Forever home ideal for all
Taxpayer foots bill for ill health and crime-related issues found in rentals, research finds
Getting 2000 people out of a rental into their forever home could save the Government $17.5 million over 15 years, new research suggests.
The findings are part of a trio of research papers released today examining social and economic costs of renters versus those living in their own home.
It suggested getting people into their own home could alleviate a number of issues, such as ill health linked to poorer quality rentals and a lack of community engagement among tenants that could be a factor in criminal offending, and thus save the Government spending on health and corrections.
Commissioned by the New Zealand Housing Foundation, a charitable trust, the research looks at how the insecurity of a rental environment could burden individuals and government.
One study, carried out by Business Economic Research (Berl), estimated helping renters move into their own home could save millions in taxpayers dollars over time.
Berl analysed Statistics New Zealand data around costs incurred by social housing tenants, private tenants and home owners in the areas of health, corrections and social benefits. It also took into account the amount of tax each group paid.
The researchers drew on established literature providing evidence that homeowners tended to do better in terms of health, wealth and education and were less involved in crime. They hypothesised over 15 years former tenants would eventually mirror the behaviour of longtime home-owners.
On this assumption the researchers used the data around the costs incurred and tax paid by each group to look at how things would change if social renters were transitioned into their own home.
In the first scenario, when 1000 private renters became owner-occupiers, it estimated the potential net fiscal saving over 15 years to be $6.4m. If the same number of social renters were moved into a house they owned, this figure was almost double — $11.1m.
The Housing Foundation said the research showed actively supporting affordable home ownership for low and middle-income families was beneficial for all.
“Moving people along the housing continuum reduces the long-term liability to the Crown, improves household outcomes, builds communities and is morally and fiscally the right course to take.”
A second piece of research, an analysis of international studies carried out by the Family Centre Social Policy Research Unit, supported Berl’s findings.
It found home-ownership was linked to better health, crime and educational outcomes — even once a person’s socio-economic status was taken into account — benefits it said could carry on into future generations.
The analysis said the research had not addressed mortgage or rent stress and acknowledged unaffordable housing options of any kind would “almost certainly lead to negative health and social outcomes”.
The third piece of research released by the foundation looked at the experiences of those living in its development in Waimahia Inlet. The Nexus study, based on data collected in November, found most reported a good quality of life as well as improvements in their health and that of their children who therefore did better at school.
Earlier this year, new data from Statistics NZ showed home ownership was nudging a new low — with the least number of Kiwis living in their own home in 66 years.
The Herald has sought comment from Housing Minister Amy Adams but it wasn’t received prior to deadline.