Ulster University Logo

Analysing Housing Market Affordability in Northern Ireland: towards a better understanding

McCord, Michael, Davis, Peadar, Haran, Martin and McCord, John (2016) Analysing Housing Market Affordability in Northern Ireland: towards a better understanding. International Journal of Housing Markets and Analysis, 9 (4). pp. 554-579. [Journal article]

[img] Text (PDF of accepted manuscript) - Accepted Version
762kB
[img] Text - Supplemental Material
Restricted to Repository staff only

43kB

URL: http://dx.doi.org/10.1108/IJHMA-09-2015-0054

DOI: 10.1108/IJHMA-09-2015-0054

Abstract

Purpose: Although the problem of housing affordability has been widely discussed, the theoretical underpinnings of the concept have received less attention. It has become increasingly evident that more holistic insights and integrated approaches are needed to provide a platform to define affordability, in order to influence research and policy discourse.Design/methodology/approach: Given the increasing importance of affordability within housing policy reform, this paper seeks to ‘unearth’ the most important prognosticators of affordability. The paper employs principal component analysis to determine how affordability, as a key policy tool, should be analysed. In addition, cointegration techniques, Granger causality and impulse response analysis are applied to test the movement and shocks of the key affordability indicators and two common affordability metrics.Findings: The principal conclusions stemming from this paper demonstrate that affordability is a multifaceted policy concept influenced by financial access (purchase) costs and the repayment costs of housing services which are correlated and interchangeable, but significantly were found not to be cointegrated.Originality/value: Understanding the nature of housing market affordability remains problem for policy makers. This paper adds to the debate and empirical understanding of the cyclic nature of affordability and how it is defined. It shows that there are intricate causal short-term relationships between the key affordability indicators. This is problematic for contemporary housing policy and the key directions in which policy must turn.

Item Type:Journal article
Keywords:Housing affordability, housing policy, principal component analysis, Johansen Cointegration, Impulse response, Granger causality
Faculties and Schools:Faculty of Social Sciences > School of Law
Faculty of Art, Design and the Built Environment
Faculty of Social Sciences
Faculty of Art, Design and the Built Environment > School of the Built Environment
Research Institutes and Groups:Built Environment Research Institute > Centre for Research on Property and Planning (RPP)
Built Environment Research Institute
ID Code:33027
Deposited By: Dr Michael McCord
Deposited On:26 Jan 2016 12:12
Last Modified:29 May 2017 15:50

Repository Staff Only: item control page