The gap between housing affordability and affordable house: A challenge for policy makers

Abstract

Much of the literature defines housing affordability as the relationship between household income and housing expenditure (housing costs). Affordable housing refers to the affordability of the household to own or rent the housing. Housing becomes unaffordable if the housing costs exceed the income of the household. Thus, the objective of this paper is to define the difference between housing affordability and an affordable house and to identify the factors influencing the gap between housing affordability and an affordable house. To achieve the objectives of this paper, 28 variables or factors have been identified. These variables or factors are then analysed by using the descriptive method of analysis. After analysing 28 identified variables or factors, the findings show that a high house price, a high monthly repayment, the type of property ownership and the land area either extremely or moderately influenced the gap between housing affordability and an affordable house.