Housing affordability in the Netherlands: the impact of rent and energy costs

Energy costs have been rising as well as rents, both in the Netherlands and elsewhere, leading to situations commonly described as ‘housing poverty’ and ‘fuel or energy poverty’. A dwelling may be unaffordable on at least two counts: rents or energy costs that are ‘too high’ in relation to income (excluding cases of ‘too low’ income). This paper measures comprehensively for the first time housing affordability of tenants in the Netherlands with respect to rent and fuel in order to gain insight in the ways this ongoing budgetary commitment can be calculated. Starting point is the expenditure-to-income ratio, which is usually used in the Netherlands to represent the affordability of housing consumption. For 2012 its components—incomes, rents and fuel costs—are separated out. The absence of a socially acceptable benchmark for ‘affordable’ versus ‘unaffordable’ housing and the fact that lower-income households pay relatively more on rent and energy than those with a higher income (Engel’s Law) call for an alternative method to measure affordability. The residual income approach is shown to be useful in identifying households with housing and energy affordability problems, once social norms have been established for the relationship between income, rent and energy expenses. It is concluded that even energy expenses by themselves can push households over the affordability threshold, in the situation where rents are considered as affordable.     

Views of a Developing Region

The objective pf Santa Monica's rent control law, in effect since 1979, is to protect renters —particularly “the poor, minorities, students, young families and senior citizens” — from rapidly rising rents. Comparing 1987 and 1979 tenant surveys indicates that the rent control ordinance has fulfilled some of its goals. Length of tenure has increased, while lower-income tenants and the elderly have benefited most. In addition, the law may have contributed to stopping the decline in households with children. However, it has not stopped a decline in the proportion of black and Latino households. The results suggest that the vacancy control provision of the ordinance is the major factor offering protection to tenants. Since rent control does not increase the supply of affordable rental units nor prevent housing discrimination, it should be viewed as one of a number of housing policy strategies for maintaining affordable housing for specific target populations.     

江西省：以民为本 保障房建设成效卓然

江西省保障性安居工程取得显著成效。近年来,累计解决64万余户城镇家庭住房困难、惠及人口近200余万,初步构建了廉租住房、经济适用住房、公共租赁住房、普通商品住房互为补充的梯级住房供应和保障体系。     

Housing Policy Towards the Rental Sector in Italy: A Distributive Assessment

We study the distributive effects on Italian households of the three most relevant housing subsidies targeted to renters: a national rent supplement scheme introduced in the context of the reform that liberalised the rental market in the late 1990s, a tax credit for renters that has been recently strengthened and the implicit economic support given to tenants in the social housing sector, through below-market rents. The analysis is performed on data from the Eu-Silc survey for Italy and, in the case of the housing allowances, also on register data from 9 out of the 13 largest Italian towns. We consider, in particular, the ability of these schemes to target low-income households and their effects on the overall levels of poverty and inequality. Results from our analysis show a good targeting but very limited effect on social protection, with the partial exception of social housing.     

Work incentives and rent: Evidence from glasgow housing associations

Concern has been expressed by a number of commentators that the result of UK rent increases, in both the private and social rented sectors, has been a worsening of tenants' incentive to work. Although a number of studies have simulated thepossible effects on labour supply of rent rises, there are no published empirical estimates in the UK of theactual effects. This paper examines the various aspects of the rent-work incentive relationship, and uses data on Glasgow housing association tenants to estimate the relationship between rent rises and labour supply. The UK housing benefit system is described, followed by a brief overview of the previous literature. The various links between rents and work are examined in detail, and simple regression results are reported on the relationship between standardised rent increases and employment decisions. The results show that for male workers, the decision to take work is positively related to rent increases, but for women it is negatively related. In deciding between unemployment and working part-time, rent rises have a positive effect, whereas the effect is negative in the decision to work part-time or full-time. The overall effect of rent increases on labour supply in two-worker households is found to be negative. Gwilym Pryce is a lecturer in the Department of Urban Studies, University of Glasgow. His main research interests include: housing and labour market connections, mortgage protection insurance, asymmetric information in credit markets, and the economic analysis of housing demand and supply.     

