Elsevier

Social Science & Medicine

Volume 94, October 2013, Pages 91-97
Social Science & Medicine

Housing affordability and mental health: Does the relationship differ for renters and home purchasers?

https://doi.org/10.1016/j.socscimed.2013.06.023Get rights and content

Highlights

  • Housing costs impact on health and wellbeing, but do effects differ by tenure type?

  • We used data from a large, nationally representative Australian panel survey.

  • Only for renters did we observe poorer mental health when housing was unaffordable.

  • Unaffordable housing differentially affects mental health of renters and owners.

  • It may be appropriate to tailor policy responses according to housing tenure type.

Abstract

There is increasing evidence of a direct association between unaffordable housing and poor mental health, over and above the effects of general financial hardship. Type of housing tenure may be an important factor in determining how individuals experience and respond to housing affordability problems. This study investigated whether a relationship exists between unaffordable housing and mental health that differs for home purchasers and private renters among low-income households. Data from 2001 to 2010 of the longitudinal Household, Income and Labour Dynamics in Australia (HILDA) survey were analysed using fixed-effects linear regression to examine change in the SF-36 Mental Component Summary (MCS) score of individuals aged 25–64 years, associated with changes in housing affordability, testing for an interaction with housing tenure type. After adjusting for age, survey year and household income, among individuals living in households in the lower 40% of the national income distribution, private renters in unaffordable housing experienced somewhat poorer in mental health than when their housing was affordable (difference in MCS = −1.18 or about 20% of one S.D. of the MCS score; 95% CI: -1.95,-0.41; p = 0.003) while home purchasers experienced no difference on average. The statistical evidence for housing tenure modifying the association between unaffordable housing and mental health was moderate (p = 0.058). When alternatives to 40% were considered as income cut-offs for inclusion in the sample, evidence of a difference between renters and home purchasers was stronger amongst households in the lowest 50% of the income distribution (p = 0.020), and between the 30th and 50th percentile (p = 0.045), with renters consistently experiencing a decline in mental health while mean MCS scores of home purchasers did not change. In this study, private renters appeared to be more vulnerable than home purchasers to mental health effects of unaffordable housing. Such a modified effect suggests that tenure-differentiated policy responses to poor housing affordability may be appropriate.

Introduction

Housing is an important social determinant of health, and the link between housing and health is widely acknowledged (Braubach, 2011, Commission on Social Determinants of Health, 2008). Until recently, much of the housing and health research has focussed on links between physical characteristics of housing (e.g. exposure to toxins, cold, damp) and physical health (Evans et al., 2000, Free et al., 2010, Lloyd et al., 2008). In Australia, however, where most of the housing stock is relatively new and typically of good quality, and where most of the population lives around the more climatically mild coast (Australian Bureau of Statistics, 2001), physical aspects of housing and their effects on health may be less important than the affordability of housing, especially with regard to mental health. In this vein, it has been suggested that in Australia, housing may be a “health promoting resource accessed through income” (Waters, 2001, 12). Housing affordability is therefore a potentially important and under-recognised mechanism for influencing health, in the Australian context at least.

There is strong empirical evidence that poor housing affordability is related to poor mental health. A robust longitudinal analysis of the British Household Panel Survey found that anxiety could be directly attributed to the inability to meet ongoing housing costs (Pevalin et al., 2008). Similarly, in an Australian study it was found that lower-income individuals whose housing became unaffordable experienced, on average, a small but highly statistically significant decline in their mental health even after contemporaneous changes in income were accounted for (Bentley et al., 2011). Importantly, both of these papers indicate that poor housing affordability appears to have an effect on mental health over and above the effects of general financial hardship.

There is also a growing evidence base that relates unaffordable housing to more indirect “trade-offs that may harm health” (Pollack et al., 2010, 515). Kirkpartrick and Tarasuk (2011), for example, found a positive association between unaffordable housing and food insecurity. Housing costs are the largest average expenditure item for Australian households (Australian Bureau of Statistics, 2010) and are often paid before other household expenses. Higher housing costs can therefore result in difficulty affording non-shelter necessities, such as food, transport, or medical care. This primacy of housing costs in household budgets is central to debates about housing affordability and is well documented (Jewkes and Delgadillo, 2010, Stone, 2006).

In this paper the effect of poor housing affordability on the mental health of individuals is considered, with particular attention paid to whether the relationship between housing affordability and mental health might be modified by a second housing-related determinant – tenure. There is a substantial evidence base on the association between type of housing tenure and health (e.g. Gibson et al., 2011, Macintyre et al., 2003) and social welfare policies commonly focus on tenure-based assistance (for example by providing social rented housing, or private market rent assistance to households unable to access home ownership). On the other hand, our recently published analysis of the relationship between housing tenure and mental health in Australia found that although mental health differences were observed between tenure types, these differences are most likely attributable to confounding by unobserved characteristics of people in different tenure types rather than a causal effect of tenure (Baker et al., 2013). In that study, we concluded that, unlike poor housing affordability, tenure does not have an intrinsic effect on mental health in Australia. What remains unclear, however, is how affordability and tenure might be interacting to influence health outcomes. While a recent cross-sectional study from the U.S. looked at this intersection in relation to various health outcomes (Pollack et al., 2010), our study is the first that we know of to use longitudinal data to explore this relationship, and is the first to examine the relationship in an Australian setting.

