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HOUSING TENURE

Adding net imputed rent to income has a significant effect on the ranking of people when examined in relation to their housing tenure. Table 6.1 shows the proportion of households, by tenure type, in each of the person weighted income quintiles, both before and after net imputed rent is added to their incomes.

6.1 Housing tenure, by income quintiles, with and without imputed rent, 2005-06
	Owner without a mortgage	Owner with a mortgage	Renter from state/territory housing authority	Other subsidised renter(a)	Market renter(b)	Occupied rent free	All households(c)
	%	%	%	%	%	%	%
Equivalised disposable household income - quintile
Lowest	47.6	13.8	13.2	4.0	18.1	2.5	100.0
Second	39.9	27.6	4.5	2.7	22.8	2.1	100.0
Third	28.6	41.9	1.5	2.3	23.8	*1.5	100.0
Fourth	24.6	47.3	*1.0	2.0	23.5	1.4	100.0
Highest	26.7	50.3	*0.4	1.6	19.6	1.3	100.0
All households	34.3	35.0	4.7	2.6	21.3	1.8	100.0
Second and third deciles	45.9	19.6	7.6	2.9	21.2	2.1	100.0
Adjusted equivalised disposable household income, incl. imputed rent
Lowest	30.1	21.7	13.9	4.5	27.7	1.3	100.0
Second	44.8	25.9	5.5	2.9	18.4	2.1	100.0
Third	34.6	38.5	1.6	1.6	21.5	1.8	100.0
Fourth	29.6	44.3	*1.0	2.2	20.6	1.9	100.0
Highest	32.3	45.7	*0.4	1.6	18.0	2.0	100.0
All households	34.3	35.0	4.7	2.6	21.3	1.8	100.0
Second and third deciles	43.7	21.7	11.3	3.5	17.6	1.7	100.0
* estimate has a relative standard error of 25% to 50% and should be used with caution
(a) Includes households renting from: a parent or other relative not living in the same household; an employer; a housing cooperative or community/church group.
(b) Includes households renting from: a real estate agent; an unrelated person not living in the same household; or an owner/manager of a caravan park.
(c) Includes participants in rent-buy/shared equity schemes and life tenure schemes.

Households in the lowest equivalised disposable household income quintile have the highest incidence of full ownership of their home. In 2005-06, almost one half of households (48%) in the lowest income quintile were owners without a mortgage. However the effect of adding net imputed rent to income reduced this proportion to less than one third (30%). This change predominantly reflects retirees with low incomes who own their own homes moving up into the next highest income quintile.

The decrease in the proportion of households which owned their home without a mortgage in the lowest income quintile resulted in an increase in the proportion of all other housing tenures in the lowest income quintile, except for households who occupy their dwelling rent-free, for which imputed rent has increased their incomes in a similar manner to those which own a home outright. The most significant proportionate increase in tenure type in the lowest income quintile was seen for owners with a mortgage (from 14% up to 22%), for whom the costs of servicing their mortgage reduced their net imputed rent incomes.