Housing affordability in England.

Triggered by the state of the housing market and a change in the housing association
subsidy system, housing affordability became a topical issue of discourse in Britain
towards the end of the 1980s. Yet, there is little research both on the extent of the
problem at the national level and how affordability should be measured. This research
attempts to advance understanding in these issues based on data from the 1991 Family
Expenditure Survey and the 1988 General Household Survey. In this thesis, a new
definition of the residual income measurement has been proposed and threshold
affordability ratios has also been established using a composite approach to affordability
measurement combining the ratio and the residual income measurement, in additional to
an experimentation on a behavioral approach to the measurement of affordability.
Findings in this thesis suggest that, measured by the ratio measurement and the
traditional residual income measurement, about a quarter of households in 1991 were in
unaffordable housing. Social tenants and tenants in the unfurnished private rented
sector, lone parents, the elderly persons and households with unemployed household
heads and claimants of housing benefit were more likely to be in unaffordable housing.
However, there is no evidence in support of distinct patterns in household expenditure
between households who were affordable to housing and those who were unaffordable.
It is also controversial to regard households who were unaffordable to housing but at the
same time over-consumiing housing to be in voluntary unaffordability problem owing to
the difficulties such households would have in adjusting their level of housing
consumption. This thesis also points to the close relationship between housing
affordability, housing benefit and social tenancy which suggests the inadequacy of the
housing benefit system and state provision of housing in protecting households from the
problem of housing affordability. A section of this thesis was devoted to the examination
of the ability of tenants to buy in the late 1980s where tenure preference has been
incorporated in the measurement of such ability. It was found that the majority of
tenants in 1988 could not afford to buy and tenants living in London and the South East,
single person households, lone parents and households on a low income were the least
able to afford buying. Though the Right to Buy scheme would improve the capacity of
these households in council housing to become home owners, they are still households
who were the least able to buy.