Band-aid or Panacea? The Role of Private Rental Support Programs in Addressing Access Problems in the Australian Housing Market

Australia has a significant private rental market with over a quarter of households renting their home from a private landlord. Many of these households are on low incomes and receive assistance from private rental support programs provided by each Australian state and territory. In spite of these large numbers, little is known about the effectiveness of policy initiatives to assist low-income private renters. Limited knowledge of the private rental support programs stands in stark contrast to the detailed research on programs established to address homelessness and problems within the public housing sector. This paper addresses this lacuna by reporting on the suite of initiatives currently funded by state governments to assist low-income households (for example, bond loans and rental deposits, advice and help with removal expenses). Based on a comprehensive study of Private Rental Support Programs (PRSPs) commissioned by the Australian Housing and Urban Research Institute, it is argued that though policies to assist vulnerable tenants are acknowledged as a success by practitioners and clients, their effectiveness as a policy instrument is undermined by wider structural changes in the housing market. The paper concludes that the stress faced by many vulnerable households is likely to intensify over the coming years thereby compounding the pressure on state Housing Authorities to provide more comprehensive packages of support that extend beyond just a ‘one-off’ form of assistance.     

Tenant satisfaction with public housing management: Budapest in transition

Poor maintenance, low rents, and high levels of occupants’ dissatisfaction with their housing have been hallmarks of state‐rental housing in Hungary and other countries in Eastern Europe. The introduction of private management has been touted as an efficient way to improve services and increase tenant satisfaction, thereby paving the way for higher rents. This paper uses a new data set for January 1992 for dwellings in Budapest which were state rentals in January 1990, the majority of which were still rentals at the time of the survey, to analyse the impact of private management on tenant satisfaction and willingness to pay. The central conclusion of this analysis is that the introduction of private management significantly improves the satisfaction with maintenance services of occupants of units owned by Budapest district governments and now typically managed by the public IKV management companies. Similar results were found for occupants of units privatised in the past two years. We take this to mean that private firms are providing more services more efficiently. Remarkably, the increase in monthly fees (compared with state‐administered rents) associated with private management are modest. This and other findings suggest a three‐part housing reform strategy: (1) a rent increase to finance improved services; (2) a major shift to private firms to provide management services; and, (3) introduction of a housing allowance programme to protect poor households from the full impact of rent increases and to make the rent hikes politically more acceptable.     

Welfare or Work? Low-Income Working Households' Housing Consumption in the Private Rented Sector in England

This paper is concerned with issues of equity and efficiency in the Housing Benefit (HB) system in the private rented sector (PRS) in England. Using information from a survey of low- income working households (LIWH) and in-depth interviews with LIWH families, it addresses two policy-relevant questions. First, there are mixed findings on whether the current HB system enables HB recipients to consume more housing than is available to otherwise similar non-HB-recipient households in the PRS. HB rules on eligible property size appear not to unduly favour HB claimants compared with LIWH. LIWH, however, tend to pay a rent which is less than the maximum amount an HB recipient could receive. This is particularly true for LIWH families with children who are most likely to be living in properties smaller than allowed by HB regulations. Second, there is no evidence that the HB system incentivises LIWH to give up work or otherwise seek to become eligible for HB.     

Approaches to workforce housing in London and Chicago: from targeted sectors to income-based eligibility

In many cities, people with jobs essential to daily urban life—bus drivers, teachers, police, nurses and the like—cannot afford housing in proximity to their work. Municipal efforts to counter such job–housing imbalances include targeting such workers specifically or moderate-income households, more broadly, for housing support. This article investigates and assesses housing policy for modest-income workers in two cities, Chicago and London. Based on review of documents and key informant interviews, each city’s policy context, aims, means and outcomes are analyzed. Effective strategies include working with public, private and third-sector partners to find upstream cost-effective solutions, increasing shared equity/ownership products and developing mechanisms to ensure long-term affordability of workforce housing. While each city’s policies reflect local conditions, they also are indicative of broad trends in intermediate housing policy: an increase in stakeholders involved in programme administration and delivery, a continued focus on homeownership, rising income thresholds for eligibility and a shift away from targeting employment sectors.     

The housing careers of black middle-class residents in a South African metropolitan area

Under apartheid, black African households could not own land or homes in most major urban centres in South Africa. This limited residential mobility and locked many households into state rental accommodation in townships. Homeownership for all South Africans was restored in the mid-1980 s and the Group Areas Act was repealed in 1991. Democracy opened up economic opportunities previously unavailable to black people. This paper investigates the effect on black middle-class South African households’ residential mobility and housing careers. A retrospective cross-sectional survey of 244 such homeowners in the Mangaung Metropolitan Municipality determined their last five housing states. Changes in housing state indicated a steady improvement in housing quality, but tenure changes were not necessarily unidirectional—some had reverted to rental. More than 85% of the study participants had used mortgages to finance their housing career. Very few had financed their housing using own savings, an inheritance, or sale of a previous house, and not many had used the government subsidy. We found that housing careers are bridging the historical spatial racial divide in this municipality.     

