Assessing post-GFC housing affordability interventions: a qualitative exploration across five international cities

Abstract

This paper confronts one of the biggest contemporary public policy conundrums globally; the challenge of decreasing housing affordability for urban residents. Aiming to align the international literature with the multitude of policy responses following the Global Financial Crisis (GFC), the paper explores ‘in-depth’, and via recontextualisation, the policy priorities and strategies designed to combat housing affordability challenges across five international cities from advanced economy countries – Berlin (Germany), Vienna (Austria), Singapore (Singapore), Sydney (Australia) and Auckland (New Zealand). Carefully guided by critical social science and heterodox political economy literatures, and based on an innovative multi-city comparative ethnography (MCCE) centred on 118 in-depth research interviews with key stakeholders, six approaches are singled out as especially prominent: (1) market-based housing supply; (2) direct price/rent control; (3) construction cost reduction; (4) non-market-based housing supply; (5) demand-side interventions; and (6) urban land market interventions. Whereas all strategies face serious tensions, contradictions and implementation barriers, the latter three interventions are more likely to have a positive and lasting impact. Based on these findings, there is a need for normative reorientation and intellectual innovation in order to expand understandings on those three interventions in the name of affordable housing for all.

Keywords:

• global housing affordability crisis
• urban housing markets
• policy interventions
• critical evaluation
• comparative knowledge production

Acknowledgements

I would like to sincerely thank Richard Le Heron, University of Auckland, for his exceptional conceptual guidance and ongoing motivational support. I am also grateful to the helpful and productive feedback of three anonymous referees and the journal editor.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

1 As rentiers derive income from ownership, possession or control of assets that are scarce or artificially made scarce, urban land rent allows rentiers to take advantage of the monopolization of access to land and property without contributing to the productive economy and society.

2 In addition to the interviews, two workshops with approximately 15–20 participants per event were organised in Auckland and Wellington/New Zealand. The responsibilities for conducting interviews, transcription, analyses and interpretation lie solely with the author. Research activities included the translation of the fieldwork notes from German into English. The original interview transcripts can be accessed from the author.

3 ‘Red Vienna’ stands for the city’s inter-war governance arrangements and political agendas under social democratic rule that focused on 60,000 newly-built city-owned flats that were rented out for below-market rents in response to Vienna’s inadequate and expensive housing.

4 This completion rate of 120 houses per year deemed affordable to the majority of Aucklanders means that, with the average household size in Auckland being 3.0 people and net migration to the city standing at almost 30,000 in 2016, only 1.2 percent of new migration-mediated demand was met by affordable new housing stock.

5 Negative gearing is an increasingly controversial form of financial leverage where the loss on a negatively geared investment like a housing investment is tax-deductible against the investor's other taxable income and - especially if the capital gain on the sale is given a favourable tax treatment - allows considerable benefits to housing investors. Countries including Australia and New Zealand allow unrestricted use of negative gearing losses to offset income from other sources.

6 New Zealand’s ‘leaky housing crisis’ arose out of a largely self-regulated construction industry approving untreated timber for new construction in the 1990s and early 2000s. This change of practice under neoliberal ‘at-a-distance’ regulation resulted in weather-tightness problems for many timber-framed buildings and serious, costly legal implications for councils, industry and consumers.

7 Compulsory land acquisition for public development based on the Land Acquisition Act in 1967 was one of the cornerstones of Singapore’s housing model. It was a radical political move that over time has secured most of Singapore’s land for public usage. It has been considered effective in keeping the costs of building houses and industrial premises affordable.

Additional information

Funding

This work was supported by the Fritz Thyssen Stiftung für Wissenschaftsfoerderung [grant number 10.15.1.014SO].