
Use our drag-and-drop interactive to find out how incomes, financial wellbeing, and housing stress has changed since 2001 for various ‘family types’, including singles or couples without children.Sunanda Creagh, Senior EditorLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/999362018-07-16T20:09:50Z2018-07-16T20:09:50ZThe new national housing agreement won’t achieve its goals without enough funding<figure><img src="https://images.theconversation.com/files/227734/original/file-20180716-44088-i7gek.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">There's never been enough funding to ensure affordable housing for those who need it.</span> <span class="attribution"><span class="source">from shutterstock.com</span></span></figcaption></figure><p>This month, yet another policy agreement on housing between the Commonwealth and state and territory governments came into effect. The <a href="http://www.federalfinancialrelations.gov.au/content/housing_homelessness_agreement.aspx">National Housing and Homelessness Agreement</a> is the latest version of a 73-year-long series of such intergovernmental pacts to ensure affordable housing for lower-income Australians and to fund services for the homeless.</p>
<p>It replaces the ten-year <a href="http://www.federalfinancialrelations.gov.au/content/npa/national_agreements/national-housing-agreement.pdf">National Affordable Housing Agreement</a> and a series of partnerships since 2008 to tackle homelessness – the <a href="http://www.federalfinancialrelations.gov.au/content/npa/housing/national-partnership/Transitional_Homelessness.pdf">National Partnership Agreement on Homelessness</a>. The latest agreement has more achievable performance indicators than its predecessors. It also requires the states to report on their annual financial contributions – a worthy step up for transparency. </p>
<p>But, at a time of growing population and enduring housing stress, the Commonwealth’s latest budget <a href="https://www.budget.gov.au/2017-18/content/glossies/factsheets/html/HA_17.htm">promise to maintain</a> its current funding contribution of A$1.3 billion for the housing agreement means there has been no increase in real funding. Keeping it at what it has been <a href="https://theconversation.com/australia-needs-to-reboot-affordable-housing-funding-not-scrap-it-72861">isn’t enough to cover the costs of current services</a>, let alone increase them.</p>
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<em>
<strong>
Read more:
<a href="https://theconversation.com/australia-needs-to-reboot-affordable-housing-funding-not-scrap-it-72861">Australia needs to reboot affordable housing funding, not scrap it</a>
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<p>So, there is a disconnect between the lofty goal of improving access to affordable, safe and sustainable housing and the funding capable of supporting it. Until this funding shortfall is addressed, any new national housing and homelessness agreements will continue to be essentially different in name only.</p>
<h2>What’s new this time?</h2>
<p>Compared to recent former agreements, three matters stand out as new or refreshed.</p>
<p>First is the policy breadth. Unlike its predecessors, the new agreement aspires to improve access to housing “across the housing spectrum”. This refers to the full suite of housing tenures – from crisis housing to home ownership. Within this spectrum the Commonwealth has set several immediate priorities:</p>
<ul>
<li>achieving an efficient, responsive and well-managed social housing system</li>
<li>support for community housing and affordable housing models that can viably increase housing supply</li>
<li>tenancy reform that encourages security of tenure in the private rental market</li>
<li>strategies to promote market supply and efficiency, including planning system reforms, land-release initiatives and support for home ownership.</li>
</ul>
<p>This broadened coverage is generally welcome, but it falls short of satisfying the <a href="http://everybodyshome.com.au/">calls for a national housing strategy</a>. This means many national policies with major impacts on housing demand and cost – such as taxes on housing investment, immigration levels and income support for renters – remain outside the influence of the agreement. Such policies also strongly influence the prospects of reducing housing stress.</p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/a-national-affordable-housing-strategy-necessary-attainable-and-maybe-on-its-way-49943">A national affordable housing strategy: necessary, attainable and maybe on its way</a>
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<p>The second, and arguably biggest, set of changes concerns accountability. This includes an expanded list of performance measures, the Commonwealth leading a standardised approach to data measures, and a formal independent Productivity Commission review of the agreement to be conducted within four years.</p>
<p>The new performance indicators replace the targets from 2008, which were never achieved. The failed measures were quantitative in nature, while the new ones simply adopt a requirement for progress (an increase or a decrease, as appropriate), which can be more readily achieved. </p>
<p>For example, the Rudd government’s pledge to halve the rate of homelessness by 2020 has shifted to “decreases in people experiencing homelessness and repeat homelessness”. Similarly, the 2008 commitment to reduce the proportion of low-income renter households experiencing <a href="http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/by%20Subject/1370.0%7E2010%7EChapter%7ERental%20stress%20(5.4.2.1)">rental stress</a> by 10% has been replaced by a commitment to simply reduce the proportion of such households.</p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/homeless-numbers-will-keep-rising-until-governments-change-course-on-housing-93417">Homeless numbers will keep rising until governments change course on housing</a>
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<p>A third feature is a requirement for states and territories to annually publish housing strategies. Stakeholders will be able to judge and compare the merit of these published blueprints. These will come after a new set of high-level bilateral agreements negotiated between each state and territory and the Commonwealth.</p>
<p>This highlights differences in housing conditions between jurisdictions and incorporates state-level priorities in addition to those of the Commonwealth. <a href="http://www.federalfinancialrelations.gov.au/content/housing_homelessness_agreement.aspx">Those published so far</a> vary considerably in ambition and specificity.</p>
<h2>The elephant in the room</h2>
<p>While there are positive directions in the new agreement, the funding deficit remains an issue. Despite not increasing its funding, the Commonwealth hopes the states and territories will increase theirs.</p>
<p>The Commonwealth, however, has failed to extend or replace other large housing programs that operated in the past decade. These included the now closed <a href="https://www.dss.gov.au/our-responsibilities/housing-support/programmes-services/national-rental-affordability-scheme">National Rental Affordability Scheme</a>, which resulted in over 36,000 new affordable rental houses, and a A$5 billion <a href="http://www.federalfinancialrelations.gov.au/content/npa/housing/national-partnership/past/remote_indigenous_housing_NP.pdf">national partnership</a> to improve housing supply and conditions in remote (largely Indigenous) communities. </p>
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<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/we-wont-close-the-gap-if-the-commonwealth-cuts-off-indigenous-housing-support-91835">We won't close the gap if the Commonwealth cuts off Indigenous housing support</a>
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<p>As a result there is now less federal funding for new social and affordable housing than at any time over the last decade. </p>
<p><a href="https://www.ipart.nsw.gov.au/Home/Industries/Special-Reviews/Reviews/Affordable-Housing/Review-of-Social-and-Affordable-Housing-Rent-Models/04-Sep-2017-Final-Report/Final-Report-Review-of-rent-models-for-social-and-affordable-housing-July-2017;%20https:/treasury.gov.au/consultation/council-on-federal-financial-relations-affordable-housing-working-group-innovative-financing-models/;https:/www.ahuri.edu.au/research/final-reports/106">With so much detailed by so many</a> about the manifest inadequacy in funding required to meet housing need in Australia, we can regrettably predict that the new agreement will not contribute much at all to an increased supply of social and affordable housing. Indeed, this is tacitly acknowledged – the agreement’s carefully crafted performance indicators include no such measure.</p><img src="https://counter.theconversation.com/content/99936/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Vivienne Milligan receives funding from the Australian Housing and Urban Research Institute (AHURI) and the NSW Government. She is a non-executive director of the NSW Community Housing Industry Association.</span></em></p>Another affordable housing pact between the Commonwealth, states and territories came into effect this month. But with no new funding, the agreement may be different from predecessors in name only.Vivienne Milligan, Visiting Senior Fellow - City Futures Research Centre, Housing Policy and Practice, UNSW SydneyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/959262018-07-15T18:47:02Z2018-07-15T18:47:02ZWhy Australia’s homelessness problem is getting worse, despite a rise in housing stock<p>New housing supply is simply not expanding affordable housing opportunities for the poor in a way that reduces the homelessness count. We <a href="https://cloud.3dissue.com/122325/122578/143598/WhyNewSupplyisnotExpandingHousingOptionsfortheHomeless/index.html">argue that</a> this is due to certain barriers that prevent new supply from filtering down to low-income groups. </p>
<p>Politicians and economists often claim <a href="http://sjm.ministers.treasury.gov.au/speech/005-2017/">a housing supply crisis</a> is to blame for the lack of affordable housing in Australia. They say increases in housing stock are failing to keep pace with population growth. </p>
