Housing Financial Stress in Australia: An initial analysis of households reporting payment difficulties

1. Housing Financial Stress in Australia: An initial analysis of households reporting payment difficulties Scott Baum Griffith University Jung Hoon Han University of New South Wales

2. Outline • Background to this study • Australian State of Play • Households reporting housing payment difficulties

3. Background • Part of a broader study • Looking at the impacts of the post-GFC economic and social structure on performance of local communities and households • Study in Employment vulnerability during the GFC • One of the impacts we hypothesised was a potential change or shift in the patterns/ makeup of households suffering housing financial stress

4. Background

5. Australian research

6. General media interest

7. Australians for affordable housing

8. Fujitsu consulting ‘stress-o-meter’

9. Fujitsu consulting ‘stress-o-meter’ Households with low paid blue collar or service sector jobs, living in urban fringe localities, low education and non-Anglo ethic background

10. Fujitsu consulting ‘stress-o-meter’ New home purchasers on new estates with low value housing

11. Fujitsu consulting ‘stress-o-meter’ Younger households concentrated in lower ses, higher than average density suburbs employed in vulnerable jobs

12. Fujitsu consulting ‘stress-o-meter’ Account for 60% of households estimated to be in mortgage stress

13. Causes of stress

14. Change in stress

15. Changes in stress

16. Geography of stress

17. Our preliminary work • On the back of this existing data we want to know: • What are the patterns of housing financial stress (esp in the post-GFC world) • Are we seeing different / new patterns • What are the patterns of people transitioning into and out of stress

18. Our preliminary work • Data: • Household Income and Labour Dynamics Australia (HILDA) survey • Possible indicators • Housing payments : income ratios • Could not meet repayments • Since January 200x did any of the following happen to you because of a shortage of money? b) Could not pay the mortgage or rent on time

19. Our preliminary work • Treated the data sets • as cross sectional • Longitudinal (transitions) • Considered • Demographic and other patterns • Major life changes • Undertaken preliminary regressions

20. Cross section analysis

21. The 2009 data

22. Life changes 2009

23. Proportion households recording payment problems

24. Proportion of households reporting payment difficulties who have recorded life change

25. Financial security/ problems

26. Financial security/ problems

28. Transitions

29. Proportion of households by transition type

30. Percentage of households by number of events

31. Life changes by transition 2008-2009

32. Financial security/ problems

33. Financial security/ problems

37. Some brief conclusions • Some potentially interesting patterns • Still (way) more analysis to do • Investigate in more detail transitions • Possibly use a pooled data set (pooled across waves) • Introduce some aggregate housing market variables

38. The end……..