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.     

Home ownership undermined?

The Finnish home ownership sector, proportionately one of the largest in Europe, experienced a boom in the late 1980s, followed by a slump characterized by falling and static prices, arrears, and reduced transactions. The paper addresses the question of whether this can be regarded as a cyclical downturn, from which the market will eventually return to normality, or as a signal of structural change. The slump is largely due to the restructuring of the labour market that has come to erode the basis of the growth of home ownership. The paper examines the Finnish situation against that in Britain which has undergone similar market trends. It concludes that although there have been similar developments in both countries in moves towards low-inflation economies and reductions in subsidies to home owners-both of which could be interpreted as structural changes-their labour market developments show some differences. In Finland the development of a flexible and casualized labour market has been less vigorous. The paper concludes with a discussion of these developments in terms of crisis embedded in the attempts of governments to protect capital accumulation. It also speculates about the generalizability of the findings to other European countries.     

Private Rental Housing in Hong Kong

This paper examines selected aspects of housing policy and its influence on private rental housing in Hong Kong. Its ambitions are modest, in part because so little research has been conducted on the sector, as a consequence of the small size of the sector as well as the concentration of socio-political, economic and policy analyses on the other major housing sectors, namely public renting and home ownership. It is argued that a fundamental function of private renting, to provide a functional substitute and counter-balance to distortions in the market for private home ownership, has been systematically undermined in Hong Kong. In spite of its historical importance in meeting Hong Kong people's housing needs, the sector's decline has been steep and it can now be fairly described as a marginalised tenure, despite incomplete structural adjustment post- Asian Financial Crisis. It is suggested that a fundamental reason for the decline of the private rental sector has been the impact of government policy, which undermined the private rental sector and thus an important element of the market mechanism in housing provision. The government's ideology of home ownership has also functioned to transfer lower middle-income families into the owner occupied sector. Although the Hong Kong government has not been as overtly hostile to this sector as governments have been elsewhere, it nevertheless also seems to envisage no real role for the private rental sector in a housing delivery system molded by policy preference for home ownership, rather than fostering viable economic competition by also facilitating an efficient private rental sector.     

Promoting home ownership in a social‐rented city: policies,practices and pitfalls

Amsterdam's housing market is dominated by the social‐rented sector. It comprises 56 per cent of the total housing stock, while home ownership comprises only 19 per cent, lower than anywhere else in the Netherlands, and among the lowest in the world. Central government policy is currently seeking to increase the share of home ownership in the Netherlands from 53 per cent (2001) to 65 per cent in 2010. This paper will summarise recent national and local (Amsterdam) housing policy developments, focusing on the recent practice of selling social housing in Amsterdam. Unlike the Right to Buy scheme in Britain, the Netherlands employs an ‘offer to buy’ strategy. Sales, however, have been disappointing so far. Two factors were found to be crucial in this regard: (1) the sluggish change in ‘policy mentality’ and bureaucracy and (2) the high prices in the home ownership market. By way of conclusion, the paper reflects on the desirability of shifting the tenure structure from tenancy to ownership and on the risks that an (over‐) emphasis on home ownership may bring.     

Changing directions in Australian housing policies: The end of muddling through?

From the post‐war period through to the 1980s, Australia's housing system was dominated by tenure‐based policies directed towards home ownership and the provision of public housing. Private tenants were virtually excluded from housing assistance of any form. The 1990s, however, have seen an apparent U‐turn in housing policies with elimination of explicit home ownership policies, the withdrawal from direct involvement in public housing funding and a rapid expansion of rental assistance for private tenants. Australia is about to follow its New Zealand neighbour in undertaking a wholesale shift away from direct intervention in the production of housing and moving towards consumer subsidies which rely on the effective operation of the private sector in meeting housing needs. This paper provides a brief overview of changes in policies towards home ownership, public rental and private rental, a framework for interpreting these and an assessment of the appropriateness of the directions currently being followed in light of current economic trends.     