<p>In a 2017 address to the Australian Housing and Urban Research Institute, Treasurer <a href="http://sjm.ministers.treasury.gov.au/speech/005-2017/">Scott Morrison said</a>:</p>
<blockquote>
<p>… for certain Australian households, housing affordability is an issue regardless of where they live due to economic reasons … However, in Sydney and Melbourne where supply has failed to keep pace with rising demand, the problem is far more acute… The principal cause of declining housing affordability is the failure of housing supply to adjust to increased demand…</p>
</blockquote>
<p>Yet housing approval data from the Australian Bureau of Statics show the growth in housing stock has actually outpaced rates of population increase in all Australian capital cities. </p>
<iframe id="datawrapper-chart-WGWnh" src="https://datawrapper.dwcdn.net/WGWnh/1/" scrolling="no" frameborder="0" allowtransparency="true" style="width: 0; min-width: 100% !important;" height="400" width="100%"></iframe>
<p>Between 2005-06 and 2014-15, housing stock has expanded by over 22% while population growth has lagged behind at 19%. Despite this, <a href="https://www.tandfonline.com/doi/abs/10.1080/08111146.2017.1374945">median residential property prices nearly doubled</a> in the same period. </p>
<h2>How it should work in theory</h2>
<p>Increasing housing stock only works to make housing more affordable if certain <a href="http://www.hup.harvard.edu/catalog.php?isbn=9780674543430">filtering processes occur</a>. This is how it looks if the number of new homes increases while the number of households stays fixed or increases at a slower pace.</p>
<p>Those in higher-income households may wish to upgrade to a newer, more expensive house. The established home they vacate would be more appealing to other households if it falls in price. This would then make it affordable to a middle-income household. And the home this middle-income household will vacate would then also fall in value and become affordable for a lower-income household.</p>
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Read more:
<a href="https://theconversation.com/australias-almost-a-world-leader-in-home-building-so-that-isnt-a-fix-for-affordability-73514">Australia's almost a world leader in home building, so that isn't a fix for affordability</a>
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</p>
<hr>
<p>Eventually, affordable housing opportunities would trickle down to the homeless, and the homelessness count would decline. But, in Australia, <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/2049.0">homelessness is on the rise</a>. Back in 2006, fewer than 90,000 people were homeless. Within a decade, that number has climbed by nearly one-third, to more than 116,000 people – a 10% increase.</p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/227549/original/file-20180713-27018-kl93d8.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">The number of homeless people in NSW has increased more than any other state.</span>
<span class="attribution"><a class="source" href="https://www.flickr.com/photos/indavar/37039496230/in/photolist-Yr46MY-pxhMBT-Yr3qeE-XJVSuU-Z3gnX4-YKvdmf-XJW31h-XNt3x8-Yr3HS5-XJWtrs-YKvgBy-XJWaM9-YKv7dU-Z3g9YD-YM56NQ-YKuMoE-fvbxP2-5XiqRC-8369Jd-Z3fRNX-dXN62e-6x2cR2-YM4KP1-dXTKYf-Z3gpci-Yr3pim-81FrFK-jVC4Xu-Z3gaBT-jVAnkZ-XJWyyb-6quFXv-YKvgGJ-Yr3oK7-jVC2hE-Z3fUPB-Yr45dL-XNtvAg-YM4Jvj-YPE7ST-Yr452y-YPEQnX-Yr3Ffb-XJVVWJ-YKvbgd-YKvb37-YKvctd-Z3gpDk-Z3ghUD-jVzA3X">Ivan Wong Rodenas/Flickr</a>, <a class="license" href="http://creativecommons.org/licenses/by/4.0/">CC BY</a></span>
</figcaption>
</figure>
<p>New South Wales has fared the worst. The number of homeless people in NSW has soared by 70% between 2006 and 2016. With the exception of the Northern Territory, all other states and territories witnessed an increase in homelessness in this period. </p>
<p>So, despite the rise in housing stock, most states and territories have failed to contain, never mind reverse, the rise in homelessness over the last decade. Why are the filtering processes not working?</p>
<h2>Barriers to affordability</h2>
<p>Deregulation of Australian financial markets and tax concessions have combined to make residential property an attractive investment, especially for higher-income households. So a higher-income earner would gain an additional property rather than swapping one for the other and leaving the vacated one affordable for the next in line.</p>
<p>And if a substantial share of new housing is being purchased as holiday homes or investments, this can stifle the trickle down of affordable housing opportunities. </p>
<p>The recent growth in net overseas migration is a likely barrier as well. Between 2004 and 2015, net <a href="http://www.abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/3412.02015-16?OpenDocument">overseas migration climbed</a> by 30%, from 138,800 to 181,050. This has outstripped the 22% housing stock growth rate over roughly the same period. </p>
<hr>
<p>
<em>
<strong>
Read more:
<a href="https://theconversation.com/housing-affordability-stress-affects-one-in-nine-households-but-which-ones-are-really-struggling-96103">Housing affordability stress affects one in nine households, but which ones are really struggling?</a>
</strong>
</em>
</p>
<hr>
<p>While migration is included in overall population numbers, in this case, the houses migrants are vacating to move to Australia remain in their home country. So this doesn’t contribute to the filtering process.</p>
<p>Transaction costs (mainly high stamp duties) can deter people from trading up, or downsizing. Transaction costs are a <a href="https://www.taxinstitute.com.au/australian-tax-forum/stamp-duties-land-tax-and-housing-affordability-the-case-for-reform">drag on resident movements and suppress housing stock turnover</a>.</p>
<p>Finally, land and building regulations can play a role. Elderly people who may wish to downsize from a family home to an apartment usually <a href="https://www.ahuri.edu.au/__data/assets/pdf_file/0013/2191/AHURI_Final_Report_No217_Housing-equity-withdrawal-uses,-risks,-and-barriers-to-alternative-mechanisms-in-later-life.pdf">want to live in the same neighbourhood</a>. Yet planning interventions may prevent the construction of units in the suburbs downsizers would prefer.</p>
<p>Until these barriers are lowered, simply increasing new housing supply cannot be the silver bullet that fixes homelessness and the housing affordability concerns of the Australian population.</p><img src="https://counter.theconversation.com/content/95926/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gavin Wood receives research funding from the Australian Housing and Urban Research Institute. . </span></em></p><p class="fine-print"><em><span>Rachel Ong ViforJ does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>It’s said Australia’s housing affordability problem is the result of new housing stock not keeping pace with population growth. But there is actually enough housing, so why can’t the poor afford it?Rachel Ong ViforJ, Professor of Economics, School of Economics, Finance and Property, Curtin UniversityGavin Wood, Emeritus Professor of Housing and Housing Studies, RMIT UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/809652017-08-01T20:14:52Z2017-08-01T20:14:52ZAffordable housing shortfall leaves 1.3m households in need and rising – study<figure><img src="https://images.theconversation.com/files/179958/original/file-20170727-25744-1nrj695.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Around one in seven Australia households either cannot get into housing at market rates or are struggling to pay the rent.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/sad-evicted-family-worried-relocating-house-487430101?src=xuQBPCAz4t67TTvcmAF3-g-1-8">shutterstock</a></span></figcaption></figure><p>A <a href="http://www.ahuri.edu.au/research/final-reports/287">new report</a> by the Australian Housing and Urban Research Institute (AHURI) reveals, for the first time, the extent of housing need in Australia. An estimated 1.3 million households are in a state of housing need, whether unable to access market housing or in a position of rental stress. This figure is predicted to rise to 1.7 million by 2025. </p>
<p>To put it in perspective, 1.3 million is around <a href="http://www.abs.gov.au/ausstats/abs@.nsf/Latestproducts/3236.0Main%20Features42011%20to%202036">14% of Australian households</a>. This national total includes 373,000 households in New South Wales, where the number is expected to increase by 80% to more than 670,000 by 2025 under the baseline economic assumptions of the modelling. </p>
<p>The first graph below shows the average annual level of housing need to 2025. The second, showing the percentages of households, permits a direct comparison by state. NSW and Queensland are in the worst position. The ACT is calculated to have the lowest proportional level of need.</p>
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<iframe src="https://datawrapper.dwcdn.net/efNLj/1/" scrolling="no" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="400"></iframe>
<h2>What does this mean for households in need?</h2>
<p>Housing need is defined as: </p>
<blockquote>
<p>… the aggregate of households unable to access market-provided housing or requiring some form of housing assistance in the private rental market to avoid a position of rental stress. </p>
</blockquote>
<p>This includes potential households that are unable to form because their income is <a href="https://theconversation.com/housing-still-out-of-reach-for-many-even-as-rents-fall-in-post-boom-western-australia-76461">too low to afford to rent</a> in the private rental market. These households would traditionally rely on <a href="https://theconversation.com/australia-needs-to-reboot-affordable-housing-funding-not-scrap-it-72861">public housing</a> and <a href="https://theconversation.com/community-sector-offers-a-solid-platform-for-fair-social-housing-79997">community housing</a> to meet their needs. However, more and more are being <a href="https://www.ahuri.edu.au/policy/ahuri-briefs/percentage-australian-households-in-social-housing-2006-to-2016">forced into the private rental market</a>, paying housing costs they are <a href="https://theconversation.com/drafts/77714/edit">unable to afford</a> without making <a href="https://theconversation.com/rental-housing-policies-trap-children-in-poverty-so-how-low-will-we-go-64111">significant sacrifices</a>. </p>
