Australian Property News

Most escape housing stress within a year

Posted on Friday, July 03 2009 at 2:28 PM

Most Australians who experience housing stress are able to escape their affordability worries within a year, a study tracking housing affordability between 2001 and 2006 has found.

However, there were a small number for whom housing affordability stress was a more permanent problem, The dynamics of housing affordability report from the Australian Housing and Urban Research Institute suggested.

The report found that most Australians who were already in affordable housing in 2001 tended to survive in affordable housing over five or so years.

"A minority do drop into housing affordability stress but manage to quickly climb back into affordable housing," study authors Gavin Wood and Rachel Ong wrote.

"We find that employment, the presence of children, mortgage equity withdrawal and residential moves are particularly important factors shaping the dynamics of affordable housing."

The study, which tracked the housing affordability trajectories of a nationally representative sample of Australians over six years, found that the unemployed and younger couples with children were the most susceptible to housing stress.

However, only the unemployed and non-participants in the labour force tended to experience housing stress on a long-term basis.

"Their housing affordability problems appear chronic and warrant long-term support and assistance if their position is to be alleviated," the study said.

Among the group of people that quickly escaped mortgage stress, "a surprisingly large number churn in and out of unaffordable housing".

"While most Australians (experiencing) a first spell of housing stress exit within a year, an improvement in housing affordability tends to be temporary for a sizeable number. It is not clear why this is so."