In Australia, a perceived tenure hierarchy exists. Home ownership is most highly sought, private rental is widely regarded as a tenure of transition towards home ownership, and social housing is seen as welfare housing for those unable to own or rent in the private market (Beer et al., 2011). Average mental health differs clearly across the three main tenure types in Australia, and these differences align with the hierarchy described above (Baker et al., 2013). We suggest that tenure may be an important factor in determining how individuals experience and respond to housing affordability problems. For example, increased housing costs could be more detrimental to the mental health of renters than home purchasers, because, unlike mortgage payments, rental payments aren't an investment in an asset. On the other hand, many private renters may find it easier to relocate to a less expensive residence if their situation changes, while owners and purchasers have less flexibility to move. Differences such as these might be masked when associations are investigated at the level of the broader population only, and when interactions between affordability and tenure are not examined.

In this paper, data from a longitudinal Australian study are used to examine whether there is a relationship between changing housing affordability and changing mental health that differs according to tenure type. Specifically, we investigate whether home purchasers and private renters experienced different mental health effects when their housing became unaffordable. Such repeated measures studies, in the absence of randomised trials, provide a strong study design for causal inference of short-run mechanisms. As the same people are followed over time to observe within-individual change in mental health following change in housing affordability, all time-invariant confounding factors (e.g. sex, early life socioeconomic position, personality, ethnicity) drop out of the analysis.

Section snippets

Data

This study uses data from the Household, Income and Labour Dynamics in Australia (HILDA) survey (Summerfield et al., 2011). HILDA is an ongoing panel survey of Australian households and individuals, based upon a nation-wide probability sample and focussed on income, employment, health and wellbeing. HILDA has been conducted annually since 2001. Information is collected from household members aged 15 years and over using face-to-face interviews and self-completion questionnaires. All annual

Results

The analytic sample based on the 40% cut-off comprised 2916 individuals contributing an average of 4.1 observations each, of which 4362 observations were from renters and 7702 observations were from home purchasers. Of the total observations in that analysis, 909 represented transitions from affordable to unaffordable housing and 773 represented transitions from unaffordable to affordable housing. Not all observations represent a transition, as analyses utilise all observations from individuals

Discussion

This analysis suggests that renters and home purchasers experience unaffordable housing differently in terms of a mental health impact. We found a small but statistically significant difference (about 20% of one S.D. lower) in the mental health scores of private renters when their housing was unaffordable compared to when it was affordable. In contrast, the mental health scores of home purchasers were, on average, the same regardless of whether or not their housing was affordable. Testing for

Funding

This work was funded by the Australian Research Council (Grant Number: LP100200182). Tony Blakely is funded by the Health Research Council of New Zealand.

Acknowledgements

This paper uses unit record data from the Household, Income and Labour Dynamics in Australia (HILDA) Survey. The HILDA Project was initiated and is funded by the Australian Government Department of Families, Housing, Community Services and Indigenous Affairs (FaHCSIA) and is managed by the Melbourne Institute of Applied Economic and Social Research (Melbourne Institute). The findings and views reported in this paper, however, are those of the author and should not be attributed to either

References (33)

  • E. Baker et al.

    The mental health effects of housing tenure: causal or compositional?

    Urban Studies

    (2013)
  • A. Beer et al.

    Housing policy, housing assistance and the wellbeing dividend: developing an evidence base for post-GFC economies

    Housing Studies

    (2011)
  • R. Bentley et al.

    Cumulative exposure to poor housing affordability and its association with mental health in men and women

    Journal of Epidemiology and Community Health

    (2012)
  • R. Bentley et al.

    Association between housing affordability and mental health: a longitudinal analysis of a nationally representative household survey in Australia

    American Journal of Epidemiology

    (2011)
  • M. Braubach

    Key challenges of housing and health from WHO perspective

    International Journal of Public Health

    (2011)
  • Commission on Social Determinants of Health

    Closing the gap in a generation: Health equity through action on the social determinants of health

    (2008)
  • Cited by (120)

    View all citing articles on Scopus

    The data used in this paper were extracted using the Add-On package PanelWhiz for Stata®. PanelWhiz (http://www.PanelWhiz.eu) was written by Dr. John P. Haisken-DeNew ([email protected]). See Haisken-DeNew and Hahn (2006) for details. The PanelWhiz generated DO file to retrieve the data used here is available from the authors upon request. Any data or computational errors in this paper are the authors.

    View full text