<p>To 2025, on average 190,000 potential households in NSW will be unable to access market housing in a given year. The graph below is the most revealing as it illustrates the gap between affordable housing demand and supply. </p>
<iframe src="https://datawrapper.dwcdn.net/x5Hxs/2/" scrolling="no" frameborder="0" allowtransparency="true" allowfullscreen="allowfullscreen" webkitallowfullscreen="webkitallowfullscreen" mozallowfullscreen="mozallowfullscreen" oallowfullscreen="oallowfullscreen" msallowfullscreen="msallowfullscreen" width="100%" height="400"></iframe>
<p>The lack of social housing and subsidised rental housing prevents such households forming under affordable conditions. Many will manage to form but will have to spend well over 30% of their income on housing costs to do so, putting them in a position of financial stress. </p>
<p>The results also reveal the increasing pressure the affordable housing shortfall places on the housing assistance budget, notably <a href="https://www.dss.gov.au/housing-support/programmes-services/commonwealth-rent-assistance">Commonwealth Rent Assistance</a>. </p>
<p>The absence of a significant new supply of affordable housing – there has been no large-scale program since the National Rental Affordability Scheme (<a href="https://www.dss.gov.au/our-responsibilities/housing-support/programmes-services/national-rental-affordability-scheme">NRAS</a>) began in 2008 – has left state governments trying to find ways to plug the affordability gap. </p>
<p>Responses have been largely on the demand side, such as first home buyer concessions <a href="https://www.nsw.gov.au/improving-nsw/projects-and-initiatives/first-home-buyers/">recently announced in NSW</a>. But such incentives are no use for low-income households. To help them, intervention needs to be on the supply side. </p>
<h2>How does Australia compare?</h2>
<p>The AHURI research built on ideas emerging from research into housing need in the UK. It revealed interesting differences between the two countries. </p>
<p>UK government policy <a href="http://openaccess.city.ac.uk/16263/">prior to 2010</a> emphasised the role of the planning system in helping to substantially increase affordable housing supply. This reflected evidence from <a href="http://www.tandfonline.com/doi/abs/10.1080/02673037.2011.609327">England</a> and <a href="http://www.gov.scot/Publications/2008/12/17094317/0">Scotland</a> that found a link between low levels of new housing supply and higher and rising house prices.</p>
<p>In this project, we found plenty of evidence of deteriorating housing affordability in Australia. But we did not find a particularly strong relationship between <a href="https://theconversation.com/get-used-to-your-commute-data-confirms-houses-near-jobs-are-too-expensive-77867">housing supply and price growth</a>. This might reflect how other drivers of <a href="https://theconversation.com/what-housing-issues-should-the-budget-tackle-this-is-what-our-experts-say-73751">deteriorating housing affordability</a> are more important in Australia – such as tax incentives for investors. </p>
<p>These findings suggest we need to look more closely at how new supply and investment demand interact, and in what circumstances boosting new supply is likely to improve affordability.</p>
<p>From our analysis of individuals’ labour market circumstances and incomes, it was also clear that the Australian workforce has not escaped the <a href="http://www.oecd.org/social/in-it-together-why-less-inequality-benefits-all-9789264235120-en.htm">erosion of secure, full-time employment opportunities</a> seen in other countries. </p>
<p>The combination of widespread insecure, part-time employment opportunities, high housing costs and low supply of rented social housing means the housing of many working Australians is extremely precarious.</p>
<h2>How was the research done?</h2>
<p>The research modelled housing need at the state and territory level to 2025 using an underlying set of economic assumptions and interrelated models on household formation, housing markets, labour markets and tenure choice. </p>
<p>The models were underpinned by data from the Housing, Income and Labour Dynamics in Australia (<a href="http://melbourneinstitute.unimelb.edu.au/hilda">HILDA</a>) Survey, the Australian Bureau of Statistics (ABS) and house price and rent data. </p>
<p>This research delivers, for the first time in Australia, a consistent and replicable methodology for assessing housing need. It can be used to inform resource allocation and simulate the impact of policy decisions on housing outcomes. </p>
<p>The intention is to further develop the model to assess housing need at the level of local government areas. </p>
<h2>So, what are the policy implications?</h2>
<p>The scale of the affordable housing shortfall requires major action from federal and state governments. </p>
<p>NRAS had its problems but at least <a href="https://www.ahuri.edu.au/__data/assets/pdf_file/0033/9996/Subsidised-affordable-rental-housing-lessons-from-Australia-and-overseas-Executive-summary.pdf">delivered a supply of below-market housing</a>. Australia cannot rely on the private sector to deliver housing for low-income households without some form of government subsidy as it is simply not profitable to do so. </p>
<p>The question is what government is going to be prepared, or even able, to spend big to close the affordable housing supply gap?</p><img src="https://counter.theconversation.com/content/80965/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Steven Rowley is Director of the Australian Housing and Urban Research Institute's Curtin Research Centre. He receives funding from the Australian Housing and Urban Research Institute and the Bankwest Curtin Economics Centre. He is chair of the Housing Industry Forecasting Group in Western Australia</span></em></p><p class="fine-print"><em><span>Chris Leishman receives funding from the Australian Housing and Urban Research Institute (AHURI) and the UK's Economic and Social Research Council (ESRC). He is a co-investigator on the UK's Housing Evidence Centre (CaCHE).</span></em></p>One in seven Australian households is in a state of housing need. A shortfall in social housing supply means some are locked out of the market and others pay much more for rent than they can afford.Steven Rowley, Director, Australian Housing and Urban Research Institute, Curtin Research Centre, Curtin UniversityChris Leishman, Professor of Housing Economics, University of AdelaideLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/781762017-05-31T20:18:31Z2017-05-31T20:18:31ZFamily break-up raises homelessness risk, and critical period is longer for boys<figure><img src="https://images.theconversation.com/files/170926/original/file-20170525-31770-1qrv9af.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Of those who have experienced homelessness, 62% cite family breakdown or conflict as the main reason for becoming homeless for the first time.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/image-vector/illustration-relationship-divorcedivision-property-418364767?src=74-AnYXkCpT7YA3L_onJQw-8-15">shutterstock</a></span></figcaption></figure><p>Australia is going through a <a href="https://theconversation.com/affordable-housing-finger-pointing-politics-and-possible-policy-solutions-75703">well-documented housing affordability crisis</a>. Single parents are especially vulnerable to rising housing costs, as they rely on a single income to provide a decent home for the family. <a href="https://doi.org/10.4225/50/5859e352c3d44">Past research</a> has found that:</p>
<blockquote>
<p>In 2013-14, 46% of … low-income couple families and 67% of one-parent families with dependent children in private rental housing paid more than 30% of their income on rent.</p>
</blockquote>
<p>These families are facing “<a href="https://theconversation.com/rental-housing-policies-trap-children-in-poverty-so-how-low-will-we-go-64111">housing affordability stress</a>”. Taken together, rising housing costs and diminishing family benefits are putting low-income Australian families, and especially those that break down, at risk of intense financial stress, housing insecurity and possibly homelessness. </p>
<p>In my <a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0012/2369919/wp2017n14.pdf">recent research</a> with Jan van Ours, we used a unique dataset of disadvantaged Australians, <a href="http://melbourneinstitute.unimelb.edu.au/journeys-home">Journeys Home</a>, and showed that parental separation increases the risk of becoming homeless. </p>
<h2>Finding the relevant data</h2>
<p>In <a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0012/2369919/wp2017n14.pdf">our study</a>, we used a broad characterisation of homelessness, which seeks to identify situations in which families’ housing conditions do not meet standard requirements to qualify as a “home”. </p>
<p>This is qualitatively similar to the <a href="http://www.abs.gov.au/AUSSTATS/abs@.nsf/Latestproducts/4922.0Main%20Features22012?opendocument&tabname=Summary&prodno=4922.0&issue=2012&num=&view=">Australian Bureau of Statistics’ definition</a>. Homelessness includes: </p>
<ul>
<li><p>sleeping rough or squatting in abandoned buildings;</p></li>
<li><p>staying with relatives or friends temporarily with no alternative; or</p></li>
<li><p>staying in a caravan park, boarding house, hotel or crisis accommodation.</p></li>
</ul>
<p>Parental separation can lead to homelessness in many ways. For example, a separation might require an urgent move, which generates a financial shock. Without enough savings or networks of family and friends to help cover this unexpected expense, low-income parents may be unable to afford secure and safe housing for their family and hence become homeless. </p>
