Housing affordability, occupation and location

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Housing affordability, occupation and location

• Judy Yates
• University of Sydney
• Presentation to Shelter NSW seminar, Sydney, 9
  November 2006
• Based on an AHURI project undertaken with
• Bill Randolph and Darren Holloway
• available at http//www.ahuri.edu.au/publications/
  projects/p60279

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Overview

• Motivation for, and background to, research
• Evidence on relation between occupation and
  housing for Sydney
• Conclusions

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Motivation

• Housing costs exclude lower paid workers from
  jobs in high cost regions leads to concerns
• with recruitment and retention problems for
  employers
• with efficient functioning of the city
• with impact of excess commuting

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Can they be your neighbour?
Source http//www.mainehousing.org/news.html
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Background

• Pressures associated with
• Sydney's emergence as a global city
• labour market changes - increased casualisation
  of work growth in part-time work restructuring
  of skills base (growth in skilled and unskilled)
  increased earnings disparities
• income and spatial polarisation in housing markets

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House price differentials in Sydney
inner
middle
fringe
Source NSW Dept of Housing Sales reports,
various years
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Location of low rent dwellings in Sydney(lt150
pw in 2001)
fringe
middle
inner
Source 2001 Census, special request matrix
(Yates and Reynolds, 2003)
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Evidence

• Of 900,000 working households in Sydney in 2001,
• 141,000 working households pay at least 30 of
  household income on housing
• Represents 14 of all working households in
  Sydney (higher than 10 of all working households
  Australia wide)

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Evidence

• High degree of housing stress amongst working
  households
• Incidence of stress greatest in less-skilled
  occupations which are more likely to be
  casualised, part-time, low-paid
• Key workers have below average incidence of
  housing stress

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Occupations with highest incidence of housing
stress, Sydney, 2001
Source 2001 Census, special request matrix
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Occupations with highest numbers in housing
stress, Sydney, 2001
Source 2001 Census, special request matrix
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Proportion in housing stress, selected
occupations, Sydney
Source 2001 Census, special request matrix
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Evidence

• 50 of workers in Sydney live and work in same
  region
• Above average employment self-containment in
  inner and outer regions
• High employment s-c implies out-migration
• Above average residential self-containment in
  inner regions
• High residential s-c implies in-migration

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Sydney SSDs used to define labour market
regionsshading represents average
qualifications, 2001
Source http//www.isa.org.usyd.edu.au/research/po
p1.shtml
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Evidence

• Between 1996 and 2001 generally both workers and
  jobs shifted from high cost to lower cost
  locations
• Greatest job growth was in outer regions
• Greatest loss of workers in inner regions
• Exception is Inner Sydney

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Change in place of residence and work, 1996-2001
High cost
Low cost
Source 2001 Census, special request matrix
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Evidence

• Growth of jobs in inner Sydney associated with
  high skilled occupations
• Growth of jobs in outer regions likely to be
  associated with reductions in unemployment
• Outward migration least for high paid
  occupations greatest for low paid occupations

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Change in place of residence by occupation,
1996-2001
Source 2001 Census, special request matrix
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Change in place of work by occupation, 1996-2001
Source 2001 Census, special request matrix
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Evidence

• Overall, results show
• New economy jobs (computing professionals) are
  increasingly spatially concentrated
• In-service jobs (nursing professionals,
  hospitality workers, cleaners) remain dispersed
• Broadly, outward movement in location of
  residence matched by outward movement in jobs
• Inner Sydney prime exception

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Evidence

• Only 3 regions in Sydney with a net job deficits
  (that is, more jobs than resident workers)

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Sydney SSDs with net job deficits
Lower North (Nth Sydney)
Central West (Pmatta, Ryde)
Inner Sydney (CBD)
Source http//www.isa.org.usyd.edu.au/research/po
p1.shtml
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Place of residence and work
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Evidence

• Those who work in high cost locations tend to
  live close to where they work
• 50 of those who work in Inner Sydney live
  within reasonable commuting distance
  (within a 10 km zone)

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Evidence

• 22 of those who live in Inner Sydney are in
  housing stress (cf 14 for all Sydney)
• 49 of hospitality workers in Inner Sydney are in
  housing stress (cf 33 for all Sydney)
• Increased residential opportunities in Inner
  Sydney have resulted in residential relocation
  within inner zone benefited high by other than
  lowest income households
• 34,000 workers travel in from fringe

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Origin of workers with Inner Sydney workplace,
2001
Source 2001 Census, special request matrix
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Proportion in housing stress, selected
occupations, living in Inner Sydney
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Evidence

• Location and tenure outcomes driven more by
  socio-demographics and household income than
  occupation
• Younger workers (high and low skill) tend to rent
  in inner locations older workers with families
  more likely to purchase in middle and outer
  regions

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Evidence

• However, inner city workers in lower skilled
  occupations more likely to be secondary worker in
  household
• Propensity for inner city living does vary by
  occupation disproportionately greater for
  hospitality workers, nurses and cleaners than for
  all other occupations
• Suggests choice driven by shift work and need to
  locate near to work

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Conclusions

• 1. Claim that structural change has led to
  increasing reliance in inner city
• holds for new economy jobs
• ignores growth of jobs on fringe where increasing
  proportion of workers live
• 2. Study does not provide evidence that
  employers face recruitment or retention problems
  because of affordability problems

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Conclusions

• 3. Study reinforces existing evidence that low
  paid workers face significant affordability
  problems
• greater for those who live in inner city
• results in concentration of young, affluent
  renters without children in inner city
• creates pressure to relocate to lower cost
  locations for low-paid workers who are
  breadwinners
• results in high commuting costs for those who
  remain employed in central location

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Conclusions

• Suggests affordable housing policies needed if
  high cost labour markets are to retain a diverse
  range of workers
• Should focus on low paid occupations, not
  pre-defined key workers