A fresh look at contemporary perspectives on urban housing affordability

Abstract

The literature on housing affordability has grown rapidly since Hulchanski [1995, p. 489. The concept of housing affordability: six contemporary uses of the housing expenditure-to-income ratio. Housing Studies, 10(4), 471-491] declared that housing researchers should avoid using the term since it is not a robust concept and measurement often lacks validity. In the ensuing 24 years, however, scholars have continued to debate the definition and measurement of housing affordability as well as the prevalence and type of 'housing affordability problems' in various countries. This paper is a think piece which takes a fresh look at housing affordability as a concept which has persisted despite considerable contestation and scepticism about its use. It provides a critical and multidisciplinary assessment of housing affordability starting with early conceptualization of the nexus between economic principles and social norms about housing and living standards to a reworking of housing affordability in the twenty-first century as an urban issue affecting lower and middle-income households in cities, as a consequence of the financialization of housing and urban restructuring. It argues that the housing affordability concept has been repurposed such that the focus is less on understanding housing expenditures in contributing to poverty and disadvantage within the domain of social policy and more on the urban policy challenges of growing inequities in access to urban resources. The paper highlights the challenges for urban policy in adopting and adapting rather than rejecting a multidimensional concept of housing affordability and consequently the importance of new ways of measuring urban housing affordability.

Long-term developments in housing policy and research

“…House price decline, sometimes in combination with repossessions (e.g., Ireland, Spain, UK), resulted in declining completions and transactions (Van der Heijden et al, 2011). Following economic/house price recovery, financialization strategies resumed, particularly targeted at (residential) real estate and land in economically attractive cities (Haffner & Hulse, 2021). When financial capital is not used for new construction, but is mobilized instead to compete for the acquisition of existing dwellings, house price increases contribute to the wealth accumulation of 'housing market insiders' (Kohl, 2021).…”

Llueve sobre mojado: el problema del acceso a la vivienda en un contexto de pandemia

“…Sin embargo, hoy, y especialmente desde la crisis de 2007, la financialización y gentrificación vinculadas a la urbanización en curso han llevado a nuevos tipos de desigualdades espaciales, reformulando la asequibilidad de la vivienda como un problema urbano no solo para los que tienen menos ricos, sino también para los que tienen ingresos medios y la generación más joven. Este es un enfoque diferente al que estudió y entendió la vivienda asequible simplemente centrada en las relaciones entre la vivienda, los gastos no relacionados con la vivienda y la pobreza de ingresos (Haffner y Hulse, 2019).…”

Housing affordability in the 21st century

“…To this dynamic one must also add the generalised worsening of income distribution in advanced countries associated with globalisation (Williamson, 1997) and the struggle to increase the competitiveness of economies, which translate into wage inequalities (Helpman, 2016) and which have exerted a generalised downward force on wages (at the global level) and widened the gap in their distribution, reducing household incomes in many of the world's capitals, and immediately affecting the accessibility of housing (before other consumption). Research analysing this in the 21st century corroborates that this problem has been underestimated and did not emerge in its full severity until the global financial crisis (GFC) (Haffner and Hulse, 2019).…”