<p>Financial pressure on single-parent households increased again in April when <a href="http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=s1064">legislation</a> that froze or reduced entitlements to several family benefits was passed.</p>
<p>Even less-disadvantaged parents, who may be able to cope financially in the short run (by covering housing costs with their savings, for example), may be unable to do so in the medium run (once those savings run out). They then become homeless a few years after the separation. </p>
<p>Parental separations can also create conflict between parents and children. This may drive children out of their parent’s home and potentially into homelessness in subsequent years.</p>
<h2>What did our research show?</h2>
<p>In the <a href="http://melbourneinstitute.unimelb.edu.au/journeys-home">Journeys Home</a> sample, family breakdown appears to be an important trigger for homelessness. Of those who have experienced homelessness, <a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0007/2202838/Scutella_et_al_Journeys_Home_Research_Report_W1.pdf">62% of respondents</a> cite family breakdown or conflict as the main reason for becoming homeless for the first time.</p>
<p>However, the research linking parental separation and homelessness is scarce. This is because most of the available datasets are not well suited to this purpose. </p>
<p>Disadvantaged populations – that is, people who have experienced homelessness – are underrepresented in general household surveys. And datasets that include only people who are currently homeless fail to capture other segments of the disadvantaged population who might be at risk of homelessness. </p>
<p>In contrast, Journeys Home is unique in that it covers a broad spectrum of the disadvantaged population, not just those currently homeless. In fact, <a href="http://melbourneinstitute.unimelb.edu.au/__data/assets/pdf_file/0007/2202838/Scutella_et_al_Journeys_Home_Research_Report_W1.pdf">75% of respondents</a> were not homeless at the time of the first interview. </p>
<p>At the same time, the high frequency of homelessness and parental separation in the sample provides enough occurrences to help us answer the question of a potential causal relationship between the two. </p>
<p>We exploited Journeys Home’s detailed information on respondents’ histories to investigate whether their parents’ separation (if ever) led to their first experience of homelessness (if ever).</p>
<figure class="align-right zoomable">
<a href="https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=799&fit=crop&dpr=1 600w, https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=799&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=799&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1004&fit=crop&dpr=1 754w, https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1004&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/171098/original/file-20170526-23241-c6tx12.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1004&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">For boys, the critical time in which parental separation increases their future risk of homelessness extends into their teenage years.</span>
<span class="attribution"><span class="source">shutterstock</span></span>
</figcaption>
</figure>
<p>We found that parental separation increases the overall likelihood of becoming homelessness, although the risk for any individual is influenced by the particular characteristics of both the family and the individual. The effect is substantial. </p>
<p>For boys, their risk of becoming homeless by age 30 increases by ten to 15 percentage points. This is irrespective of their age when the separation occurs. </p>
<p>For girls, only parental separation before the age of 12 matters. This increases their likelihood of being homeless before 30 by 15-20 percentage points. </p>
<p>The effects of separation on homelessness are larger when the parents were formally married.</p>
<p>These results constitute a critical first step in understanding how individuals, and in particular children or young adults, become homeless. They highlight the role of parental separation in the process and hence the need to act on the issue of housing affordability for disadvantaged families that break down in order to protect children from poverty and homelessness.</p><img src="https://counter.theconversation.com/content/78176/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>This paper uses unit record data from Journeys Home: Longitudinal Study of Factors Affecting Housing Stability (Journeys Home). The study was initiated and is funded by the Australian Government Department of Social Services (DSS) and was approved by the Human Research Ethics Committee of the University of Melbourne. The Department of Employment has provided information for use in Journeys Home and it is managed by the Melbourne Institute of Applied Economic and Social Research (Melbourne Institute). The findings and views reported in this paper, however, are those of the authors and should not be attributed to DSS, the Department of Employment or the Melbourne Institute. </span></em></p>Parental separation substantially raises the risk of homelessness by the age of 30 for girls and boys, but only boys are affected by a break-up after the age of 12.Julie Moschion, Senior Research Fellow, Melbourne Institute, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/641112016-12-22T01:07:09Z2016-12-22T01:07:09ZRental housing policies trap children in poverty, so how low will we go?<figure><img src="https://images.theconversation.com/files/151205/original/image-20161221-14181-17uoc9s.jpg?ixlib=rb-1.1.0&rect=0%2C370%2C3304%2C2547&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The increasing proportion of children living in housing-related poverty confronts us with the question: what will we do about it?</span> <span class="attribution"><span class="source">Ollyy/shutterstock.com</span></span></figcaption></figure><p>This year Australians have been shocked by <a href="http://www.childabuseroyalcommission.gov.au/getattachment/aedecf42-a5f9-4485-bc08-45f88d79ae23/Safe-and-sound-Exploring-the-safety-of-young-peopl">evidence</a> about the <a href="https://probonoaustralia.com.au/news/2016/12/young-people-feel-unsafe-residential-care/">risks to children in some out-of-home care</a> settings. </p>
<p>We also learned that women and children comprise a <a href="http://www.aihw.gov.au/homelessness/domestic-violence-and-homelessness/">large proportion of Australia’s homeless population</a>. What we know far less about is how some of Australia’s most vulnerable children fare in what our analysis shows is the fastest-growing part of our mainstream housing system: private rental. </p>
<p>In research released today (see the report <a href="https://doi.org/10.4225/50/5859e352c3d44">here</a> or a summary <a href="https://doi.org/10.4225/50/5859e3787bd92">here</a>), researchers at Swinburne University shed light on this question. The study is one of the first of its type in Australia to enumerate children and young people’s housing disadvantage. </p>
<p>With <a href="http://www.ahuri.edu.au/__data/assets/pdf_file/0012/2208/AHURI_Final_Report_No232_Generational-change-in-home-purchase-opportunity-in-Australia.pdf">home ownership rates falling and social housing in short supply</a>, the private rental sector now houses one in four households and one in three Australians. We calculate that, in 2013-14, this included 1,037,802 families with dependent children and young people. So, what kind of childhood does private rental – and the policy settings that shape it – provide? </p>
<p>The Australian Bureau of Statistics’ <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6553.0">Survey of Income and Housing</a> and <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/2011.0">Census of Population and Housing</a> are used to examine children and young people’s exposure to affordability stress, using a rent-to-income ratio. This shows the proportion of income (adjusted for family size) that lower-income families with dependent children spend on rent. The study focused on children in the very lowest-income families (lowest 20%) and next-lowest (second-lowest quintile). </p>
<h2>So what did the study find?</h2>
<p>The findings are bleak. In 2013-14, 46% of these low-income couple families and 67% of one-parent families with dependent children in private rental housing paid more than 30% of their income on rent – the point above which it is considered difficult to make ends meet.</p>
<p>Using a child-focused method to establish how many children are exposed to unaffordable private rental housing in 2003-4 and 2013-14, the study shows:</p>
<ul>
<li><p>183,500 children (0–14 years old) in low-income (bottom 40%) couple-headed families in private rental dwellings live with housing affordability stress. This is an increase of five percentage points since 2003-04 (42%).</p></li>
<li><p>158,300 children (0-14) in low-income (bottom 40%) one-parent families in private rental dwellings are in housing affordability stress (67%).</p></li>
</ul>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=501&fit=crop&dpr=1 600w, https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=501&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=501&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=629&fit=crop&dpr=1 754w, https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=629&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/151133/original/image-20161221-13163-18oevdx.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=629&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Rises in proportions of low-income families (bottom 40% of incomes) with children aged 0-14 that are paying unaffordable rent.</span>
<span class="attribution"><span class="source">Original analysis ABS Survey of Income and Housing, 2003-04, 2013-14</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Risk factors for childhood exposure to rental affordability stress include: living in a low or very low-income family; living in a single-parent low-income family; being a young child (0-14, rather than 15-18) in a low-income family; and living with a low-income parent born overseas.</p>
<p>Using Victoria to illustrate the spatial risks, we find that living in regional areas provides some rent relief, but not as much as it used to. Findings show:</p>