Spatial and Social Divisions within British Cities: Beyond Residualisation

The literature on changing residential patterns in cities attributes different degrees of importance to economic restructuring and to changes in housing. In Britain, where a significant share of housing provision is not provided through the market, the references to socio-tenurial polarisation and the residualisation of council housing have emphasised the importance of housing tenure. The nature of housing restructuring has affected both the pace and pattern of urban change. At the end of the 1990s problems associated with deprived neighbourhoods are arousing policy attention and this has given further prominence to housing tenure differences and residualisation. This paper reviews evidence which suggests that a wider range of housing related factors are now influencing changing patterns in British cities. These especially relate to divisions within home ownership and to differences related to ethnicity and cohort. The evidence presented cautions against placing tenure at the centre of analysis of change and policy responses or equating neighbourhoods of social rented housing with area deprivation.     

Housing Tenure: Pacific Families in New Zealand

Home ownership has been associated with health, social and economic benefits. However, a decline in ownership has been observed over the past decade in New Zealand. Minority groups, including Pacific people, have been disadvantaged in the housing sector. This study investigated housing tenure and the relationship between tenure and health among mothers of a birth cohort of Pacific children in New Zealand. Findings showed that most families lived in state or private rental accommodation with few (15.4 per cent) owning their own homes. Homeowners were more likely to be older, partnered and have higher incomes. Better mental health was observed for homeowners compared to renters. Findings can inform housing and public health policy for Pacific families.     

Achievement of home ownership among post‐war Australian cohorts

Entry costs to home ownership have been rising in Australia since the mid‐1950s but home ownership rates had not fallen by the mid‐1980s. Drawing from a national life history survey carried out in 1986–87, this paper shows that median ages for first time home buying have been declining among successive cohorts over the post‐war era. The paradox of rising entry costs and earlier home buying may be explained by rising labour force participation among women immediately after marriage and awareness of the increasing financial returns from long‐term home ownership. Among the later cohorts, early entry to home ownership appears to have been associated particularly strongly with wives' employment after marriage and husbands' incomes. The findings suggest that access to home ownership in the future may be increasingly limited to young adults having high household incomes.     

Moving Out of Home Ownership in Later Life: The Influence of the Family and Housing Careers

Home ownership is often regarded as the preferred housing tenure; however, situations in parallel life-course careers might make moving to a rental home necessary or attractive to home owners. Retrospective data from the SHARELIFE survey were used to study the short- and long-term impact of situations and disruptions in the family and housing careers on leaving home ownership at middle (45–64) and older ages (65–80) in Denmark, Sweden and the Netherlands. We found that directly after separation and widowhood, the likelihood of leaving home ownership was the greatest. However, more than 10 years after separation and widowhood, individuals were still significantly more likely to leave ownership than those in their first marriage. Furthermore, late first childbirth and early first-time home ownership were associated with lower chances of leaving home ownership. We conclude that situations and changes in family and housing careers have both a short-term and a long-term impact on the likelihood of moving out of home ownership.     

From renting to owning: Life course and housing market circumstances

Moving from a rental dwelling to owner occupation is an important event in the housing career of a household. The literature shows that considerations of housing consumption, related to household circumstances, play a dominant role in the decision to rent or to buy a dwelling. The analysis in this article substantiates again that family status must have reached a certain stability, and prospects of a substantial permanent income must be good, before the move from renting to owning is considered. But general economic circumstances which manifest themselves into changes in housing market conditions, also have measurable influences on the decision for renting or owning. In the Netherlands, the propensity for renters to buy a dwelling were low between 1978 and 1982 when prices of owner occupation were falling, mortgage interest rate was high and income prospects were uncertain. Government policy certainly has an influence on the decision of households to rent or to buy a dwelling. In the long term government promotion of one particular tenure sector over a long period may well stimulate household preference for this sector. And by consistently building large parts of new construction in one tenure, opportunities of moving in or into this sector are increased as this article illustrates for Randstad Holland.     

