THE OECD, together with the European Union, has launched a database that analyses and compares the state of affordable housing across OECD and European Union countries.
The Affordable Housing Database (http://www.oecd.org/social/affordable-housing-database.htm) includes 24 indicators covering three main issues: housing market context, housing conditions, and public policies towards affordable housing. Indicators include among others: tax relief for home owners, housing allowances, public spending on support to social rental housing, homeless population estimates and housing costs over income.
It reveals the challenges countries face in providing affordable housing, which play a major role in reducing poverty and enhancing equality of opportunity, social inclusion and mobility. Housing costs constitute the single highest expenditure item out of household budget, and represent a major financial burden for low-income households in many countries. On average, nearly 15% of tenants and 10% of mortgage payers spend over 40% of their disposable income on housing costs in OECD countries (read the working paper here ). The share is much higher for low-earners: around 40% of low-income households spend over 40% of their income, both for mortgage-payers and private sector tenants. In Croatia, Chile, Greece, Portugal, Spain, the United Kingdom and the United States more than half of households in the bottom quintile of the income distribution spend more than 40% of their disposable income on rent.
A lack of sufficient living space is also a concern, with negative effects of overcrowded dwellings on health and on child outcomes. In nearly all countries, the overcrowding rate increases as household income decreases. In Hungary, Mexico, Poland and Romania overcrowding rates amongst households in the bottom quintile are highest at more than 40% of households. By contrast, less than one in ten low-income households lives in overcrowded dwellings in English-speaking countries, Belgium, Estonia, Malta, Cyprus, Korea, Japan, the Netherlands, Portugal, Spain and Switzerland.
In terms of the policies in place to make housing affordable, housing allowances are one of the most widely used instruments. At 1.4% of GDP, public spending on housing allowances is by far the highest in the United Kingdom, followed by France and Finland. Public spending on housing allowances is close to 0.5% of GDP in Denmark, Germany, the Netherlands, New Zealand and Sweden, and between 0.1 and 0.3% of GDP in Australia, Austria, Bulgaria, Croatia, Czech Republic, Ireland, Japan and the United States.