<ul>
<li><p>only one in ten children aged 0–14 in lowest-income families (bottom 20%) in metropolitan Melbourne are living with affordable rent levels, so nine in ten are not (91%); and</p></li>
<li><p>three in ten children aged 0–14 in lowest-income families (bottom 20%) in regional Victoria are living with affordable rent levels, so seven in ten are not (69%).</p></li>
</ul>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=489&fit=crop&dpr=1 600w, https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=489&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=489&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=614&fit=crop&dpr=1 754w, https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=614&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/151306/original/image-20161221-4056-7ls2r1.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=614&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
<figcaption>
<span class="caption">Percentages of children living in low-income households paying unaffordable rent across Victoria.</span>
<span class="attribution"><span class="source">ABS Census of Population and Housing, 2006, 2011</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>Related evidence indicates that:</p>
<ul>
<li><p>private rental conditions represent some of the <a href="https://www.ahuri.edu.au/__data/assets/pdf_file/0020/5762/AHURI_Final_Report_No259_Accessing_and_sustaining_private_rental_tenancies_critical_life_events_housing_shocks_and_insurances.pdf">least secure, affordable and sustainable housing</a> for families with children;</p></li>
<li><p>families with children make up 30% of private renters who <a href="https://www.ahuri.edu.au/__data/assets/pdf_file/0013/2227/AHURI_Final_Report_No209_Long-term-private-rental-in-a-changing-Australian-private-rental-sector.pdf">rent for more than ten years</a>; and</p></li>
<li><p>precarious housing <a href="https://theconversation.com/slippers-and-stickers-the-hidden-victims-of-rising-house-prices-42816">leads to locational disadvantage</a>. </p></li>
</ul>
<h2>What can be done about this?</h2>
<p>While many families are struggling privately to navigate the effects of unaffordable housing while raising their children, these findings raise the important question: where does housing governance lie? </p>
<p>Current housing policy settings are not working for children, young people and their families. The almost-but-not-quite changes at the 2016 election to target negative gearing – in order to increase the affordable housing supply via tax reform – might have brought some relief to the lowest-income families in the rental sector. But what of the conditions of short-term leasing and <a href="https://theconversation.com/where-do-record-rental-prices-leave-low-income-earners-57628">run-away rents</a>?</p>
<p>A wide-ranging <a href="http://fairersaferhousing.vic.gov.au/renting">review of tenancy legislation</a> in Victoria is underway. This offers some hope of reforms that will assist children and young people in our mainstream housing system. Secure leasing, rent increases and housing quality are under review. </p>
<p>In <a href="http://www.fairtrading.nsw.gov.au/ftw/About_us/Have_your_say/Residential_tenancy_laws_review.page">New South Wales</a> and some other states, moves are also afoot to improve housing conditions for tenants. </p>
<p>The findings of our new research suggest these reforms are necessary but not sufficient to alleviate childhood exposure to rent-related poverty.</p>
<p>Our findings also point to the need to:</p>
<ul>
<li><p>revisit negative-gearing reform;</p></li>
<li><p>evaluate the effectiveness of Commonwealth Rent Assistance;</p></li>
<li><p>provide adequate income support for families; and</p></li>
<li><p>potentially reinvest in innovative forms of socially supported housing fit for families’ 21st-century housing needs.</p></li>
</ul>
<p>Ultimately, the <a href="http://www.acoss.org.au/media_release/child-poverty-on-the-rise-730000-children-in-poverty/">increasing proportions</a> of Australia’s children living in housing-related poverty must force us all to consider the questions: who is responsible for the problem? And what will we do about it?</p><img src="https://counter.theconversation.com/content/64111/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Wendy Stone receives funding from the Australian Housing and Urban Research Institute (AHURI), the Australian Research Council (ARC) and the Lord Mayor's Charitable Foundation.</span></em></p><p class="fine-print"><em><span>Margaret Reynolds receives funding from the Australian Housing and Urban Research Institute (AHURI), the Australian Research Council (ARC) and the Lord Mayor's Charitable Foundation.</span></em></p>Many children are living in low-income families that struggle to pay the rent to keep a roof over their heads. Unaffordable housing is fuelling childhood poverty, so where is the policy response?Wendy Stone, Associate Professor; Director, Australian Housing and Urban Research Institute, Swinburne University of TechnologyMargaret Reynolds, Researcher, Swinburne University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/428162015-06-04T20:08:40Z2015-06-04T20:08:40Z‘Slippers’ and ‘stickers’: the hidden victims of rising house prices<figure><img src="https://images.theconversation.com/files/83918/original/image-20150604-11749-18dr9bl.jpg?ixlib=rb-1.1.0&rect=7%2C201%2C1214%2C881&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">"Stickers" find themselves caught in unaffordable housing. </span> <span class="attribution"><span class="source">Author provided</span>, <span class="license">Author provided</span></span></figcaption></figure><p>Australia needs to have a housing conversation that isn’t just about housing “bubbles”, profits and investment properties. Sadly, we punch well above our weight in international measures of poor housing affordability, and increasing numbers of Australians can’t afford their rents or mortgages. </p>
<p>Even a modest increase in house prices will make things even tougher for these Australians – but importantly, do we reliably know who they are, where they live, and how extreme their affordability problems are? </p>
<p>Our <a href="http://www.tandfonline.com/doi/full/10.1080/08111146.2015.1034853">new research</a> reveals some poorly understood distinctions in unaffordable housing. Some people appear to be “slipping” in and out of housing affordability problems, while others remain “stuck” with them for long periods, or even a lifetime. </p>
<p>When we look at housing affordability in this way and compare these two groups of people, these “slipper” and “sticker” groups are shown to be very different within Australian society, with different intervention needs implied. </p>
<h2>Limitations of the 30/40 rule</h2>
<p>To address housing affordability and target assistance we usually rely on data on the prevalence and nature of unaffordable housing. The most widely used measures of housing affordability are based on simple ratios, for example, the 30/40 measure. This approach classifies people as being in unaffordable housing if they are in the lower 40% of the income distribution and their rent or mortgage payments exceed 30% of their income. </p>
<p>Such a simple, straightforward measure - that classifies people as being either in unaffordable housing or not – is undoubtedly useful, and outside of the housing research community, data using these measures are rarely questioned. But it’s useful to think about that data a little more critically. </p>
<p>The picture of housing affordability portrayed by most of the measures we (and policy makers) rely on is a snapshot – a point-in-time collection of people’s ability to afford their housing (on Census night for example). Importantly, it’s a very blunt measure. In fact, when we look more closely at people’s experience of affordability problems we see that the snapshot is a pretty poor predictor of longer-term unaffordability.</p>
<p>For a great many households, both income and housing costs - and where they sit relative to other households - change a lot over time. This causes people to slip in and out of unaffordable housing. In a large Australian sample, we see that hidden within the segment of the population classified as being in unaffordable housing in any one year, fewer than half were classified in the same way the next year. Because the total number of people counted in unaffordable housing is stable, it points to a limitation in the way that we measure housing affordability. </p>
<h2>Slippers and stickers</h2>
<p>By following people’s income and housing costs each year for a five year period, we classify stickers as being in unaffordable housing (using the 30/40 rule) in every one of the five years. To be classified as a slipper, people must have made at least one transition into, and one out of, unaffordable housing over the five year period. Slippers outnumber stickers three to one, and therefore affordability initiatives may be more concentrated upon the needs of slippers. </p>
<p>Compared to slippers, stickers have much lower incomes and employment rates. Around 60% of stickers have a disability, and stickers are twice as likely as slippers to be carers for other people in their household. Looking deeper, three quarters of those stuck for long periods in unaffordable housing are women, they also tend to be much older than slippers, and more likely to live alone.</p>
<p>This description points to what some might call a vulnerable group of people or even an “underclass” perpetually facing housing affordability issues and, most likely subject to the consequences of this, such as limited financial resources and stress.</p>
<p>It is interesting to note that the characteristics of the sticker population are very similar to those of Australia’s public housing tenant population, but because public housing largely addresses affordability by rent capping, stickers are most likely to be private renters and low income mortgage holders. </p>
<p>This means that, in addition to being highly vulnerable, many stickers are likely to receive little or no government assistance with their housing costs. It also implies a pressing need to improve the supply and affordability of housing in the private sector - via the taxation system or the land supply system. </p>