Price and distributional effects of privately provided open space in urban areas

In recent decades, there has been a noticeable increase in land conservation by the non-governmental sector, supplementing governmental efforts to preserve open spaces and landscapes at the urban–rural fringe. This trend should, according to a prominent urban economics model, have significant effects on urban real estate markets. The effects will vary along the income and home ownership distribution. The model is followed by an empirical investigation of the theoretical predictions using a rich data-set from the counties in the San Francisco Bay Area. The hedonic regressions show that private land conservation has a significant effect on housing prices, but this effect varies between areas with different housing tenure shares. An increase in the share of home renters in a neighbourhood diminishes the effect of land conservation on housing prices, confirming the predictions of the model. The results provide evidence in favour of spatially explicit policies to support conservation efforts.     

Affordability Crises in Housing in Britain and Japan

Today home ownership is the dominant housing form among the majority of advanced countries. Particularly in Britain, in the 1980s there has been a rapid increase in the number of home owners, resulting in a 66 per cent rate of home ownership in 1992. In spite of this increase, there are still housing problems to be overcome and in a sense the situation has become worse. Naturally, there have been heated discussions about how this process and home ownership itself should be assessed. When we consider this issue, we should not forget the basic fact that housing relates directly to land ownership and this is what distinguishes it from other sectors of the economy. What seems to be lacking in the discussions, however, is an adequate placement of land ownership in considering home ownership or commodification of land in discussing the question of housing.     

Motives for Home Ownership: Before and After the Transition

Regarding the dramatic shift towards home ownership in transition countries, the changing macro policy frameworks have been widely discussed, whereas the meaning of home ownership remains an under-researched issue. This paper examines the motives for home ownership and aims to identify any change in them parallel to the contextual transformations. An exploratory qualitative analysis of 25 interviews indicates a change in argumentation from a mostly detailed circumstantial consideration among pre-transitional entrants to mainly modest argumentation among post-transitional entrants, which took home ownership as a “normal tenure” and “the market” as a self-referential, self-justifying interpretative framework, as is typical of the neoliberal transitional discourse. Our specific data-driven categorization of the motives demonstrates the impact of contextual change on the meanings of tenures and the relative rise in attractiveness of home ownership. In contrast, public renting shared the destiny of many other public welfare institutions that had previously served as a hedge against individual risks, but were retrenched and restructured during transition. Public renting proved to be specifically exposed and highly vulnerable to political pressures.     

Do house prices rise that much? A dissenting view

The debate over the social significance of home ownership partly rests on the ‘house price assumption’ — the notion that house prices rise consistently above general inflation rates and benefit all owners. However, these theoretical claims rest on sparse empirical evidence and are beset by measurement difficulties. This article attempts to measure real house prices (ie adjusted for inflation) and pure house prices (ie adjusted also for quality and quantity changes) for Britain since the mid 1960s. Comparisons are also made with high and low price regions in Britain and with four other north European countries. Results suggest that real and, even more, pure price gains are not assured, that price falls are as significant as price rises, and that over the long term gains may be low and even ephemeral. Short term booms and slumps may distribute gains and corresponding losses between owner occupiers, but this redistribution is likely to be socially random. These results therefore support criticism of the ‘housing sector cleavage’ model.     

Path Dependence and Critical Junctures in Irish Rental Policy: From Dualist to Unitary Rental Markets?

Ireland is categorised as an example of the dualist rental system in From Public Housing to the Social Market—Kemeny's (1995) landmark comparative study of rented housing. This article, which examines the historical development of public subsidisation of housing and regulation of tenants' occupancy rights in Ireland, argues that contrary to Kemeny's (1996) assumption, the dualist model has recently unravelled in this country and been replaced by an embryonic unitary rental model. This is evidenced by increasing tenure neutrality of government housing subsidies; equalisation of the secure occupancy rights and minimum standards regulations across most of the rented sector and the recent decline of home ownership and expansion of renting for the first time since records began. Using ‘path dependence’ and other concepts from the historical institutionalist literature, the reasons for these developments are explored as are their implications for Kemeny's (1995) thesis.     