An empirical analysis of the characteristics of residential location choice in the rapidly changing Korean housing market

This study examines the factors of residential location choice by considering the characteristics of the Korean housing market. From various factors of the residential location choice of a household, this study focuses on the effect of opportunities to engage in other activities, represented by accessibility, and the variety of housing tenure types—i.e., owner-occupied, Chonsei, and monthly rent—and the change of each type’s share of the market. The results of this empirical study indicate that households will most often choose to live in districts with more accessibility (a representative variable of demand-driven market), more permitted housing floor space (that of supply-driven one), higher rents, and lower housing prices in the Seoul Metropolitan Area (SMA). That is to say, the rapidly changing Korean housing market indicates a transition phase from a supply-driven to a demand-driven one. The significance of the variables and their effects were different for each housing tenure type. This means that the tenure type choice of a household is influenced by the level of income and assets. The results of this study are significant in understanding the characteristics of residential location choices of Korea and the countries in the transition as well.     

The Link Between Local Comprehensive Plans and Housing Affordability: A Comparative Study of the Atlanta and Detroit Metropolitan Areas

Problem, research strategy, and findings: I question whether the strength of affordable housing policies in local comprehensive plans is associated with better affordable housing outcomes, which I measure as a decrease in the share of low-income households who spend more than 30% of their income for housing, otherwise known as cost-burdened households. I first assess the strength of affordable housing policies in 58 local comprehensive plans, counting the number of—and degree of coercion in—those affordable housing policies. I then analyze the relationship between the strength of affordable housing policies and changes in the share of low-income households with cost burden. I find that the strength of affordable housing policies is higher in the Atlanta (GA) metropolitan area than in the Detroit (MI) metropolitan area. I also find that the strength of affordable housing policies is positively associated with a decrease in the share of low-income households paying more than 30% of their income for housing in the Atlanta metropolitan area. I do not find a comparable relationship between plan strength and housing outcomes in the Detroit metropolitan area. I also find that the state role matters: Georgia provides more support and guidance for local comprehensive planning, and for affordable housing policies in those plans, than does Michigan.

Takeaway for practice: Planners should continually promote local comprehensive plans that include more and stronger affordable housing policies and advocate for greater state support for comprehensive planning and affordable housing policies because these appear to lead to a greater likelihood of implementing stronger plans.     

Long-term Renters in the Australian Housing Market

The paper provides the first examination into the characteristics and housing circumstances of long-term private renters in Australia. It utilises a national sample of 4677 private renter households drawn from the 1994 ABS Survey of Rental Tenants. In Australia 40 per cent of private renters are identified as 'long-term renters', defined as having rented for more than 10 years. Two main types of long-term renters are examined: 'continuals' who have rented continuously since leaving the parental home, and 'returners' who have resumed renting after a period as a home purchaser, but cumulatively have rented for more than 10 years. Continuals, in contrast to returners, are characterised mainly by lower household incomes and higher unemployment. Returners, on the other hand, are more diverse socio-economically, older than other private renters, and more likely to have experienced marital breakdown. Long-term renters (both continuals and returners) change residence less frequently (although still at a rate double the national average). Rental conditions also vary between long and shorter-term groups. Long-term renters appear to be in a less form alised sector of the market. They are less likely than shorter-term renters to rent from estate agents, pay a bond, hold a lease, or pay rent in advance. The findings in this paper challenge the traditional view of private rental as predom inantly a short-term, transitional tenure.     

DOES INNER CITY PUBLIC HOUSING EXACERBATE THE EMPLOYMENT PROBLEMS OF ITS TENANTS?

ABSTRACT: This article analyzes whether inner city public housing exacerbates the employment problems of its tenants. Results from two evaluations of public housing demonstrations are used to test the potential impact of location, address discrimination, eligibility criteria, and rent schedules on tenant work behavior. To supplement this analysis, the effects of public housing on tenant employment, including self-employment, are estimated using a unique cross-sectional data set known as the Urban Poverty and Family Life Survey. The results do not support the claim that public housing, independent of tenant characteristics, contributes to employment patterns. While it is true that most public housing residents do not work, their counterparts in the private real estate market are no more likely to be employed or to have ever worked. Overall, these results indicate that the provision of public housing does not inhibit work behavior.     

Low Income Housing Tax Credit Programme Impacts on Housing Affordability in Australia: Microsimulation Model Estimates

Growing concern about a lack of rental housing affordable to low-income Australian households has prompted consideration of possible policy interventions. This paper estimates the potential housing market impacts of a tax credit targeted on rental housing affordable to low-income Australian households. The study finds that existing landlords in low-income rental housing benefit from a one-third or more reduction in their effective tax burdens. If these tax benefits are passed on in the form of lower market rents, it is estimated that the percentage of households paying more than 30 per cent of gross income in rents falls from 26 to 21 per cent. This impact would be larger but for eligible households in receipt of demand-side subsidies in the form of rent assistance. As a consequence, many low-income households receive only part of the low income housing tax credit benefits that are passed on into lower market rents. Moreover, higher income tenants occupy some of the cheaper rental housing targeted by tax credits, and this weakens the policy rationale for such supply-side measures. The paper advocates the adoption of headleasing arrangements to increase the share of benefits received by low-income tenants.     