<p>Rather than looking at housing affordability as one problem, the distinct differences observed between Australia’s slippers and stickers imply a need to focus particular attention and interventions on stickers. We also need to better understand how people enter and exit unaffordable housing and what we can do to prevent people becoming stuck. </p>
<p>In the bigger picture our findings describe real social inequalities in Australia that are present and persistent. It reminds us that the conversation we need to have about housing affordability in Australia isn’t just about the positives of “housing bubbles”, but also needs to be about how to address the serious affordability problems of the growing group of (often already vulnerable) Australians who are stuck.</p><img src="https://counter.theconversation.com/content/42816/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Emma Baker receives funding from the Australian Research Council FT140100872.</span></em></p><p class="fine-print"><em><span>Rebecca Bentley receives funding from the Australian Research Council and National Health and Medical Research Council. </span></em></p>New research into affordable housing reveals some poorly understood distinctions that deserve great policy scrutiny.Emma Baker, Reader in Housing, University of AdelaideRebecca Bentley, Senior lecturer, The University of MelbourneLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/402112015-04-15T09:45:28Z2015-04-15T09:45:28ZTories offer the dream of home ownership – but do Britons want it any more?<p>The Conservative Party has <a href="https://s3-eu-west-1.amazonaws.com/manifesto2015/ConservativeManifesto2015.pdf">pledged</a> to extend the Right-to-Buy scheme to housing association tenants in England, offering discounts worth tens of thousands of pounds depending on length of tenancy and where you live.</p>
<p>Could this new announcement, which David Cameron <a href="http://news.sky.com/story/1464642/pm-promises-good-life-for-working-people">claims</a> proves that the Conservatives “are the party of working people, offering you security at every stage of your life”, be an appealing prospect for England’s most disadvantaged young people? After all, they may well be the least likely to ever get a foothold in the property market.</p>
<p>The latest <a href="http://www.natcen.ac.uk/our-research/research/the-reality-of-generation-rent/">Generation Rent</a> report found that 39% of 20-45 year-olds either don’t know or haven’t decided whether the current Help to Buy and New Buy schemes have had a positive impact on the first time buyer market.</p>
<p>Despite increased assistance for first-time buyers over the past few years, our research found that the proportion of young people who don’t want to own a home increased over the last five years. At the same time the proportion of those who are likely to become first-time buyers has fallen over the same period. </p>
<p>The proportion of young people who are saving to buy a property has fallen by six percentage points since 2011. This drop could be because young people no longer see the point in saving for a deposit; our findings show that high property prices, the size of the deposit required and low income were the three most significant barriers to buying a property for young people.</p>
<h2>Giving up on buying</h2>
<p>The combination of high property prices and years without real-terms wage growth means that young people are unable to save the amount required for a deposit or to get a big enough mortgage to buy a property. The time it takes to save for a deposit has jumped, from an average of 3.6 years in 2011 to 5.35 years in 2014. The Generation Rent report found that 65% of young people reported being put off applying for a mortgage due to fear of being turned down (an increase of 10 percentage points from 2011). Nearly 80% believed banks do not want to lend to first-time buyers, and 21% believed it is virtually impossible for first-time buyers to obtain a mortgage.</p>
<p>With this in mind, could extending the Right-to-Buy scheme to housing association tenants in England help improve the situation for aspiring young homeowners who currently find themselves in social housing?</p>
<p>Enabling people who live in council or other social housing to purchase their homes at a <a href="https://www.gov.uk/right-to-buy-buying-your-council-home/discounts">discounted rate</a> would certainly help to eliminate two of the three biggest barriers that young people face – namely high property prices and the size of the deposit required – and could help this disenfranchised group become homeowners.</p>
<h2>Forgotten renters</h2>
<p>Cameron’s announcement may help to reinvigorate enthusiasm for home-ownership among a section of young people but what about those who are not in social housing and those waiting for years to get a council house? An already depleted pool of social housing has played a part in forcing young people into the private rental sector, with 49% of those aged 16-34 in this category, overtaking the number of owner occupiers in that age group in 2011-12. </p>
<p>Between 2003-04 and 2013-14, the proportion of younger households in the private rented sector more than doubled. This new announcement will not help those who are privately renting and unable to buy a home, and may serve to alienate them and create resentment towards those in social housing.</p>
<p>The government’s existing Help-to-Buy initiative has clearly not helped change young people’s perceptions and experiences of the housing market. Despite this, the extended policy will undoubtedly be an attractive proposal to some social housing tenants, and may provoke a last minute change of heart from some traditional Labour supporters to vote Conservative. Whether this scheme will change young people’s attitudes to home-ownership remains to be seen.</p><img src="https://counter.theconversation.com/content/40211/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Nevena Ilic works for NatCen Social Research.</span></em></p>Cameron’s pledge may help some in social housing, but it offers no hope for everyone else who’s locked out of the market.Nevena Ilic, Researcher, National Centre for Social ResearchLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/322252014-11-05T03:37:28Z2014-11-05T03:37:28ZMove over, McMansions – the tiny house movement is here<figure><img src="https://images.theconversation.com/files/63233/original/sqmz63dv-1414623548.jpg?ixlib=rb-1.1.0&rect=21%2C0%2C4638%2C2643&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Who needs a big garden when you've got this?</span> <span class="attribution"><a class="source" href="https://www.facebook.com/tinyabodes">The Tiny Abode Co.</a>, <span class="license">Author provided</span></span></figcaption></figure><p>A small group of people is gathered around a campfire in a Victorian State Forest. Members of the <a href="https://www.facebook.com/TinyHousesAustralia">Tiny Houses Australia community</a>, they’re attending a Spring Camp to talk about how to build a tiny house, and compare notes on how to address common barriers, like local government planning schemes. </p>
<p>The group is diverse, from students to professionals and retirees. One has been living temporarily in caravans. Others were forced to move into shared accommodation or board with family. Most have given up on the idea of buying their own home, put off by the high price tag or the size of the mortgage, or the downside of living far from family or employment. </p>
<p>Most of the group are also fierce promoters of a more sustainable, minimalist way of life who want their new houses to reflect this. You won’t find many en suites or walk-in wardrobes in their floor plans. </p>
<h2>Is bigger really better?</h2>
<p>Something is wrong when <a href="https://au.news.yahoo.com/thewest/a/25372224/170k-family-priced-out-of-perth/">a professional earning A$170,000</a> cannot afford to live close to work; or <a href="http://www.smh.com.au/business/property/firsthome-crisis-triggers-call-for-action-20131115-2xmcv.html">a doctor needs a parental loan</a> to buy a house. All 25 major urban housing markets in Australia are ranked as <a href="http://www.demographia.com/dhi.pdf">severely unaffordable</a>; and Australia has the <a href="http://www.imf.org/external/research/housing/index.htm">second most unaffordable</a> housing market among member nations of the Organisation for Economic Co-operation and Development (OECD). </p>
<p>Australian houses are also <a href="http://www.demographia.com/dhi.pdf">among the largest</a> in the OECD. In 2008, the average new house was 214 square metres, double the size of an average 1950s house. Very large houses are not only more expensive, but environmentally unsustainable. For example, the major factors that determine a house’s greenhouse gas emissions are its size and location; the bigger and more isolated the house, <a href="http://link.springer.com/article/10.1007/s10901-011-9212-2#page-1">the larger its emissions</a>. </p>
<p>For many, particularly young people entering the market and older people leaving the workforce, the “great Australian dream” of a big house on a quarter-acre block is a distant fantasy. And even for those who are living the dream, a sudden interest-rate rise, job loss or chronic illness could rapidly turn it into a nightmare. </p>
<p>Regardless of the debate over whether we’re in a <a href="https://theconversation.com/memo-to-the-imf-there-is-no-housing-bubble-27925">housing bubble</a>, the affordability problem is much broader than property prices. The most serious issue is the lack of affordable <a href="http://onlinelibrary.wiley.com/doi/10.1111/j.1467-8462.2008.00502.x/full">rental accommodation</a>.</p>
<h2>Finding sanctuary in a tiny house</h2>
