Housing affordability – it’s more than rent or prices

Housing affordability is about so much more than rents or house prices.

If England’s National Planning Policy Framework were to be believed, housing affordability would mostly be about local house prices, rents and incomes. Planning Practice Guidance only expands this a bit, with vague stuff about households who are homeless or in temporary, overcrowded or unsuitable accommodation.

And, of course, those aspiring to buy their own home.

On this flimsy foundation is built the whole push for car-dependent-sprawl across the whole country.

If those who dreamed up this excuse for BuildBuildBuild had ever engaged with people who are homeless or in temporary, overcrowded or unsuitable accommodation, they would know such people face a perfect storm of challenges to affording any kind of home, going far beyond house prices, lack of habitable accommodation or even rents.

One key affordability factor which English planning policy and the Government’s current greenfield house building obsession both completely ignore is the cost of transport. And here I’m talking about monetary costs, not the cost to the planet.

The BuildBuildBuild brigade will tell you this is all because the wicked planning system prevents mega-wealthy mega-builders from building on farmland beyond the urban boundary.

But they’re wrong. The UK has disastrously high public transport fares and many areas lack decent services, particularly the remote greenfield garden suburbs Government policy urges us to proliferate.

 A 100-year default development mode of low-density, car-dependent and public-transport-hostile sprawl has left many people hopelessly dependent on expensive motoring to get to work, shops, education and healthcare. Promoting more of it just makes things worse.

A recent study of workers dependent on public transport in Chicago showed how housing and public transport costs (H+T) affect people disproportionately according to their incomes. The study covered a US city where public transport usage is low, but that’s also the case in many UK cities.

Americans typically spend around a quarter of their income on housing and around an eighth on transport. And, just like here, poorer households have to make trade-offs between housing and transport costs.

While city centre housing costs may force people to outer suburbs, housing affordability studies concentrate on the relationship between housing costs and income, very much like English planning guidance.

The study proposes a new method to estimate housing and public transport affordability (H+T). It found that, in Chicago, wealthier folks had relatively high H+T affordability as you’d expect but, for the less affluent, transport costs are significant in influencing location affordability.

Chicago is different in many ways to UK cities though its pattern of affluent areas and poorer areas is all too familiar. So too is the finding that people who live in affluent areas, regardless of whether they own their own home, have good levels of H+T affordability while those in poorer areas have low H+T affordability, regardless of housing tenure.

“The areas with poor H+T affordability are also areas of high unemployment and only people with disabilities, over-65s and Medicare recipients enjoy concessionary fares,” it says, highlighting a major cause of the disparity.

Unlike in England, however, the solution isn’t seen as building expensive market homes at greenfield locations far away.

“Expanding the current concessionary fare scheme to include more socially disadvantaged groups such as low-income people would enhance their H+T affordability,” it says. “Besides, more affordable housing programmes should be rolled out in neighbourhoods with low H+T affordability… in tandem with the concessionary fare scheme.”

Levels of inequality in the UK are also dire and politicians need reminding that, as well as the urgent need to level up regionally, there is also an urgent need to level up locally. A perfect storm of higher prices and benefit cuts is brewing for the lowest paid.

Genuinely affordable housing and concessionary fares for the disadvantaged and people on low incomes could make a major contribution to mitigating the effects of this..

Liu d, Kwan M-P, Kan Z, Song Y. An Integrated Analysis of Housing and Transit Affordability in the Chicago Metropolitan Area. Geogr J. 2021;187:110-126

Jon Reeds