Entry affordability of employment types: Evidence along the theory of full-time and part-time wage differentials

Abstract

With the prevailing uncertainties in the labour market, existing literature has not adequately covered the link between employment contracts of part-time and full-time employees with entry to the housing market. We examine the current entry affordability of these income earners for strata and non-strata property types using data from 2004 to 2021 and forecasted this index for the period 2022Q1 to 2031Q4 for each of the metropolis of three cities of Greater Sydney. By mirroring the theory of full-time and part-time wage differentials, we empirically found that income supplements like wealth and scaling down housing preferences play an important role in entering the housing market. The forecasted entry affordability shows there is nowhere in Greater Sydney where the mere reliance on NSW median part-time or median full-time income could make entry to the market possible. Also, entry affordability from 2004 to 2021 was extremely unaffordable for both employment contracts. These findings could help developers, homebuyers, lending institutions, and policymakers to make more informed decisions about their activities, manage risks, and plan for the market.