<p>From this backdrop has emerged a trend towards <a href="http://www.bloomberg.com/news/2014-07-09/tiny-houses-big-with-u-s-owners-seeking-economic-freedom.html">building much smaller houses</a>. The <a href="http://en.wikipedia.org/wiki/Small_house_movement">tiny house movement</a> originated in the United States in the late 1990s, largely in response to problems with housing affordability, although it has also been spurred on by the <a href="https://theconversation.com/au/topics/global-financial-crisis">global financial crisis</a> and a widespread desire to live more sustainably. The movement has now spread to New Zealand, Australia and Canada. </p>
<p>Tiny houses are generally smaller than 40 sq m, and <a href="http://www.businessinsider.com.au/beautiful-tiny-homes-2014-8#this-60-square-foot-home-is-the-smallest-house-in-the-uk-16">can take many forms</a>, from granny flats, to repurposed shipping containers, to a <a href="http://www.huffingtonpost.ca/2014/03/21/tiny-house-on-wheels-abbotsford_n_5003376.html">complete houses built on trailers</a>. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=419&fit=crop&dpr=1 600w, https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=419&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=419&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=527&fit=crop&dpr=1 754w, https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=527&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/63676/original/m36s92m7-1415151376.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=527&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">Room to manoeuvre: some tiny houses have wheels - just don’t call them caravans.</span>
<span class="attribution"><span class="source">The Tiny Abode Co.</span>, <span class="license">Author provided</span></span>
</figcaption>
</figure>
<p>The benefits of tiny houses include <a href="http://tinyhousebuild.com/tiny-houses-infographic">overall sustainability</a>, reduced energy and water use (tiny houses are often “off the grid”) and, of course, affordability. Some tiny houses can cost less than A$10,000. Moreover, they <a href="http://onlinelibrary.wiley.com/doi/10.1162/1088198054084680/abstract">use significantly less resources</a> to build, and are often constructed from salvaged materials or sustainably sourced products.</p>
<p>Mobile tiny houses could even help their inhabitants adapt to climate change; a house on wheels can be moved out of danger from floods or storm surges. They can allow adult children or aged parents to live independently, yet maintain access to family, employment and public transport. </p>
<p>Tiny houses can even address aspects of homelessness. In the United States, some local governments are donating land for <a href="http://www.huffingtonpost.com/2014/10/27/greensboro-north-carolina-tiny-homes_n_6054590.html?ir=Impact">homeless people to build their own tiny homes</a>.</p>
<h2>The biggest issues with a tiny house</h2>
<p>Although <a href="https://www.facebook.com/TinyHouseBlog">information is plentiful</a> on building techniques, plans and design, it is not very easy to build a tiny house. However, as attendees at the Spring Camp agreed, perhaps the biggest problem with building a tiny house is finding a place to put it. </p>
<p>Tiny houses do not conform to many <a href="http://www.berkeleyside.com/2011/01/07/a-city-looks-for-big-solutions-in-a-little-very-little-house">local government planning schemes</a> or building codes, which mandate minimum house sizes, maximum number of houses per plot, connection to utilities, parking provisions, and restrictions on temporary occupation. </p>
<p>It might also be argued that allowing tiny houses will reduce land values and lead to health and safety concerns, such as overcrowding. But people currently live in crowded conditions or illegally in sheds or caravans. </p>
<p>Some states, such as New South Wales, allow property owners to build <a href="http://www.planning.nsw.gov.au/Portals/0/plansforaction/affordablehousing/docs/Affordable%20Housing_Fact_Granny%20Flats.pdf">granny flats</a>. In other states, the regulations differ between and within each local government, although almost
almost all have restrictions on the duration of temporary occupation.</p>
<p>For non property-owners, particularly those who don’t want to take any legal risks, the options are fewer. And of course, local governments can and should impose planning restrictions on tiny houses, and ensure that they comply with building codes and standards. </p>
<p>Tiny houses are not for everyone. They will probably <a href="http://lup.lub.lu.se/luur/download?func=downloadFile&recordOId=4196241&fileOId=4196242">always remain a niche market</a>, more suited to people with no children, or retirees. </p>
<p>Niche, yes, but for some people tiny houses could be a lifeline. Being unable to afford to buy property, fulfil mortgage commitments, or even rent a home can lead to <a href="http://journals.cambridge.org/action/displayAbstract?fromPage=online&aid=1046376&fileId=S0033291706009767">mental and physical illness</a>. In a sustainable city, everyone should be able to <a href="http://www.tandfonline.com/doi/abs/10.1080/0811114032000147430#.VFB38vmUd8E">access affordable housing</a>, and a tiny house is certainly better than no house at all.</p><img src="https://counter.theconversation.com/content/32225/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Heather Shearer is a member of the Greens Party, 350 Org and the Tiny Houses Australia Facebook Group. </span></em></p>A small group of people is gathered around a campfire in a Victorian State Forest. Members of the Tiny Houses Australia community, they’re attending a Spring Camp to talk about how to build a tiny house…Heather Shearer, Research Fellow, Urban Research Program, Griffith UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/139372013-05-08T20:53:59Z2013-05-08T20:53:59ZJust how stressed are we when it comes to housing affordability?<figure><img src="https://images.theconversation.com/files/23356/original/mmq3zdmj-1367992321.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Calculating a household's residual income is a more accurate measure of housing stress.</span> <span class="attribution"><span class="source">Image from www.shutterstock.com</span></span></figcaption></figure><p>Property pundits are hoping the Reserve Bank of Australia’s latest cut to interest rates will help stoke the country’s flat property sector into life.</p>
<p>But Australia’s housing remains highly over-valued, <a href="http://www.demographia.com/dhi.pdf">according to some sources</a>, with worryingly high levels of <a href="https://theconversation.com/the-truth-behind-our-dangerous-public-debt-levels-13245">private debt carried by households</a>, particularly mortgage debt.</p>
<p>A high proportion of households consider themselves under housing stress; but this is something that is surprisingly hard to define. </p>
<p>The common benchmark for housing stress in Australia is <a href="http://www.abs.gov.au/ausstats/abs@.nsf/Lookup/4125.0main+features1310Jan%202013">a ratio of 30%</a> of income spent on housing. </p>
<p>This is a misleading measure of housing affordability because it does not distinguish those on the brink of homelessness from those who can afford and choose to spend more than 30% of their incomes on high-quality housing. </p>
<p>An alternative is to calculate a household’s “residual income” – the difference between disposal income and actual housing costs. </p>
<p>The “residual income” measure can be used together with <a href="http://sam.arts.unsw.edu.au/media/File/DSS_Report74_BudgetStandards.pdf">Indicative Budget Standards for Australia</a>, which are designed for benchmarking the poverty line components of expenditure for different types of households at a given point in time. </p>
<p>If we omit poverty-line housing costs from these budget standards and compare them with the residual income of households, we can identify the type of households for whom residual incomes are below the budget standards without poverty line housing costs. These people are in housing stress because they cannot afford non-housing necessities after they have met their current housing costs. </p>
<p>The residual housing stress measure is easy to apply, because <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6540.0/">detailed data sets</a> are available from Australian Bureau of Statistics Expenditure and Housing Surveys, as well as the more detailed <a href="http://www.melbourneinstitute.com/hilda/">HILDA household surveys</a> conducted by the Melbourne Institute.</p>
<p>This is a more effective measure of housing affordability in several ways. The ratio approach applies the same percentage figure for every household type. The residual income measure uses benchmarks that vary for each household type, with an allowance made for changes in budget constraints and the fixed nature of housing costs in the short term. This makes it easier to develop policies that are targeted more effectively at issues of housing poverty. </p>
<p>For example, migrants and unemployed people are more likely to be in housing stress than those born in Australia and employed. Reducing barriers to social exclusion and helping migrants to find jobs would be effective policy against housing stress. </p>
<p>Policies such as the first home owner grants and <a href="http://www.ato.gov.au/individuals/pathway.aspx?pc=001/002/066">first home saver accounts</a>, assume homeowners will be in a better financial situation than renters, especially in the long run. Money spent on buying a residential property may be recouped when it is sold or used as a mortgage-free residence. Tenants do not get a return on their rent payments. However, such policies may be flawed if households are unable to sustain repayments over the period of their home loan. </p>
<p>In fact, households repaying mortgages are more likely to be in housing stress than those that are paying rent in the private market. (Although public housing tenants, who pay 25% of their income in rent, can often be classified as not being in housing stress.)</p>
<p>Both the first home owner grants and first home saver accounts, which are topped up by the government, add an inflationary component to property prices and may create an illusory hope among vulnerable households on the relative ease of the first step into buying property. Policies that provide industry incentives to increase the supply of properties for both owner-occupation and rental would be more effective.</p>
