Housing Stress or Transport Stress? Issues in Australian Housing Affordability

Yogi Vidyattama, Robert Tanton () and Binod Nepal

No 11/06, NATSEM Working Paper Series from University of Canberra, National Centre for Social and Economic Modelling

Abstract: Housing stress is usually measured on the basis of income and direct housing costs such as mortgage repayments and rents. One cost that is not included in calculations of housing stress, but which may be important, is the difference transport costs make. Especially in city areas, paying a premium for a house that is close to work may offset the additional transport costs incurred getting to work. So a measure of housing stress which includes transport costs may give a different picture of housing stress to a measure that ignores transport costs. In this paper, we argue that transport costs need to be taken into account in measuring housing stress not only in the capital cities but also outside capital cities. We find that in capital cities, bringing transport costs into a housing stress measure increases the number of both purchasers and renters in housing stress by 25 per cent, and it particularly affects households with children. However, we also find that the impact of transport cost is even greater outside capital cities.

Keywords: housing; stress (search for similar items in EconPapers)
Pages: 24 pages
Date: 2011-06
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