Affordability Index For Transportation And Housing: Index Design And An Application

The issue of housing affordability has attracted wide attention and concern from almost every aspect of the society. According to the theory of urban spatial structure, urban land use and urban transportation are closely integrated. In the spatial models, the rent (housing costs) is negatively correlated with transportation costs. Therefore, one cannot comprehensively appraise housing affordability by simply considering the ratio between housing costs and income. Under such theoretical and empirical background and in order to provide a more precise and practical spatial distribution of housing affordability, this paper establishes a housing affordability index which integrates both transportation costs and housing costs. In addition, a practical example of Beijing is provided.Using zone-level data of household income, housing cost and transportation cost of 64 residential zones in Beijing, this paper calculates the new affordability index for six types of households sorted according to housing unit type and car-ownership. This thesis uses a new information tool, Transportation and Housing Affordability Index(THAI), to quantify the impact of transportation cost on the affordability of housing in Beijing. The indices are regressed on the distance from block to urban centre to examine the spatial distribution of the THAI index. The THAI among households with cars, households without cars and all households are compared and analyzed later on. Later in this paper, we further compare and analyze the indices for households with cars, households without cars and all households.The result shows that the average THAI of the households with cars is 59.30%,while that of the households without cars is 48.58% and that of all the households is 52.18% (10% more than the traditional Housing Affordability Index HAI). The THAI of home owners with cars does not change significantly while the distance between the block and the urban centre changes,and housing costs and transportation costs are comparable in importance; The THAI of home owners without cars declines significantly while the distance between the block and the urban centre increases,and housing costs are more important; The THAI of households who live in market rental housing shows obvious positive gradient while the distance between the block and the urban centre changes, and transportation costs are more important.The result of this thesis helps housing policy makers assess comprehensively housing and transportation affordability, and lends support to traffic planning, housing policy, urban planning and land supply. In the end, suggestions on how to comprehensively appraise housing affordability of low-income household are provided.