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1 – 10 of 276N.T. Khuong Truong, Susan J. Smith, Gavin Wood, William A.V. Clark, William Lisowski and Rachel Ong ViforJ
The purpose of this paper is to consider one test of a well-functioning housing system – its impact on wellbeing. Exploring one indicator of this, this study aims to track changes…
Abstract
Purpose
The purpose of this paper is to consider one test of a well-functioning housing system – its impact on wellbeing. Exploring one indicator of this, this study aims to track changes in mental and general health across a mix of tenure transitions and financial transactions in three jurisdictions: Australia, the UK and the USA.
Design/methodology/approach
Using matched variables from three national panel surveys (Household, Income and Labour Dynamics in Australia, British Household Panel Survey/Understanding Society and Panel Study of Income Dynamics) over 17 years (2000–2017) to capture the sweep of the most recent housing cycle, this study adopts a difference-in-difference random-effects model specification to estimate the mental and general health effects of tenure change and borrowing behaviours.
Findings
There is an enduring health premium associated with unmortgaged owner-occupation. Mortgage debt detracts from this, as does the prospect of dropping out of ownership and into renting. A previously observed post-exit recovery in mental health – a debt-relief effect – is not present in the longer run. In fact, in some circumstances, both mental and general health deficits are amplified, even among those who eventually regain homeownership. Though there are cross-country differences, the similarities across these financialised housing systems are more striking.
Practical implications
The well-being premium traditionally associated with owner occupation is under threat at the edges of the sector in all three jurisdictions. In this, there is cross-national convergence. There may therefore be scope to introduce policies to better support households at the edges of ownership that work across the board for debt-funded ownership-centred housing systems.
Originality/value
This paper extends the duration of a previous analysis of the impact of tenure transitions and financial transactions on well-being at the edges of ownership in the UK and Australia. The authors now track households over nearly two decades from the start of the millennium into a lengthy (post-global financial crisis) era of declining housing affordability. This study adds to the reach of the earlier study by adding a general health variable and a third jurisdiction, the USA.
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Du Lijing, Jian Huang, Daniel Singer and Gokhan Torna
The purpose of this paper is to investigate the impact of social and economic factors on home ownership as an investment in American urban areas.
Abstract
Purpose
The purpose of this paper is to investigate the impact of social and economic factors on home ownership as an investment in American urban areas.
Design/methodology/approach
The authors run a spatial analysis using home ownership data on 817 American counties from US Census Bureau’s 2013 American Community Survey.
Findings
While the amenity value of home ownership is found to be important to overall housing tenure decisions, it is found to be less so for the ownership cohort without mortgages. Economic factors are found to impact the spatial pattern of owner-occupied housing without mortgage differently than that of all owner-occupied housing. The implications of these differences for investors are explored.
Research limitations/implications
The results may lack generalizability outside of the American urban areas.
Practical implications
As a result of the findings of this study, a shift in investor focus from minimizing initial housing costs to sustainable housing costs is recommended.
Originality/value
This study provides insights into the social and economic dimensions of owner-occupied housing in order to create a more profitable investing policy for promoting home ownership.
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Braam Lowies, Graham Squires, Peter Rossini and Stanley McGreal
The purpose of this paper is to first explore whether Australia and the main metropolitan areas demonstrate significant differences in tenure and property type between…
Abstract
Purpose
The purpose of this paper is to first explore whether Australia and the main metropolitan areas demonstrate significant differences in tenure and property type between generational groups. Second, whether the millennial generation is more likely to rent rather than own. Third, if such variation in tenure and property type by millennials is one of individual choice and lifestyle or the impact of housing market inefficiencies.
Design/methodology/approach
This paper employs a comparative research approach using secondary data from the Australian Bureau of Statistics (ABS) to consider housing tenure and type distributions across generations as well as through cross-city analysis.
Findings
The results show that home ownership is still the dominant tenure in Australia, but private rental is of increasing significance, becoming the tenure of choice for Millennials. Owner occupation is shown to remain and high and stable levels for older generations and while lower in percentage terms for Generation X; this generation exhibits the highest growth rate for ownership. Significant differences are shown in tenure patterns across Australia.
Originality/value
The significance of this paper is the focus on the analysis of generational differences in housing tenure and type, initially for Australia and subsequently by major metropolitan areas over three inter-census periods (2006, 2011 and 2016). It enhances the understanding of how policies favouring ageing in place can contradict other policies on housing affordability with specific impact on Millennials as different generations are respectively unequally locked-out and locked-in to housing wealth.
The article looks at the different distributional patterns of two alternative ways of reforming relief for owner‐occupation in UK, namely the reintroduction of income tax on…
Abstract
The article looks at the different distributional patterns of two alternative ways of reforming relief for owner‐occupation in UK, namely the reintroduction of income tax on imputed rent (the optimal reform, assuming housing is an investment good) or the withdrawal of tax relief for mortgage interest payments (possibly the more likely political reform). Inland Revenue data show that removal of mortgage interest relief (exclusive of the Option Mortgage) would be the more progressive measure. Removal of relief at higher rates of tax would be one possible step on the road to reform of mortgage interest.
In this paper culture is considered by marketers to have a profound influence on consumer behaviour, yet explanations of tenure preference ignore or dismiss culture as a factor…
Abstract
Purpose
In this paper culture is considered by marketers to have a profound influence on consumer behaviour, yet explanations of tenure preference ignore or dismiss culture as a factor underlying such preferences. This paper therefore aims to examine the attitudes of retirement housing purchasers to tenure, the effect of culture on these attitudes, and contrast some of the results of the research.