Home Ownership and Economic Change in Japan

The state of the residential property market is an important issue for both the macro economy and for individual households in Japan. Home ownership is the main pillar of housing policy and as a very expensive commodity it has been deeply implicated in the economic problems of the 1990s. This paper considers the role of home ownership within the broader context of the post-war Japanese social structure. The core of the paper is an assessment of the impact of the recent period of financial turbulence on the home ownership sector. This discussion is set within the broader context of the new pressures emerging around the institutional arrangements which have sustained the Japanese social system.     

Tenure type landscapes and housing market change: a geographical perspective on neo-liberalization in Sweden

Abstract

Discussions of tenure mix have received renewed interest as many have suggested that neo-liberalization has made way for gentrification of neighbourhoods and increasing segregation. Yet, few scholars have studied country-wide changes in tenure mix, due to the lack of data and appropriate methods. In this article, we propose to use tenure type landscapes to analyse changes in housing policy. We do so while acknowledging the evolution of housing policies in Sweden since 1990. Using individualized and multi-scalar tenure type landscapes to measure change in neighbourhoods, we analyse housing clusters in 1990 and 2012. We show that the tenure landscape in 1990 at the height of the welfare state was fairly diverse and mixed. During the next 22 years, however, the landscape changed to become more homogenized and dominated by ownership through tenure conversions and new housing. We argue that awareness of these changes is essential to understanding present and future segregation and gentrification processes.     

Public housing,home ownership,and community participation in Chicago's inner city

The impact of public housing on the motivation of its tenants to engage in action to prevent its deterioration has been a topic of recent debate. This discussion has led some to advocate the sale of public housing to tenants as a means of giving them a stake in their community, and, thus, the motive to prevent its deterioration. By using the Urban Poverty Family Life Survey, this paper estimates the effects of public housing and home ownership on rates of community participation. The results do not support those who claim that residents of inner‐city public housing are less likely to become involved in community affairs than inner‐city home owners. The results also suggest that factors other than housing tenure status, such as church attendance, family structure, and the number of families known in the neighborhood are responsible for variation in rates of community participation. Taken together, these results stress the need to look beyond the simple causal relationship between community participation and home ownership.     

Home ownership,mortgages and psychological distress

Although many studies have established that owning a home is associated with a variety of health benefits (lower mortality and morbidity rates), important gaps in our understanding of the relationship between housing tenure and health remain. In particular, previous research has tended to rely upon single, binary measures of housing tenure (home owners versus renters). These broad categories do not capture the heterogeneity that exists within housing tenure classifications. This paper uses an expanded measure to differentiate home owners with mortgages, from those who do not have mortgages and from those who live in rental accommodation. The results reveal a gradient in housing tenure and psychological distress; individuals in rental situations report the highest levels of distress, home owners without mortgages the lowest levels. Moreover, housing tenure modifies the impact of stress on distress in these data. The findings are interpreted in the context of changes to housing policy in Canada, and the economic climate during the period in which these data were collected. Future research directions are discussed.     

Social Belonging,Social Capital and the Promotion of Home Ownership: A Case Study of Hong Kong

The Hong Kong Government is vigorously promoting home ownership, a major rationale being to increase the community's sense of belonging and reduce the rate of emigration. This paper evaluates whether home owners in Hong Kong have a higher sense of social belonging than renters and finds that tenure status is a spurious independent variable in assessing respondents' sense of belonging to Hong Kong. Logistic regression analysis suggests that the significance of tenure is greatly reduced when other variables, namely age, identity, income and foreign abode right are controlled. The analysis also shows that those possessing a comparatively high sense of social belonging tend to bear the identification of Hong Kong Chinese, be older, have high incomes, and hold no foreign right of abode. Of the control variables, the factor of 'identity' appears most influential. Hong Kong's relationship with China, the uncertain nature of a Hong Kong identity and the territory's economic trajectory as a higher order services economy has meant that housing policy, specifically the promotion of home ownership, is perceived by the government as influencing values and behaviour very narrowly defined as promoting social belonging primarily in a territorial or geographical sense, with wider implications of neighbourhood stability unconsidered.