Low-Income Access to Urban Land and Housing in Botswana

Like most developing countries, Botswana—a middle-income country—has experienced rapid urban growth, which has brought in its wake many social and economic problems. One of the key challenges has been the lack of access to land and housing for the poor who have moved into the urban centres in large numbers in search of employment and economic survival. Many programmes and strategies have been introduced by both central and local governments to address this problem. These include: squatter settlement upgrading; public housing through site, service and self-help housing; subsidised plot allocation; financial incentives for housing construction, etc. Many challenges have hampered the implementation of these strategies and programmes including fast urbanisation, which outstrips supply of land and housing for most urbanites; unaffordability of many of these schemes; poor targeting; high defaulting rates and poor management of these schemes. This paper calls upon the government, the private sector and local communities to devise holistic solutions to enable low-income households to procure decent accommodation in urban areas.     

Gentrification or social renewal? Effects of public supported housing renewal in Denmark

This paper analyses social change, particularly the processes of social decay, in obsolete and deteriorated housing in the older housing stock in Denmark between 1986 and 1996. These changes are compared with the development which has occurred in similar kinds of housing that have been physically upgraded through a government program for housing renewal.

The study shows that this kind of housing attracts a quick turnover of residents and a tendency towards more unemployed or lower income occupants. It is also used by young people as their first home when moving away from their parents.

It is also shown that public supported housing renewal stops this type of housing pattern and increases the share of households that have high incomes. The changes, however, are not considerable and there are also many unemployed people among the newcomers. These changes depend to a large degree on the size and tenure of the renewed dwellings. In private renting, particularly co‐operatives and in larger dwellings the socio‐economic composition of residents undergo greater changes than in smaller dwellings in non‐profit or public housing. Extensive renewal often results in high rent compared with rent from the regulated housing market in Denmark. As a result the renewed dwellings have difficulties in competing with other kind of dwellings. For that reason residents of this type of housing primarily consist of welfare or pension recipients or others who receive high housing benefits. A minority of people with higher income also use these dwellings but mostly as temporary housing as after a few years they often move to owner‐occupied housing.     

Nominations: An Actor-Network Approach

This paper offers an empirical assessment of the potential benefits to housing studies of actor-network theory (ANT). Gabriel & Jacobs' paper in this journal has suggested that certain ‘classic’ sites of housing studies are being re-imagined by studies within the post-social turn. This paper is an empirical study of the nominations process, through which registered social landlords are enrolled into allocating social housing to households prioritised by local authorities on their housing registers. The study draws on three ANT stories—the nominations agreement, monitoring nominations and exclusions—to demonstrate how human and non-human actors interact. In particular, it considers how agreements, numbers, unsurveyed ‘customers’, or boxes on forms, talk, who does the talking and the purposes of such talking. The paper concludes with occasionally sceptical observations about the utility of ANT to housing research.     

Housing liquidation and financial adequacy of retirees in New Zealand

Abstract

This study investigates the impact of housing on financial adequacy of New Zealand retirees using the Survey of Family, Income, and Employment (SoFIE) data for the period 2002–2009. We examine the differential effect of housing liquidation options, rent imputation and asset liquidity on financial adequacy. We report evidence of financial adequacy variation across five housing liquidation options and this is influenced by rent imputation. The results show that non-homeowners are less financially adequate than homeowners. We find that Māori, renters and individuals living in multi-dwelling occupancies have much lower levels of financial adequacy. Individuals of Pākehā or Asian ethnicity, homeowners and those living alone benefit more from imputed rent derived through home ownership. Our study highlights the need for the New Zealand government to address the lack of suitable public housing, rising housing and rental prices and mandate compulsory contributory retirement savings plans.     

The impact of unemployment on home ownership

Much of housing policy in Britain and much of the theoretical literature is based on assumptions that home ownership, per se, provides certain distinctive and advantageous characteristics such as independence, security and wealth. This paper provides some empirical evidence as a corrective to these assumptions. It does so by locating their basis not inside but outside the tenure: in particular in the position of individual home owners in the labour market. The paper identifies two sets of costs incurred in home ownership — entry and running costs — and draws on evidence to show how recent changes in the labour market in Britain, which have resulted in widespread unemployment, have affected the ability of many home owners to continue to meet those costs. Specifically it demonstrates that large numbers of home owners experience insecurity of tenure and poor housing conditions.