<p>The use of a residual approach may also be more relevant to public housing tenants. Unfortunately, the use of the ratio approach has discouraged research into the affordability of public housing. </p>
<p>While private sector rents are set by market forces, public housing tenants pay 25% of their income in rent, which is below the 30% threshold and results in them being classified as not in housing stress.</p>
<p>The residual approach measures a household’s ability to consume a basic level of non-housing goods. The measure captures the stress experienced by households as changing circumstances (such as an increase in family size) require increased spending on non-housing items.</p>
<p>While the overall impact on the housing affordability in these two housing sectors is uncertain, use of the residual income approach reveals that in the past 10 years, the incidence of housing stress has shifted from private to public sector tenants. </p>
<p>This suggests that federal and state governments would be advised to consider changes in the ways that welfare benefits and public sector rents are structured.</p><img src="https://counter.theconversation.com/content/13937/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Luc Borrowman receives funding from The Australian Housing and Urban Research Institute (AHURI) in the form of a top-up scholarship.</span></em></p><p class="fine-print"><em><span>Gennadi Kazakevitch and Lionel Frost do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Property pundits are hoping the Reserve Bank of Australia’s latest cut to interest rates will help stoke the country’s flat property sector into life. But Australia’s housing remains highly over-valued…Gennadi Kazakevitch, Deputy Head, Department of Economics, Monash UniversityLionel Frost, Associate Professor of Economics, Monash UniversityLuc Borrowman, PhD student in Economics, Monash UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/94842012-09-20T01:54:14Z2012-09-20T01:54:14ZHousing stress and energy poverty – a deadly mix?<figure><img src="https://images.theconversation.com/files/15462/original/cw4gkdqb-1347593262.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Housing stress and energy poverty are compromising the health of low-income Australians.</span> <span class="attribution"><span class="source">onecellotheory/Flickr</span></span></figcaption></figure><p>The well-being of low-income Australian households is being seriously undermined by the increasing cost of housing and electricity. Many such households are suffering from both housing stress and energy poverty. </p>
<p>Housing stress occurs when low-income households (the bottom 40% of households) use about a third of their income to pay for accommodation. Energy poverty, we suggest, occurs when low-income households spend 10% or more of after-tax income on household energy bills, in addition to rent or mortgage payments. </p>
<p>No Australian studies have examined the link between housing stress and energy poverty, and its effect on well being. But findings from <a href="http://search.informit.com.au/documentSummary;dn=656764580142785;res=IELHSS">our current research</a> suggest that they often go hand-in-hand, and financial hardship is an ever present reality in the households concerned.</p>
<h2>The extent of housing stress</h2>
<p>The data on housing stress alone is well developed. The COAG Reform Council’s <a href="http://www.coagreformcouncil.gov.au/reports/housing.cfm">annual report</a> on the state of housing in Australia, paints a dismal picture. In 2009-2010, 42% of low-income households in the private rental market were suffering from housing stress, up from 37% in 2007-08. </p>
<p>More than half of private renters in the lowest 10% of households by income were in housing stress during this period. The same report concluded that in 2009-10, 37% of low-income households with a mortgage were also suffering from housing stress.</p>
<h2>The extent of energy poverty</h2>
<p>The proportion of low-income households suffering from energy poverty is less clear. What is evident is that increases in electricity prices have far outstripped inflation and wage increases. </p>
<p>An Australia-wide snapshot of average electricity price increases over the past five years shows that New South Wales household electricity prices rose 80%, Queensland, South Australia and Tasmania by 60%, and in Western Australia by 57%. Over the same period the <a href="http://www.abs.gov.au/ausstats/abs@.nsf/mf/6401.0">Consumer Price Index</a> rose by 14.5%, and average weekly earnings by over a quarter.</p>
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<img alt="" src="https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/15463/original/z5bw7ny2-1347593425.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A larger portion of disposable income is being spent on energy bills.</span>
<span class="attribution"><span class="source">Alskai/Flickr</span></span>
</figcaption>
</figure>
<p>So now an increasing number of low-income households are suffering from energy poverty. <a href="http://abs.gov.au/AUSSTATS/abs@.nsf/DetailsPage/4442.0.55.0012009-10?OpenDocument">Australian Bureau of Statistics</a> data show that in 2009-2010, the lowest 20% of Australian households had an average weekly income of $314. Their average expenditure on household energy was 7% of disposable income – three times more than the wealthiest households. These figures don’t take account of the more recent substantial electricity price increases. </p>
<p>Indeed, our research signals that much higher proportions are now being paid. This partly confirms the <a href="http://www.ipart.nsw.gov.au/Home/Industries/Electricity/Reviews_All/Retail_Pricing/Changes_in_regulated_electricity_retail_prices_from_1_July_2011/14_Jun_2011_-_Final_Report/Final_Report_-_Changes_in_regulated_electricity_retail_prices_from_1_July_2011_-_June_2011">NSW Independent Pricing and Regulatory Tribunal’s</a> recent estimate that 5% of Sydney households, and 8% of households in country New South Wales were paying more than 10% of disposable income on electricity bills. </p>
<p>In Victoria, electricity and gas bills have been found to be the greatest cause of <a href="http://epubs.scu.edu.au/cgi/viewcontent.cgi?article=1111&context=jesp">rental arrears</a> (63% of cases). And the ABS found nearly 40% of the two lowest household income groups were unable to pay electricity, gas or telephone bills on time during 2010. </p>
<h2>The toll on well-being</h2>
<p>There’s growing evidence that the combination of housing and energy stress can have serious impacts on health. Since mid-2000, the not-for-profit sector has provided snapshots of such difficulties as low-income households cut back on essentials in order to pay for electricity. </p>
<p><a href="http://www.abc.net.au/news/2012-06-14/energy-hike/4069678">The Salvation Army</a> recently found that in regional New South Wales, just over half the people are going without meals to pay for electricity. A third of these people could not afford to heat their homes. </p>
<p>In 2010, the <a href="http://www.wesleymission.org.au/Research/Financial_Stress/Report/Online%20report/The%20Wesley%20Report%20Oct%202010.pdf">Wesley Mission</a> concluded that more than two-thirds of financially stressed households were making sacrifices to meet electricity price increases, and 10% were unable to meet the cost.</p>
<p>Research by <a href="http://acoss.org.au/images/uploads/AJSI_Vol423.pdf">one of the authors</a> on older private renters under housing stress found the impact was often devastating; interviewees told of how they were unable to feed themselves adequately or replace essential items. </p>
<figure class="align-right ">
<img alt="" src="https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=237&fit=clip" srcset="https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=800&fit=crop&dpr=1 600w, https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=800&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=800&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1005&fit=crop&dpr=1 754w, https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1005&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/15464/original/9jkcqx5x-1347593801.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1005&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">In some instances, housing stress and energy poverty are forcing people to skip meals.</span>
<span class="attribution"><span class="source">andreeapl/Flickr</span></span>
</figcaption>
</figure>
<p>Social isolation was also a common problem. After paying for accommodation, electricity and telephone, there was no money left to engage in the world. As one interviewee said, “Well you sort of think what you can do with $2.50 [the cost of a public transport day pass]. That’s a loaf of bread type of thing.” </p>
<p>Besides the physical implications of inadequate nutrition, the psychological implications of housing stress and energy poverty can be profound. Many of the interviewees were plagued by constant anxiety and depression was common. The not-for-profit sector is also reporting that these impacts of housing stress and energy poverty are becoming more widespread. </p>
<p>These are “real” live consequences of public policies on Australia’s 3.5 million low-income households. And they are, for the large part, being ignored by the political debate.</p><img src="https://counter.theconversation.com/content/9484/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alan Morris is affiliated with the University of New South Wales </span></em></p><p class="fine-print"><em><span>Lynne Chester has received funding from the Australian Energy Market Commission (Consumer Advocacy Panel) for a project investigating the impacts of higher electricity prices on low-income households.</span></em></p>The well-being of low-income Australian households is being seriously undermined by the increasing cost of housing and electricity. Many such households are suffering from both housing stress and energy…Alan Morris, Senior Lecturer, School of Social Sciences, UNSW SydneyLynne Chester, Department of Political Economy, University of SydneyLicensed as Creative Commons – attribution, no derivatives.