Design/methodology/approach
In the paper data were collected by questionnaire. A sample of about 200 respondents was selected from all purchasers of retirement housing in the West Midlands region of the UK.
Findings
The findings in this paper demonstrate that culture is an important factor affecting retirement housing purchasers' attitudes to housing tenure and that home ownership is part of their way of life.
Originality/value
It is argued in this paper that culture cannot be dismissed or ignored when debating the tenure preferences of older people and the factors affecting these preferences; and that it is probably the prime factor underlying a “natural preference” for home ownership.
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Abdulkader Mostafa and Colin Anthony Jones
The UK experienced a substantial rise in owner occupation over the twentieth century, and many tenants still aspire to homeownership. These strong aspirations to own are…
Abstract
Purpose
The UK experienced a substantial rise in owner occupation over the twentieth century, and many tenants still aspire to homeownership. These strong aspirations to own are attributed to a set of financial and non-financial benefits. This paper aims to calculate, for the first time, the financial returns from buying versus renting in Britain for first-time buyers in 11 regions.
Design/methodology/approach
It applies a DCF approach based on historical housing and mortgage market data from 1975 to 2012.
Findings
The paper finds strong evidence that, in purely financial terms, buying has been always superior to renting in all regions of the UK over the period.
Practical implications
It gives a clear message of the financial benefits of homeownership over renting in Britain, even over very short time periods.
Originality/value
The paper is the first to apply a comprehensive DCF model to the choice between renting and owning.
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The residential private rented sector (PRS) has the potential to make a significant contribution to the housing needs of the future. The PRS benefited from regulatory changes in…
Abstract
The residential private rented sector (PRS) has the potential to make a significant contribution to the housing needs of the future. The PRS benefited from regulatory changes in the late 1980s that removed fetters to rent levels and tenancy length. The historic under‐investment is being re‐evaluated and the PRS is beginning to emerge as a viable corporate and institutional investment vehicle. The strategic assembly of portfolios, which may be highly specialised or more general, can be identified from published demographic forecasts. Finance for new‐build, refurbishment and bulk acquisition can be sourced from specialist residential investment funds. The overall effect of these measures is beginning to make the PRS a reinvigorated investment opportunity with long‐term potential.
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Christine Whitehead and Sarah Monk
The purpose of this paper is to explore the role of affordable home ownership in the light of the recent global financial crisis.
Abstract
Purpose
The purpose of this paper is to explore the role of affordable home ownership in the light of the recent global financial crisis.
Design/methodology/approach
The paper draws on recent research conducted by the authors and others which included analysis of secondary data and policy documents and interviews with key stakeholders including housing associations and developers. The theoretical scope of the paper is outlined in the first section which looks at the principles behind the two main approaches to providing affordable home ownership: shared equity and shared ownership. Given continuing aspirations on the part of most households in England to become home owners, the key comparison is with the attributes of full ownership.
Findings
The paper finds that the main products share many of the attributes of full home ownership while remaining more affordable. The economic situation post‐2007 made both shared ownership and shared equity more difficult. The crisis and its aftermath also suggest that there is a need to develop a more robust and longer term market in equity sharing. This could be of real significance into the longer term, especially if the availability of mortgage finance remains constrained for many years to come. The paper concludes that in the longer term, developing a range of partial tenures which provide most of the benefits of owner‐occupation but which reduce risks to individual households and improve affordability in the early years is a desirable strategy.
Practical implications
There are clear implications for policy makers in other countries, notably the benefits from developing an intermediate tenure market which includes institutional equity and risk taking rather than continued large‐scale reliance on debt finance.
Originality/value
Given stated governmental ambitions to meet housing aspirations, this paper clarifies how it is possible to meet an identified need for affordable home ownership products to fill the growing “gap” between first‐time buyers who can purchase with parental help and those who have no means of achieving home ownership, even though they have the income to support such a choice.
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The purpose of this paper is to examine whether the continuing decline of the social rented sector in England implies increased residualisation of the sector, to estimate who is…
Abstract
Purpose
The purpose of this paper is to examine whether the continuing decline of the social rented sector in England implies increased residualisation of the sector, to estimate who is likely to be living in social housing in the future, and to explore the policy implications in terms of the future role of social housing.
Design/methodology/approach
The paper addresses these aims by analysing secondary data on the characteristics of current tenants and changes in these as the sector has become smaller. It applies the results of this analysis to demographic projections to determine the likely future profile of social housing tenants and to assess the implications of this for the future management of the sector.
Findings
Analysis results suggest that the sector will house three main groups of households in the future: those for whom it provides a secure home for life; those for whom it is a temporary tenure; and a smaller group who enter for the first time in old age.
Research limitations/implications
The main limitation of this approach is that it assumes that the future will be like the past, whereas changes in policy and economic circumstances could produce a different outcome. However, recent trends reflect the outcomes of economic variables and policy changes take time to have an impact, therefore the analysis has practical applications in the short term.
Originality/value
The method, findings and policy implications in this paper all provide value for policy makers, as well as contributing to the wider debate about the role of social rented housing.
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Comparative studies of social policy in general, and housing is no exception, are always fraught with difficulties. There are very few attempts which entirely manage to escape…
Abstract
Comparative studies of social policy in general, and housing is no exception, are always fraught with difficulties. There are very few attempts which entirely manage to escape both of the major traps. On the one hand is the danger of drifting into an abstract empiricism which can end up concentrating on such factors as the details of subsidy systems or the precise percentages of income which people pay for housing in various countries. At best this becomes numbingly boring and at worst (for example where payment or subsidy figures are described in local currency terms without indicating exchange rates) incomprehensible.