Paper
Affordable housing in New Zealand cities : an economic and policy analysis
Published 2013 · DOI · R. Chapman
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Abstract
In the last two decades in New Zealand, widening income inequalities1 and a decline in home ownership rates2 have combined with a shortfall in the volume of new construction3 to contribute to pressure on the affordable housing market, particularly the rental market, including an unmet demand for social housing.* Affordability is of course a social construct, a recognition that society has legitimate altruistic concerns to ensure that housing costs do not absorb too much of a household’s income, jeopardising other aspects of their ability to function in society. Even where households are not in urgent and immediate need, it is important that households do not pay a large percentage of disposable household income for reasonable quality and reasonably accessible housing. The adequacy of the affordable housing stock raises a wider set of issues than the adequacy of social housing, and an essentially economic perspective on the question of affordable housing in New Zealand needs to be placed in the broader context of sustainability. Affordability is not the only public policy goal in relation to housing; importantly, factors such as carbon mitigation and the prosperity and quality of life of our urban settlements need to be considered alongside affordability. The deficiencies in the housing market are driven by a number of factors, but these are amenable to well-judged government interventions.
New Zealand's affordable housing market faces pressure from income inequalities, declining home ownership rates, and a lack of new construction, with sustainability and urban prosperity also crucial factors.
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