Drive till you qualify : an alternative view of housing affordability

Abstract

Choice of residential location and the transport options which flow from those choices may have significant impacts on family budgets as the combined share of expenditure on housing and transport increases. Thus the perception that housing is cheaper on the urban fringe of Australian cities may not be borne out by reality for income constrained households which are forced to spend a large share of their disposable income on transport to work. This paper builds on previous work reported elsewhere in respect of 2006 data, by examining evidence from Adelaide over two census periods, 2006 and 2011. Using census data and vehicle purchase and running cost data, a model is developed which analyses the proportion of household income devoted to housing and transport for specific locations within the metropolitan areas of both cities. Specifically we aim to address two questions. Firstly, are there affordability advantages for households on low incomes to live in the outer suburbs in the fringe metropolitan areas of Adelaide? Secondly, has there been any change in the affordability of housing, defined by its location and taking transportation costs into account, between the two census periods? The analysis aims both to inform potential housing purchasers of the likely implications for their household budgets of their choice of location and to assist planners in making zoning decisions in respect of urban fringe land and new transport infrastructure.