Housing Affordability Options for First Home Owner-Occupiers in Australia: A Simulation Analysis

Ross Guest ()

No 66, Econometric Society 2004 Australasian Meetings from Econometric Society

Abstract: This paper presents a simulation analysis of several policies, or policy proposals, for improving housing affordability for first home owner-occupiers in Australia: the First Home Owner Grant, housing equity partnerships and deposit loans. The focus is on the impact of these measures for housing demand, the private saving rate and house prices. The simulations apply a housing tenure choice model in which a representative adult household makes a lifetime plan concerning when to buy and sell a house, and the amount of housing and non-housing consumption over its adult lifetime. An insight from the lifecycle framework is that policies to improve housing affordability can have two effects on housing demand and house prices: a life-cycle timing effect and a liquidity effect; and it is possible that these effects will work in opposite directions on housing demand and therefore house pric

Keywords: Housing economics; household saving (search for similar items in EconPapers)
JEL-codes: D13 R21 R31 (search for similar items in EconPapers)
Date: 2004-08-11
New Economics Papers: this item is included in nep-cmp and nep-geo
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