HOUSING


HOUSING UTILISATION

The concept of housing utilisation applied in the SIH is based upon a comparison of the number of bedrooms in a dwelling with a series of household demographics such as the number of usual residents, their relationship to one another, age and sex. There is no single standard measure for housing utilisation. However, the Canadian National Occupancy Standard (CNOS) is applied in the SIH and is widely used internationally.

The CNOS for housing appropriateness is sensitive to both household size and composition. The measure assesses the bedroom requirements of a household by specifying that:

• there should be no more than two persons per bedroom;
• children less than five years of age of different sexes may reasonably share a bedroom;
• children less than 18 years of age and of the same sex may reasonably share a bedroom;
• single household members 18 years and over should have a separate bedroom, as should parents or couples; and
• a lone person household may reasonably occupy a bed sitter.

The CNOS variable compares the number of bedrooms required with the actual number of bedrooms in the dwelling. Households living in dwellings where this standard cannot be met are considered to be overcrowded.


HOUSING COSTS

Housing costs are the recurrent outlays made by household members in providing shelter for themselves. The data collected on housing outlays in the SIH are limited to major outlays on housing, that is, mortgage repayments, rent, property and water rates as well as body corporate fees.

Only payments which relate to the dwelling occupied by the household at time of interview, that is, a respondent's usual place of residence, are included. Housing costs only include mortgage/loan payments if the purpose of the loan at the time it was initially taken out was primarily to buy, build, add to, or alter the occupied dwelling.

• There are a number of limitations with the housing costs information obtained in the SIH, due to practical data collection considerations. These limitations should be especially borne in mind when comparing the housing costs of different tenure and landlord types, that is when comparing the costs of owner occupiers with the costs of renting households, and when comparing the costs of households renting from state and territory housing authorities with the costs of other renters.
• Households are sometimes reimbursed some or all of their housing costs. Commonwealth Rent Assistance (CRA), paid by the Australian Government to qualifying recipients of income support payments is an important type of reimbursement of relevance to these statistics.
• Mortgage repayments made by owners with a mortgage include both the interest component and the principal or capital component. For many purposes it is more appropriate to consider repayments of principal as a form of saving rather than as a recurrent housing cost. It reflects the purchase of a housing asset by increasing the equity in the property held by the household and is an addition to the wealth of the occupants.
• A fuller measure of housing costs include a range of outlays necessary to ensure that the dwelling can continue to provide an appropriate level of housing services. These include repairs, maintenance and dwelling insurance, and are costs that tend to be incurred by owner occupier households but not by renting households.

Housing Costs and Household Income

Housing costs are often a major component of total living costs. Therefore housing costs are often analysed as a proportion of total income, sometimes referred to as affordability ratios. However, comparisons between these measures are subject to the limitations of housing cost estimates obtained in the SIH that are described in the previous paragraph. Housing affordability ratios derived from SIH data are further impacted by the inclusion of CRA in the value of income collected. CRA is estimated, on average, to represent about 5% of the reported income of households receiving CRA and about 1% of the reported income of all households renting from landlords other than the state/territory authorities.

To illustrate the difficulties discussed above, consider two couples that are renting their dwellings. Both receive government pensions of $400 per week. One rents from a public housing authority and pays rent of $100 per week. The other pays $135 rent per week to a private landlord and receives CRA of $35 per week. In SIH, the housing costs of the latter household would be recorded as $135 and their income would be recorded as $435. The couple renting from the public housing authority has a housing costs/income ratio of 25%. The housing costs/income ratio for the latter household would be derived as 31%. However, if CRA receipts are excluded from housing costs and income, the housing costs/income ratio for the latter couple is also 25%, highlighting that there is no substantive difference between the housing costs or income situation of the two couples. The treatment of CRA is of particular importance when considering changes in affordability ratios over time, since there has been a shift from providing public housing to providing CRA as a means of supplying affordable housing to low income people.

While housing costs can be a major component of total living costs, the difference between the housing costs of a larger household and a smaller household would not be expected to be as great as the difference in many other costs, such as food or clothing. In other words, larger households can be expected to experience economies of scale in the supply of housing. This means that if a larger household and smaller household both have the same standard of living, it could be expected that on average the larger household will have a lower housing costs/income ratio. Therefore relatively high housing costs/income ratios are more of a concern with respect to larger households than smaller households. This should be borne in mind when comparing ratios across different household sizes.

