How Many Rental Households Need Affordable Housing Policies?

Abstract

The purpose of this study is to examine rental housing affordability to verify the determinant for rental housing affordability. Furthermore we measure the relative marginal change of overall demand of affordable housing as we adopt a standard of living from advanced countries such as U.K. and Japan. Using Residual Income Approach and Housing Quality Approach, we measure the number of total 1.5 million household are in need of affordable housing policy. Also we measure total 0.41 million household are counted as a group necessary for affordable housing policy. The income effect has positive impact on this measure which implies an increased income in each household decreases a possibility to be in a group necessary for affordable housing policy. If we assume a standard of living from advanced countries such as UK, and Japan, the percentage of group necessary for affordable housing policy has increased by 3% and 6%, respectively. We conclude that it is important to specifically measure the rental housing affordability in order to provide a necessary various affordable housing policy.