Affordability Targets: Implications for Housing Supply
Funded by: Office of the Deputy Prime Minister
November 2004 to May 2005
Background, summary and aims
This is primarily a modelling project designed to quantify, at a regional scale, the relationship between affordability of housing and housing construction. The ratio of lower quartile house prices to incomes is used as the main indicator of affordability. In this project, therefore, the model needs to assess the required level of housing construction in each region in order to meet affordability targets. But the type of models that are required for the analysis have never been fully developed. Although national econometric models have been used within government since the late sixties, comprehensive regional and local housing models that are required for affordability analysis simply do not exist at the current time. The academic literature provides valuable insights into part of the jigsaw but the components have never been brought together into an integrated whole. This is the challenge of the project.