In comparing households' housing costs with their income, it should be noted that households have a variety of housing preferences. Some people may choose to live in an area with high property values because it is close to their place of employment and therefore they have lower transport costs. Some people choose to incur relatively high housing costs because they prefer a relatively high standard of housing compared with other consumption possibilities. High mortgage repayments might reflect a choice to purchase a relatively expensive home, or pay off a mortgage relatively rapidly, as a form of investment.

Housing stress

One way of examining housing affordability is to look at households whose spending on housing costs is likely to impact on their ability to afford other living costs such as food, clothing, transport and utilities. A common threshold is the proportion of households spending more than 30% of their income on housing costs.

Higher income households have greater capacity to spend higher proportions of their income on housing costs without impacting their ability to meet basic living costs. The application of a 30% housing costs cut off is commonly applied to households whose equivalised income falls in the bottom 40% of Australia’s income distribution (i.e. low income households). Low income households that spend 30% or more of their gross income on housing costs are often referred to as being in ‘housing stress’.

Most affordability measures, including the 30/40 rule, exclude households that report nil or negative income. The 30/40 rule may also exclude those reporting extremely low incomes (those in the bottom 10% of equivalised disposable household income distribution), as data suggests this group includes households with temporarily low or irregular incomes, or accumulated wealth that support their consumption.

Measures of housing stress are often restricted to renters as the nature of mortgage payments can make analysis of owners with a mortgage in housing stress difficult.


CYCLICAL HOUSING ITEMS

Additional Housing Content Collected in 2013–14

The SIH 2013–14 included additional housing topics to enable reporting of the broader housing circumstances of households. The ABS collects additional information on housing in the SIH every six years. The additional information was collected in 2007–08 and published in Housing Mobility and Conditions, 2007–08 (cat. no. 4130.0.55.002). For 2013–14, the additional housing content is published in an additional data cube available with Housing Occupancy and Costs, Australia (cat. no. 4130.0).

The collection of additional housing topics with 2013–14 SIH enables comparisons of the non-Indigenous results with similar items collected in respect of Aboriginal and Torres Strait Islander Australians in the National Aboriginal and Torres Strait Islander Social Survey (cat. no. 4714.0), scheduled for release in 2016.


ADDITIONAL TOPICS

The additional housing topics selected for inclusion in 2013–14 SIH, include:

• Housing mobility:
  • Number of years lived in current dwelling
  • Number of times moved in last 5 years
  • Structure of previous dwelling
  • Geographical area of previous dwelling
  • Tenure type of previous dwelling
  • Previous landlord type or provider of rent free dwelling
  • Reasons for last move
  • Likelihood of moving in next 12 months
  • Barriers to moving
• Housing condition and dwelling characteristics:
  • Types of major structural problems
  • Number of major structural problems
  • Sources of water for dwelling
  • Sources of energy used in dwelling
  • Satisfaction with current dwelling
• Home purchase for first home buyers
  • Source(s) of home deposit
  • Size of home deposit
  • Whether received monetary assistance to purchase dwelling
• Household finances of owners with a mortgage
  • Whether have refinanced loan for property in the last 2 years
  • Reason(s) for refinancing
• Rental arrangements and the affairs of renters
  • Length of lease
  • Amount of bond paid
  • Whether have been refused rental accommodation in last 5 years
  • Number of years that respondent has rented (in all rentals) - recent continuous

ABS RELEASES

The regular and additional housing data items collected in SIH 2013–14 will be available for use on the Microdata: Income and Housing, Australia, 2013–14 (cat. no. 6541.0.30.001), expected to be released in late 2015.

Summary housing data from SIH 2013–14 will be released from September 2015 in the publication Housing Occupancy and Costs, Australia (cat. no. 4130.0). This will present the housing data that are collected every two years in the SIH. It will include data on housing occupancy and costs, and relate these to characteristics of occupants and dwellings such as tenure, family composition, dwelling structure, age of household reference person
and income.

The additional housing content collected in the 2013–14 SIH will be published in an additional data cube attached to the publication Housing Occupancy and Costs, Australia (cat. no. 4130.0). Data on mobility, condition of dwelling, satisfaction with dwelling, feelings of safety, difficulty with transport, re-financing, first home buyers and renters will be included.